Neo-liberalism
- Created by: kmules15
- Created on: 10-01-22 14:19
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- Neo-liberalism
- Liberal New Right
- Minimal state
- Self reliant, rational individuals
- Rejection of collectivism
- Elimination of govt intervention
- Promoted by Milton Friedman + Friedrich Hayek
- Free market = only mechanism that can meet demands for goods and services + achieve greatest prosperity
- Argue govt intervention can't solve econ problems or allocate resources
- Govt involvement either causes or makes this problem worse
- Free market must be protected against inflation, monopolies + govt intervention
- Monopolies reduce competition leading to distorted prices
- Inflation = 'great evil'
- Any fall in value of money discourages economic activity + investment
- Overcoming inflation is the one role the govt can play
- Friedman - Keynesian policies create demand inflation by encouraging govts to print too much money/ provide too much money
- Solution = monetarism
- Govt reduces inflation by controlling money through public spending cuts
- Pursued by Thatcher and Reagan
- Govt reduces inflation by controlling money through public spending cuts
- 'supply side'
- Solution = monetarism
- Govt intervention in econ = most potent threat to free market
- State planning, nationalization, high taxation rejected
- Distort the market and contribute to econ problems
- Thatcher's privatisation
- said that nationalized industries were inefficient and lacked dynamism
- Applied to state welfare
- State/social programmes continue to expand (regardless of demand) due to interest of concerned professionals
- End result= higher taxation, increased inflation + inefficient state services
- State/social programmes continue to expand (regardless of demand) due to interest of concerned professionals
- Applied to state welfare
- said that nationalized industries were inefficient and lacked dynamism
- State planning, nationalization, high taxation rejected
- Atomistic individualism
- Freedom of market = individual freedom
- Freedom = negative, need to remove external constraints/ limitations
- Preseve by opposing collectivism + rolling back state
- State welfare policies create dependency culture + infringe property rights
- Undermines atomistic individualism
- Without govt intervention, people are free to deal with each other
- Will create natural order
- Without govt intervention, people are free to deal with each other
- Undermines atomistic individualism
- Liberal New Right
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