Neoliberalism or neo-liberalism^[1] is the 20th-century resurgence of 19th-century ideas associated with laissez-faire economic liberalism and free market capitalism.^{[2] [] [3]} While it is most often associated with such ideas, the defining features of neoliberalism in both thought and practice have been the subject of substantial scholarly discourse.^[4] These ideas include economic liberalization policies such as privatization, austerity, deregulation, free trade^[5] and reductions in government spending in order to increase the role of the private sector in the economy and society.^[13] These market-based ideas and the policies they inspired constitute a paradigm shift away from the post-war Keynesian consensus which lasted from 1945 to 1980.^[14][15]

English-speakers have used the term "neoliberalism" since the start of the 20th century with different meanings,^[16] but it became more prevalent in its current meaning in the 1970s and 1980s, used by scholars in a wide variety of social sciences^[17][18] as well as by critics.^[19][20] Modern advocates of free market policies avoid the term "neoliberal"^[21] and some scholars have described the term as meaning different things to different people^[22][23] as neoliberalism "mutated" into geopolitically distinct hybrids as it travelled around the world.^[6] As such, neoliberalism shares many attributes with other concepts that have contested meanings, including democracy.^[24]

The definition and usage of the term have changed over time.^[7] As an economic philosophy, neoliberalism emerged among European liberal scholars in the 1930s as they attempted to trace a so-called "third" or "middle" way between the conflicting philosophies of classical liberalism and socialist planning.^{[25] []} The impetus for this development arose from a desire to avoid repeating the economic failures of the early 1930s, which neoliberals mostly blamed on the economic policy of classical liberalism. In the decades that followed, the use of the term "neoliberal" tended to refer to theories that diverged from the more laissez-faire doctrine of classical liberalism and which promoted instead a market economy under the guidance and rules of a strong state, a model which came to be known as the social market economy.

In the 1960s, usage of the term "neoliberal" heavily declined. When the term re-appeared in the 1980s in connection with Augusto Pinochet's economic reforms in Chile, the usage of the term had shifted. It had not only become a term with negative connotations employed principally by critics of market reform, but it also had shifted in meaning from a moderate form of liberalism to a more radical and laissez-faire capitalist set of ideas. Scholars now tended to associate it with the theories of Mont Pelerin Society economists Friedrich Hayek, Milton Friedman, and James M. Buchanan, along with politicians and policy-makers such as Margaret Thatcher, Ronald Reagan and Alan Greenspan.^[7][26] Once the new meaning of neoliberalism became established as a common usage among Spanish-speaking scholars, it diffused into the English-language study of political economy.^[7] By 1994, with the passage of NAFTA and with the Zapatistas' reaction to this development in Chiapas, the term entered global circulation.^[6] Scholarship on the phenomenon of neoliberalism has been growing over the last few decades.^[18][27]

An early use of the term in English was in 1898 by the French economist Charles Gide to describe the economic beliefs of the Italian economist Maffeo Pantaleoni,^[28] with the term "néo-libéralisme" previously existing in French,^[16] and the term was later used by others including the classical liberal economist Milton Friedman in his 1951 essay "Neo-Liberalism and its Prospects ^[339] .^[29] In 1938 at the Colloque Walter Lippmann, the term "neoliberalism" was proposed, among other terms, and ultimately chosen to be used to describe a certain set of economic beliefs.^{[25] [] [30]} The colloquium defined the concept of neoliberalism as involving "the priority of the price mechanism, free enterprise, the system of competition, and a strong and impartial state".^{[25] []} To be "neoliberal" meant advocating a modern economic policy with state intervention.^{[25] []} Neoliberal state interventionism brought a clash with the opposing laissez-faire camp of classical liberals, like Ludwig von Mises.^[31] Most scholars in the 1950s and 1960s understood neoliberalism as referring to the social market economy and its principal economic theorists such as Eucken, Röpke, Rüstow and Müller-Armack. Although Hayek had intellectual ties to the German neoliberals, his name was only occasionally mentioned in conjunction with neoliberalism during this period due to his more pro-free market stance.^[32]

