UNIT 3: EVOLUTION OF LIBERALISM
Completion requirements
15. Capitalism as Economic Liberalism
Overview: Capitalism as Economic Liberalism
Political and Economic Freedom
You have learned that classical liberalism involves individual rights and freedoms under the rule of law. These rights and freedoms are both political and economic. Politically, under a liberal ideology, individuals have the right to make decisions
about their lives, including the right to choose their own leaders.
Economically, individuals also have many rights and freedoms under a liberal ideology, including the right to own property and make decisions about their money, including how to earn an income, where to invest, and what to buy and sell.
Laissez-faire capitalism is liberalism's answer to how an economic system should work. However, there are problems with an economy that has no regulations or controls.
In this section, you will develop a greater understanding of how capitalism changed in response to classical liberalism.
Economically, individuals also have many rights and freedoms under a liberal ideology, including the right to own property and make decisions about their money, including how to earn an income, where to invest, and what to buy and sell.
Laissez-faire capitalism is liberalism's answer to how an economic system should work. However, there are problems with an economy that has no regulations or controls.
In this section, you will develop a greater understanding of how capitalism changed in response to classical liberalism.
Friedrich Hayek's Austrian School of Economics (Supply Side Economics):
Milton Friedman's Monetarism (Supply Side Economics):
As you read the pages that follow, including the required textbook readings, take notes about how capitalist economies responded to liberalism while you consider the following question:
How does capitalism reflect the principles of classical liberalism?
