I think a good way to approach this question is to examine what type of economy usually thrives in a democracy. When you look at it from this point of view, usually we are in the realm of capitalism, but not exclusively. For example, some would say that the Chinese are the best capitalists today! Just think of their growth compared to ours. With that said, democracies usually have a capitalistic economy. The benefits of this economy are that it allows people to work hard and get ahead, at least theoretically. It also promotes competition and investment, since the government is not really supposed to intervenee to regulate things. In short, I think what capitalism does is create forum where greed can compete with greed.