Neoliberalism Flashcards
They have similarities with modernisation
Both see development as a process of becoming more like us they believe in trade not aid as after all britan did not get rich though aid.
Free market forces
Wealth accumulates when left to pursuit self interests without constrains of government or taxation.
Adam Smith
The view owes much of its work of the 18th centrally liberal economist who advocated a laissez-faire economy meaning with little/no government intervention.
New right
The notion of this economic liberalism linked with the new right policy makes such as maggieT and RR
SAP
world bank loans are only given if a country follows a programme of reform drawn up by the IMF.
- Export cash crops e.g. cocoa
- Remove trade barriers e.g. import tariffs
- Deregulation e.g. cut back on legal framework e.g. minimum wage and health and safety.
- Cut back on public spending, privatise services such as health education.
SAP encourage
The majority world to change their economies so that they’re better integrated into the global market place and able to trade with the minority world. Also they make poor countries attractive to TNC’s thus increasing levels of FDI
Peter Bauer
Argued that aid have actually hindered not boosted development, negatives outweigh the positives.
- Undermines entrepreneurialism , as it takes away any incentive to get out of poverty they become reliant on hand outs.
- Props up corrupt regimes, aid takes away the responsibly of govenment to look after their own people.
- Distorts markets- Food aid often brings down local prices and makes it difficult for local producers to get a fair price.
Highlights not the job of the rich
Highlights not the job of the rich there needs to be a two way action to be taken by the government of the poor and address things such as corruption and taking steps for a economic reform and political organisation.
Four Asian tigers
The success for the four asian tigers supports neolib countries such as taiwan, they are newly industrialised and have high growth rates, they now have advanced economies and high income following the neolib strategy.
However it could be argued that cultural context played a part in success such as value of education.
In 1997 tiger economies got in trouble for extending too far and too fast.
Romanticised view
They have a romanticied view of the free market place it aims to create. The perspective is based on a very simplistic assumption that wealth will “trickle down” to benefit the marjory of the population.
A level playing field
The perspective assumes that this liberalisation will benefit populations of the south, but the world has changed the rich world has had a head start so international trade is not a level playing field, they cannot compete with first world conterpartners.
Misattribution
Neoliberal’s misattribute the course of economic growth. They assume that Britain got rich through enterpenealism but they got rich through exploitation through exploitation, colonialism TNC expoltaion.
Negative of SAP
Some theorists argue that the reforms or structural adjustment plans force nations to join international market before they are economically ready, the are unprotected and cannot compete so get “swallowed” by TNC
Effects of SAP
- over-competition, poor countries produce the same crops and this means prices fall.
- Deregulation- Leads to exploitation of workers.
- Privatisation- Means ordinary people are unable to afford education, healthcare and water.
Chomsky
Argues that the “the neo lib global order is concerned with minimising the role of the state”
Power is transferred from democratically elected to business elites. The condition of we give you aid if you meet our conditions is seen as morally unacceptable and counterproductive.
TNCS GIVEN TOO MUCH POWER.