During the military rule under Augusto Pinochet (1973–1990) in Chile, opposition scholars took up the expression to describe the economic reforms implemented there and its proponents (the "Chicago Boys").^[7] Once this new meaning was established among Spanish-speaking scholars, it diffused into the English-language study of political economy.^[7] According to one study of 148 scholarly articles, neoliberalism is almost never defined but used in several senses to describe ideology, economic theory, development theory, or economic reform policy. It has largely become a term of condemnation employed by critics and suggests a market fundamentalism closer to the laissez-faire principles of the paleoliberals than to the ideas of those who originally attended the colloquium. This leaves some controversy as to the precise meaning of the term and its usefulness as a descriptor in the social sciences, especially as the number of different kinds of market economies have proliferated in recent years.^[7]

Another center-left movement from modern American liberalism that used the term "neoliberalism" to describe its ideology formed in the United States in the 1970s. According to political commentator David Brooks, prominent neoliberal politicians included Al Gore and Bill Clinton of the Democratic Party of the United States.^[33] The neoliberals coalesced around two magazines, The New Republic and the Washington Monthly.^[34] The "godfather" of this version of neoliberalism was the journalist Charles Peters,^[35] who in 1983 published "A Neoliberal's Manifesto".^[36]

Elizabeth Shermer argued that the term gained popularity largely among left-leaning academics in the 1970s "to describe and decry a late twentieth-century effort by policy makers, think-tank experts, and industrialists to condemn social-democratic reforms and unapologetically implement free-market policies;"^[37] economic historian Phillip W. Magnes notes its reemergence in academic literature in the mid-1980s, after French philosopher Michel Foucault brought attention to it.^[38]

"Neoliberalism" is contemporarily used to refer to market-oriented reform policies such as "eliminating price controls, deregulating capital markets, lowering trade barriers" and reducing state influence in the economy, especially through privatization and austerity.^[7] It is also commonly associated with the economic policies introduced by Margaret Thatcher in the United Kingdom and Ronald Reagan in the United States.^[8] Some scholars note it has a number of distinct usages in different spheres:

There is, however, debate over the meaning of the term. Sociologists Fred L. Block and Margaret R. Somers claim there is a dispute over what to call the influence of free market ideas which have been used to justify the retrenchment of New Deal programs and policies over the last thirty years: neoliberalism, laissez-faire or "free market ideology".^[39] Others such as Susan Braedley and Med Luxton assert that neoliberalism is a political philosophy which seeks to "liberate" the processes of capital accumulation.^[40] In contrast, Frances Fox Piven sees neoliberalism as essentially hyper-capitalism.^[41] However, Robert W. McChesney, while defining it as "capitalism with the gloves off", goes on to assert that the term is largely unknown by the general public, particularly in the United States.^{[42] []} Lester Spence uses the term to critique trends in Black politics, defining neoliberalism as "the general idea that society works best when the people and the institutions within it work or are shaped to work according to market principles".^[43] According to Philip Mirowski, neoliberalism views the market as the greatest information processor superior to any human being. It is hence considered as the arbiter of truth. Neoliberalism is distinct from liberalism insofar as it does not advocate laissez-faire economic policy but instead is highly constructivist and advocates a strong state to bring about market-like reforms in every aspect of society.^[44] Anthropologist Jason Hickel also rejects the notion that neoliberalism necessitates the retreat of the state in favor of totally free markets, arguing that the spread of neoliberalism required substantial state intervention to establish a global 'free market.'^[45] According to Naomi Klein, the three policy pillars of neoliberal age are "privatization of the public sphere, deregulation of the corporate sector, and the lowering of income and corporate taxes, paid for with cuts to public spending."^[46]

Neoliberalism is also, according to some scholars, commonly used as a pejorative by critics, outpacing similar terms such as monetarism, neoconservatism, the Washington Consensus and "market reform" in much scholarly writing.^[7] Its use in this manner has been criticized,^[47][48] particularly by those who advocate for policies characterized as neoliberal.^{[49] []} The Handbook of Neoliberalism posits that the term has "become a means of identifying a seemingly ubiquitous set of market-oriented policies as being largely responsible for a wide range of social, political, ecological and economic problems," yet "such lack of specificity reduces its capacity as an analytic frame. If neoliberalism is to serve as a way of understanding the transformation of society over the last few decades then the concept is in need of unpacking".^[6] Historian Daniel Stedman Jones says the term "is too often used as a catch-all shorthand for the horrors associated with globalization and recurring financial crises".^{[50] []}

