WHAT IS MEANT BY LAISSEZ FAIRE?
WHAT IS ITS RELATIONSHIP TO THE LIBERAL IDEOLOGY?
WHY WAS IT SIGNIFICANT IN THE 19TH CENTURY?
While the establishment of political liberalism was the main achievement of the liberal revolutions, there is also a liberalism applied to economics. Adam Smith in The Wealth of Nations expressed economic liberalism. So also did a number of French philosophes who coined the phrase "laissez faire". Laissez faire or economic liberalism shares with political liberalism the idea that governments should have limited power and that the individual should have maximum freedom within a framework of law.
Laissez faire, however, opposes any re-distribution of wealth by the government, and therefore gives a distinct advantage to middle and upper class people who are wealthy. In fact, by opposing any government intervention in the economy, the laissez faire ideology assures the security of the wealthy and justifies the unwillingness of the wealthy to share their wealth.
The argument for laissez
faire is based upon the premise that free trade and unregulated economic
activity will enhance economic growth by stimulating competitive enterprise.