Neoliberalism [ 1 ] is both a political philosophy and a term used to signify the lateth-century political reappearance of 19th-century ideas associated with free-market capitalism. Neoliberalism is an economic philosophy that originated among European liberal scholars during the s.
It emerged as a response to the perceived decline in popularity of classical liberalism , which was seen as giving way to a social liberal desire to control markets. This shift in thinking was shaped by the Great Depression and manifested in policies designed to counter the volatility of free markets. In the context of policymaking, neoliberalism is often used to describe a paradigm shift that followed the failure of the post-war consensus and neo-Keynesian economics to address the stagflation of the s.
Neoliberalism has become an increasingly prevalent term in recent decades. These policies are designed to increase the role of the private sector in the economy and society. The term is rarely used by proponents of free-market policies. Although Hayek had intellectual ties to the German neoliberals, his name was only occasionally mentioned in conjunction with neoliberalism during this period due to his more pro-free market stance. During the military rule under Augusto Pinochet β in Chile, opposition scholars took up the expression to describe the economic reforms implemented there and its proponents the Chicago Boys.
As a result, there is controversy as to the precise meaning of the term and its usefulness as a descriptor in the social sciences , especially as the number of different kinds of market economies have proliferated in recent years. Unrelated to the economic philosophy, neoliberalism is used to describe a centrist political movement from modern American liberalism in the s. The "godfather" of this version of neoliberalism was the journalist Charles Peters , [ 42 ] who in published "A Neoliberal's Manifesto".
Historian Elizabeth Shermer argued that the term gained popularity largely among left-leaning academics in the s to "describe and decry a late twentieth-century effort by policymakers, think-tank experts, and industrialists to condemn social-democratic reforms and unapologetically implement free-market policies"; [ 44 ] economic historian Phillip W. Magness notes its reemergence in academic literature in the mids, after French philosopher Michel Foucault brought attention to it.
