Academic Master

Business and Finance

Free Enterprise System

The free enterprise system entails a system where all resources are privately owned without any interference and restrictions of government. It refers to the model of the economy where businesses operate without the participation of government or minimal involvement of third parties and regulates the flow of capital goods within a market. This system has been adopted in many countries, particularly in the United States, over the past few decades as the free ownership of property in this system encourages free pricing, the rule of law, and competition to transact businesses without excessive third-party control, including the government in the country of operation. Bill Gates, in the United States, is one of the ingenious entrepreneurs who used this opportunity and made one of the most successful businesses around the globe. However, the question remains whether the free enterprise system model was necessary for Bill Gates to make a significant impact on the world.

The most influencing and notable characteristic of the free enterprise system model is that it provides all people and businesses an opportunity to be successful by providing them the opportunity to make their own economic decisions. Gates made an idea, utilized the free enterprise system model, started the business on his own, and made his own economic decisions for the business, and resultantly, Microsoft emerged as the most revenue-generating company in the World. Moreover, the model encouraged Bill Gates to compete with other businesses in the open market, innovate and create products or services that could meet and satisfy customers’ needs, and grow his business on a level playing field to thrive in Microsoft’s business worldwide. The necessary legal and economic framework for the business allowed Microsoft to compete with larger corporations as the framework did not need any third-party or governmental restrictions and legislative attestations (Solomon, 1997).

Building on the argument that the free enterprise system model was necessary for the establishment of Bill Gates’ business idea, the system allowed Gates to take risks and innovate without any fear of government interference. In addition, the system provided access to capital and resources while making independent economic decisions that were necessary for the establishment of his corporation. The system also encouraged Bill Gates to set his own prices, attract investors, expand the business globally, partner with potential investors, and revolutionize the technology industry while retaining profits from Microsoft’s success (Gates & BROOKS, 2014). This expansion of Microsoft and Bill Gates’ business idea would not be possible without a free enterprise system, which enabled Bill Gates to have the freedom to create and innovate his products.

In a nutshell, the free enterprise system encourages innovation, competition, risk-taking and no governmental interference enabling Bill Gates to shape the technology industry according to his own terms as we know it today.


Gates, B., & BROOKS, A. C. (2014). From poverty to prosperity: A conversation with Bill Gates. American Enterprise Institute.

Solomon, R. C. (1997). It’s good business: Ethics and free enterprise for the New Millenium. Rowman & Littlefield.



Calculate Your Order

Standard price





Pop-up Message