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Laissez-faire (/ ˌ l ɛ s eɪ ˈ f ɛər / LESS-ay-FAIR, from French: laissez faire [lɛse fɛːʁ] ⓘ, lit. ' let do ' ) is a type of economic system in which transactions between private groups of people are free from any form of economic interventionism (such as subsidies or regulations ).
Laissez-faire François Quesnay ( French: [fʁɑ̃swa kɛnɛ] ; 4 June 1694 – 16 December 1774) was a French economist and physician of the Physiocratic school. [ 1 ] He is known for publishing the " Tableau économique " (Economic Table) in 1758, which provided the foundations of the ideas of the Physiocrats. [ 2 ]
The system works best when there is a complementary relationship between one person's needs and another person's desires, and so trade restrictions place an unnatural barrier to achieving one's goals. Laissez-faire was popularized by physiocrat Vincent de Gournay who is said to have adopted the term from François Quesnay's writings on China. [10]
Laissez-faire, or free market capitalism, is an ideology that prescribes minimal public enterprise and government regulation in a capitalist economy. [51] This ideology advocates for a type of capitalism based on open competition to determine the price , production and consumption of goods through the invisible hand of supply and demand ...
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Although laissez-faire has been commonly associated with capitalism, there is a similar economic theory associated with socialism called left-wing or socialist laissez-faire, also known as free-market anarchism, free-market anti-capitalism and free-market socialism to distinguish it from laissez-faire capitalism.
There is debate over the meaning of the term. Sociologists Fred L. Block and Margaret Somers claim there is a dispute over what to call the influence of free-market ideas which have been used to justify the retrenchment of New Deal programs and policies since the 1980s: neoliberalism, laissez-faire or "free market ideology". [47]
[2] In Japan in particular, the term ri, which is the Confucian idea of "order and harmony on human society" also came to represent "the idea of laissez-faire and the rationality of market exchange." [ 2 ] By the 1880s, the slogan "Civilization and Enlightenment" became potent throughout Japan, China, and Korea and was employed to address ...