Neoliberalism And The Economic System

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De la Cruz, Daniela Max 132 Northrup 10:35 Section Essay #2 [Word Count] Neoliberalism, an approach in the economic system has brought up many debates on whether it is beneficial to the global economy or if it hinderous, or a combination of both. The question is then brought up, what constitutes neoliberalism? Ha-Joon Chang, a Korean heterodox economist, defines the main principle of neoliberalism as the government’s restriction of intervening with the market (Chang). Neoliberalism advocates for free trade, privatization of publicly owned enterprises, the act of balancing budgets as well as maintaining low budgets, and deregulation. Neoliberalists also argue that the benefits of this approach directly correlate with how free the system is. In other words, “the freer the system, the better off the ordinary poor people have been.” (Friedman) Additionally, Jagdish Bhagwati, a major proponent of neoliberalism, claims that women are doing better in neoliberalism economies. Scholars also argue that neoliberalism promotes economic growth and it trickles down to the lower classes of the economic hierarchy. Proponents of neoliberalism emphasize the need for trade liberalization through a decrease in tariff and non-tariff barriers, thereby freeing the exchange rate in order to benefit international competition and economic growth. A free market could benefit from limiting subsidies. Additionally, privatizing publically owned goods such as water, could provide financial gains for the
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