Capitalism is an economic SYSTEM based on private ownership of the means of production and the creation of goods or services for profit. It is characterized by free enterprise, competition, and the accumulation of capital. The term 'capitalism' was first used by Karl Marx in the mid-19th century to describe the economic SYSTEM of the time. The SYSTEM of capitalism is based on a free market economy, where individuals and businesses are free to produce and exchange goods and services without government interference. The accumulation of capital is the main goal of capitalism, as it allows for the reinvestment of profits into new businesses and investments.