What is the economic approach that seeks to merge capitalist and socialist practices?

The correct answer, social democracy, refers to an economic and political ideology that aims to blend elements of capitalism with socialist principles, establishing a system that emphasizes both social welfare and economic growth. Social democracies advocate for a mixed economy, where the government plays a strong role in regulating the market and providing public services, while still allowing for private ownership and capitalist practices.

This approach is characterized by a commitment to democratic governance, social justice, and the protection of individual rights, ensuring that citizens have access to essential services such as healthcare and education, which are often provided or subsidized by the state. By promoting policies that aim to reduce inequality and enhance social welfare, social democracy seeks to balance the efficiency and innovation of capitalism with the equitable distribution and social rights associated with socialism.

In contrast, socialism focuses primarily on collective ownership and the abolishment of private property in favor of communal control of resources, and communism takes this further by advocating for a classless society entirely, where all means of production are owned collectively. Liberalism generally emphasizes individual freedoms and limited government intervention in the economy, which does not align with the more extensive social safety nets and government involvement characteristic of social democracy.