Neoliberalism, or neo-liberalism,[1] is a term used to signify the political reappearance of 19th-century ideas associated with free-market capitalism.[2]:7[3] A prominent factor in the rise of conservative and libertarian organizations, political parties, and think tanks, and predominantly advocated by them,[4][5] it is generally associated with policies of economic liberalization, including privatization, deregulation, globalization, free trade, monetarism, austerity, and reductions in government spending in order to increase the role of the private sector in the economy and society.[14] The defining features of neoliberalism in both thought and practice have been the subject of substantial scholarly debate.[15][16]

As an economic philosophy, neoliberalism emerged among European liberal scholars in the 1930s as they attempted to revive and renew central ideas from classical liberalism as they saw these ideas diminish in popularity, overtaken by a desire to control markets, following the Great Depression and manifested in policies designed to counter the volatility of free markets, and mitigate their negative social consequences.[17]:14–15 One impetus for the formulation of policies to mitigate free-market volatility was a desire to avoid repeating the economic failures of the early 1930s, failures sometimes attributed principally to the economic policy of classical liberalism. In policymaking, neoliberalism often refers to what was part of a paradigm shift that followed the alleged failure of the Keynesian consensus in economics to address the stagflation of the 1970s.[18][19] The collapse of the Soviet Union and the end of the Cold War also made possible the triumph of neoliberalism in the United States and around the world.[20][21]

The term has multiple, competing definitions, and a pejorative valence.[22] English speakers have used the term since the start of the 20th century with different meanings,[23] but it became more prevalent in the 1960s, 1970s and 1980s, used by scholars in a wide variety of social sciences[24][25][26] as well as by critics[27][28][29] to describe the transformation of society in recent decades due to market-based reforms.[7] The term is rarely used by proponents of free-market policies.[30] Some scholars reject the idea that neoliberalism is a monolithic ideology and have described the term as meaning different things to different people as neoliberalism has "mutated" into multiple, geopolitically distinct hybrids as it travelled around the world.[31][32][33] Neoliberalism shares many attributes with other concepts that have contested meanings, including representative democracy.[34]

When the term entered into common use in the 1980s in connection with Augusto Pinochet's economic reforms in Chile, it quickly took on negative connotations and was employed principally by critics of market reform and laissez-faire capitalism. Scholars tended to associate it with the theories of Mont Pelerin Society economists Friedrich Hayek, Milton Friedman, Ludwig von Mises and James M. Buchanan, along with politicians and policy-makers such as Margaret Thatcher, Ronald Reagan and Alan Greenspan.[35][36][37] Once the new meaning of neoliberalism became established as a common usage among Spanish-speaking scholars, it diffused into the English-language study of political economy.[35] By 1994, with the passage of NAFTA and with the Zapatistas' reaction to this development in Chiapas, the term entered global circulation. Scholarship on the phenomenon of neoliberalism has grown over the last few decades.[25][26]

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