MIDTERM LESSON 4 (NEOLIBERALISM).pptx
- 1. Neoliberalism PREPARED BY: MARIA MERLLAN E. MIER, LPT
- 2. What Is Neoliberalism? Neoliberalism is a policy model that encompasses both politics and economics seeks to transfer the control of economic factors from the government to the private sector. often associated with the leadership of Margaret Thatcher, the prime minister of the U.K. from 1979 to 1990 (and leader of the Conservative Party from 1975 to 1990) and Ronald Reagan, the 40th president of the U.S. from 1981 to 1989.
- 3. Understanding Neoliberalism is a political and economic philosophy that emphasizes free trade, deregulation, globalization, and a reduction in government spending. It's related to laissez-faire economics, a school of thought that prescribes a minimal amount of government interference in the economic issues of individuals and society.
- 4. Characteristics of Neoliberalism Free enterprise, competition, deregulation, and the importance of individual responsibility Opposition to the expansion of government power, state welfare, inflation Minimizing government control of industry and boosting private sector ownership of business and property Free market capitalism and the efficient allocation of resources Globalization rather than heavily regulated markets and protectionism
- 5. A reduction in government spending and lower taxes Less government control over economic activity to enhance the efficient functioning of the economy An increase in the impact by the private sector on the economy A reduction in union power and greater flexibility in employment Government intervention when it's needed to help implement, sustain, and protect free market activities
- 6. Criticism of Neoliberalism Misguided Free Market Approach to Public Services advocating for a free market approach in areas such as health and education is misguided because these services are public services. Public services are not subject to the same profit motivation as other industries. Monopolies The adoption of neoliberal policies in the Western world has run concurrent with a rise in inequality in both wealth and income. While skilled workers may be in a position to command higher wages, low-skilled workers are more likely to see stagnant wages.
- 7. Criticism of Neoliberalism Increased Financial Instability Contrary to what proponents of neoliberalism typically claim, capital deregulation has not necessarily helped economic development. Rather, capital deregulation has led to an increase in financial instability including economic events that, at times, have sent shockwaves around the world. Inequality Neoliberal policies have been proven to increase inequality. This inequality can hinder the long-term growth prospects of an economy.
- 8. Criticism of Neoliberalism Globalization neoliberalism's emphasis on economic efficiency has encouraged globalization, which opponents see as depriving sovereign nations of the right to self-determination.
- 9. What Are the Effects of Neoliberalism? Some effects might be freer markets, access to more products and services to meet consumer demand, greater revenue and higher profits. Price reductions due to greater competition can also be an effect. Savings can result from a more efficient allocation of resources.