Socialism Socialism is a type of economic system, a political movement, and a social theory. Socialism is based on the idea that governments should own and control a nation's resources rather than individuals. Socialism was first used to describe opposition to the free enterprise and market economies. The Industrial Revolution was the cause of many social problems. Long work hours, low pay, and poor working conditions caused Americans to first consider socialism. With government involvement in business, fairer treatment for all was feasible. Most countries today have socialist parties, many have socialist governments, and others who are in between have adopted socialist ide