liberalism economy

Question 1

what 2 things do liberals defend about the economy?

Answer 1

• defence of private property
• defence of capitalism and inequality

Question 2

why do liberals defend private property?

Answer 2

• at the heart of economic liberalism lies an unwavering belief in private ownership of property
• John Locke emphasised that property is a natural right which predates the state
• JSM also, later, argued that property facilitated individualism- incentivising individual enterprise and providing a sense of independence.
• it is seen as an important vehicle for self-realisation and self-determination
• Locke alos pointed out that when property is owned by a multitude of individuals, it offers further protection against concentrated power and overbearing rulers

Question 3

why do liberals defend capitalism and inequality?

Answer 3

• liberalisms support for a capitalist economy is strongly linked to its upbeat view of human nature.
• adam smith, liberal economist, asserted that if obstacles to free trade were swept away, and if individuals were allowed to trade freely, the ‘invisible hand’ of market forces would enrich individuals and nations
• liberals defend the inequality that capitalism produces. firstly, they assert that individual wealth, and individual economic success, will eventually ‘trickle down’ to the majority in society. secondly, they endorse Mill’s view that unequal outcomes are consistant with a ‘meritocratic’ society- one that encourages individualism and rewards those that have earned their advantages.
• however, John Rawls argued, that liberals should only defend equality of outcome if it is accompanied by equality of opportunity.
• liberals in the 19th century such as Mill commended laissez-faire capitalism, whereas in the 20th century, rawles tended to favour keynesian economics.