The paper "How Has Neo-Liberal Policy at Both the Domestic and International Level Helped Drive Globalisation" is an outstanding example of business coursework. Neo-liberal policy or neoliberalism is an economic policy that involves minimal government intervention in business by having a free market scenario where the allocation of resources is determined by the forces of demand and supply. There is a link between neoliberal policy and capitalism – an economic system in which a country’ s a trade and industry are under the control private owners who aim to make a profit from their activities, rather than the state having control over trade and industry activities.
The link between neoliberal policy and capitalism is seen through the fact that when there is a free-market environment, private firms are able to grow and compete with each other, innovate and look new markets for labour and their products. As firms grow at both local and international levels, they look for opportunities to adopt better technologies, get cheaper labour and expand the markets for their products or services. This is partly what had driven the concept of globalisation, the phenomenon whereby the world is becoming increasingly interconnected due to increased trade and cultural exchanges between people across the globe. Based on the background information above, this essay will review how neoliberal policy at both the domestic and international level has helped in driving globalisation.
The essay will define the concepts of neoliberalism and capitalism as found in literature and relate the concept of neoliberal policy to the growth of globalisation. Definition of neoliberal policy Neoliberalism can be loosely defined as the conduct of human affairs in an environment in which a ‘ free market’ is prioritised (Castree, 2010, p.
1726). This means that in a neoliberal economic environment, producers are free to produce goods or services and sell them to buyers, who also have the freedom to choose what to buy and at what price. As noted by Castree (2010, p. 1726-1727), under neoliberalism, producers are depicted as having a free hand to deliver services and goods at a competitive price because if they fail to do so they would get few of no buyers to sell to and make a profit.
Similarly, consumers are depicted as having a free hand to determine from which manufacturers to buy which items, based on their ability to buy those items. Neoliberalism has also been defined as a political-economic theory that proposes that the wellbeing of human beings can best be achieved by having individual entrepreneurial skills and freedoms within an institutional setting that is characterised by free markets, private property ownership and free trade rights (Park & Lo, 2012, p. 156). This means that neoliberal policy advocates the creation of an institutional framework that promotes the freedom for people to use their skills to own property, to trade and to engage in other entrepreneurial activities that are beneficial to the society.
This implies that governments have to promote free-market ideas by promoting the creation of policies and institutions that reflect a free market environment (Kotz, 2015, p. 8). Such include reducing taxes to encourage businesses to invest and deregulating sectors such as manufacturing, banking, education and transportation so as to attract private capital in general and foreign investment in particular (Ha & Kim, 2015).
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