Capitalism is a very simple concept. Distribution is determined by what people are able to provide and whether or not someone else is willing to trade for it. It is so natural that it happens with no governing body.
The great advantage of this system is that it forces every individual to constantly determine what they can provide that someone else will be willing to trade for, how much of it they are likely to want, and when and where they are likely to want it. This turns every individual into a computational node and results in a form of swarm intelligence that is one of the most efficient systems in nature.
The one problem, of course, is that some people may opt to steal rather than trade. This is where governments come in. Governments ensure that people trade rather than steal.
However, when governments overstep and start meddling in trade, such as by confiscating and redistributing according to some scheme, that is collectivism.
Collectivism destroys incentive. Essentially, it replaces one form of stealing with another more official form of stealing. People quickly realize that it is easier to have their government steal for them than to provide something to trade, and they become unproductive.
Collectivism is also clumsy. Governments never have enough information to distribute with nearly the efficiency of the swarm intelligence of capitalism. They invariably distribute the wrong amounts to the wrong places at the wrong times.
Communism, resource-based economies, and every form of socialism are examples of collectivism.
spikosauropod 