Paragraph: There has been no democracy that has grown economically without corporate capitalism.
There has been no democracy that has grown economically without corporate capitalism. It helps in modernizing the economy and enabling the transition from rural to urban, and agriculture to industry and services, which are inevitable with growth. It generates jobs – and there is no other way to fix a country’s unemployment challenge without a further impetus to private business. Big companies can operate on a large scale and become competitive both domestically and externally. A vibrant corporate capitalist base also leads to additional revenues for the State – which in turn, can be used for greater welfare for the marginalized and creating a more level playing field in terms of opportunities.
Q1. Which one of the following statements best reflects the critical message conveyed by the author of the passage?
(a) Corporate capitalism is important for economic growth of a State and also for democracy.
(b) Corporate capitalism is imperative for a modern State to achieve its political objectives.
(c) No State can ensure its economic survival for long without the role of corporate capitalism.
(d) Corporate capitalism and democracy have mutual dependence for their continued existence.
Q2. With reference to the above passage, the following assumptions have been made:
I. Corporate capitalism promotes the growth of labour force and provides more employment opportunities.
II. Poor and marginalized sections of population are benefited by corporate capitalism due to trickle-down effect.
Which of the above assumptions is/are valid?
(a) I only
(b) II only
(c) Both I and II
(d) Neither I nor II
UPSC Prelims 2025 CSAT
Q1. Correct Option: (a) Corporate capitalism is important for economic growth of a State and also for democracy.
Explanation: The passage clearly emphasizes the importance of corporate capitalism in achieving economic growth and modernization. It states explicitly that no democracy has grown economically without corporate capitalism. The author highlights how corporate capitalism helps in modernizing the economy, transitioning from rural to urban areas, generating employment, and providing additional revenues for welfare measures. Thus, the critical message conveyed by the author is best reflected in option (a).
Option (b) is incorrect because the passage does not specifically link corporate capitalism to achieving political objectives. Option (c) is incorrect because the passage does not claim that economic survival is impossible without corporate capitalism, only that growth and modernization are closely linked to it. Option (d) is incorrect because the passage does not explicitly state mutual dependence between democracy and corporate capitalism; rather, it emphasizes the importance of corporate capitalism for economic growth within democracies.
Q2. Correct Option: (c) Both I and II
Explanation: Let’s examine each assumption separately:
Assumption I: “Corporate capitalism promotes the growth of labour force and provides more employment opportunities.”
- The passage explicitly states that corporate capitalism generates jobs and is essential to addressing unemployment challenges. Thus, assumption I is valid.
Assumption II: “Poor and marginalized sections of population are benefited by corporate capitalism due to trickle-down effect.”
- The passage clearly mentions that a vibrant corporate capitalist base leads to additional revenues for the State, which can then be used for greater welfare for marginalized sections and creating a more level playing field. This implies a trickle-down effect benefiting poorer sections. Thus, assumption II is also valid.
Therefore, both assumptions I and II are valid according to the passage. Hence, option (c) is correct.
