Neoliberalism

Neoliberalism, also neo-liberalism,^[1] is a term used to signify the late-20th century political reappearance of 19th-century ideas associated with free-market capitalism.^{[2][3][4][5][6]} The term has multiple, competing definitions, and is often used pejoratively.^[7][8] In scholarly use, the term is frequently undefined or used to characterize a vast variety of phenomena,^[9][10][11] but is primarily used to describe the transformation of society due to market-based reforms.^[12]

As an economic philosophy, neoliberalism emerged among European liberal scholars during 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 with the intention to counter the volatility of free markets.^[13] One impetus for the formulation of policies to mitigate capitalist 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 perceived failure of the post-war consensus and neo-Keynesian economics to address the stagflation of the 1970s.^[14][15] The collapse of the USSR and the end of the Cold War also made possible the triumph of neoliberalism in the United States and around the world.^[16][17]

The term neoliberalism has become more prevalent in recent decades.^{[18][19][20][21][22][23]} A prominent factor in the rise of conservative and right-libertarian organizations, political parties, and think tanks, and predominantly advocated by them,^[24][25] neoliberalism is often 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.^{[26][27][28][29][30]} The neoliberal project is also focused on designing institutions and is political in character rather than only economic.^{[31][32][33][34]}

The term is rarely used by proponents of free-market policies.^[35] When the term entered into common academic use during the 1980s in association with Augusto Pinochet's economic reforms in Chile, it quickly acquired negative connotations and was employed principally by critics of market reform and laissez-faire capitalism. Scholars tended to associate it with the theories of economists working with the Mont Pelerin Society, including 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.^[9][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.^[9] 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.^[19][20]