Marx, influenced by the theories of his predecessors, developed a more holistic and scientific theory of capitalism and unearthed the contradictions of capitalist society. Further, he fused philosophy, history and economics and demonstrated how destruction of capitalism and “salvation through revolution” is a real possibility. He also developed a theory of socialism in which means of production are owned and controlled by society and, therefore, they are used for the progress of the whole society and not for the progress of capital alone or for the progress of any particular class of people. Thus socialism differs from capitalism in the sense that while capitalism legitimizes and promotes private property socialism says that the wealth in society must be viewed as the wealth of the whole society. Whether such a dream of socialism has ever been realized anywhere or not is a different issue. On the other hand, the Ricardian socialists and many others who wrote in favor of justice and equality rejected both revolution and government action (Spiegel, 1971, 442).

Enormous literature has been produced both in support of and against capitalism. Today with the fall of Soviet system, end of communism in Eastern Europe, and balkanization of Yugoslavia it is common to argue that there is no alternative to capitalism. It is also stressed in critical sociology that class socialism of socialist countries had actually not eradicated differences of power.

Marxist theory of society has been criticized by many economists and sociologists. The political developments in socialist Russia and communist China have also disturbed many Marxists who came up with theories of what went wrong in socialism and how the situation can be redeemed. The major criticisms of Marxist theory have been as follows:

• Inevitability of social stratification. Two sociologists, Kingsley Davis and Wilbert E. Moore (1945), argued that stratification is ubiquitous and serves the function of role allocation in society.

• In multifactor economy labor theory of value is not most adequate.

• Law of declining rate of profit (caused by increase in the proportion of fixed capital) and law of increasing misery of proletariat are not found to be true and are contradictory.

• Unemployment (surplus labor or industrial reserve army for Marx) and employment depend on public policy. In a capitalist system unemployment can be checked through public policy.

• Socialist countries have not been free from class inequalities, characteristic of all industrial societies irrespective of the nature of state.

There is ample literature on dissatisfaction among people in socialist countries which eventually led to downfall of socialism or capitalist reforms. Yet, the criticism of capital is still attractive to dream of an egalitarian and humane order.