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Both of these ideologies emerged in their modern form during the Industrial Revolution and both were critical of industrial capitalism and its accompanying political structures.

However, socialism is better thought of as an economic system and end-goal that various political ideologies (such as Democratic Socialism and Anarchism) aim to achieve.

In general, anarchism is juxtaposed with socialist ideologies that are in favor of using the state apparatus to transition to a socialist economic system. Anarchism is critical of the state in its entirety, arguing that the state is illegitimate and, as a product of capitalism, the state needs to be dismantled during a socialist revolution. By contrast, non-anarchist socialists argue that the state must be utilized by the working class in some capacity to safeguard a worker's revolution against counter-revolutionary groups, and to organize the effort to construct a socialist economy.

Democratic socialists tend to believe in the permanence of the state in any economic order, while Marxists take a middle ground where the state only has a limited role during the transition to socialism before making itself redundant and "withering away".

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