Ayn Rand’s concept of capitalism violates the rules of her philosophy.
In Rand’s philosophy, mental concepts must be observed in the real world. What we observe are the characteristics of the concept, what she calls an “existent”. We can’t take part of what we see and make the part into a new concept:
“Nor can the concept of an existent mean its characteristics (some or all) apart from the existent which possesses them. A characteristic is an aspect of an existent. It is not a disembodied Platonic universal[1]…”
Rand says that her concept of capitalism has never existed in the real world[2]. Rand says her concept of capitalism is an “Unknown Ideal”[3], which is a term referring to a disembodied Platonic universal. She says her concept of capitalism is based on elements of other economic systems which have existed[4]; which means she parted characteristics from real things to create her ideal.
Therefore she is in violation of her philosophy.
[1] Intro to Objectivist Epistemology: The Analytic-Synthetic Dichotomy pg 143
[2] The Virtue of Selfishness: The Objectivist Ethics pg 33.
[3] Capitalism: The Unknown Ideal
[4] The Virtue of Selfishness: The Objectivist Ethics pg 33. Capitalism: The unknown ideal: The Roots of War pg. 39