On the other hand, many scholars believe it retains a meaningful definition. Writing in The Guardian, Stephen Metcalf posits that the publication of the 2016 IMF paper "Neoliberalism: Oversold?" helps "put to rest the idea that the word is nothing more than a political slur, or a term without any analytic power".^[51]

The worldwide Great Depression of the 1930s brought about high unemployment and widespread poverty and was widely regarded as a failure of economic liberalism.^[53] To renew liberalism, a group of 25 intellectuals organized the Walter Lippmann Colloquium at Paris in August 1938. It brought together Louis Rougier, Walter Lippmann, Friedrich Hayek, Ludwig von Mises, Wilhelm Röpke and Alexander Rüstow, among others. Most agreed that the liberalism of laissez-faire had failed and that a new liberalism needed to take its place with a major role for the state. Mises and Hayek refused to condemn laissez-faire, but all participants were united in their call for a new project they dubbed "neoliberalism".^{[54] []} They agreed to develop the Colloquium into a permanent think tank called Centre International d'Études pour la Rénovation du Libéralisme based in Paris.

Deep disagreements in the group separated "true (third way) neoliberals" around Rüstow and Lippmann on the one hand and old school liberals around Mises and Hayek on the other. The first group wanted a strong state to supervise, while the second insisted that the only legitimate role for the state was to abolish barriers to market entry. Rüstow wrote that Hayek and Mises were relics of the liberalism that caused the Great Depression. Mises denounced the other faction, complaining that ordoliberalism really meant "ordo-interventionism".^{[54] []}

The purpose of the Colloquium was ultimately overwhelmed by the outbreak of World War II and was largely forgotten.^[55] Attempts to further neoliberal ideas, such as an effort by Colloque-attendee Wilhelm Röpke to establish a journal of neoliberal ideas, mostly floundered.^[56] It would not be until the conclusion of the war that a new organization, the Mont Pelerin Society—created and promoted by many of those who had been present at the Walter Lippmann Colloquium—would neoliberal ideas find greater acceptance.^[50]

Neoliberalism began accelerating in importance with the establishment of the Mont Pelerin Society in 1947, whose founding members included Friedrich Hayek, Milton Friedman, Karl Popper, George Stigler and Ludwig von Mises. Meeting annually, it would become a "kind of international 'who's who' of the classical liberal and neo-liberal intellectuals."^[57] While the first conference in 1947 was almost half American, the Europeans dominated by 1951. Europe would remain the epicenter of the community with Europeans dominating the leadership.^{[25] []}

Established during a time when central planning was in the ascendancy worldwide and there were few avenues for neoliberals to influence policymakers, the society became a "rallying point" for neoliberals, as Milton Friedman phrased it, bringing together isolated advocates of liberalism and capitalism. They were united in their belief that individual freedom in the developed world was under threat from collectivist trends,^[50] which they outlined in their statement of aims:

The society set out to develop a neoliberal alternative to, on the one hand, the laissez-faire economic consensus that had collapsed with the Great Depression and, on the other, New Deal liberalism and British social democracy, collectivist trends which they believed posed a threat to individual freedom.^[50] They believed that classical liberalism had failed because of crippling conceptual flaws which could only be diagnosed and rectified by withdrawing into an intensive discussion group of similarly minded intellectuals;^{[25] []} however, they were determined that the liberal focus on individualism and economic freedom must not be abandoned to collectivism.^[59]

For decades after the formation of the Mont Pelerin Society—an era in which Republican US President Richard Nixon famously declared "We are all Keynesians now"^[60]—the ideas of the society would remain largely on the fringes of political policy, confined to a number of think-tanks and universities^{[61] []} and achieving only measured success with the ordoliberals in Germany (who maintained the need for a strong state). It would not be until a succession of economic downturns and crises in the 1970s that neoliberal policy proposals would be widely implemented.

By this time, however, neoliberal thought had evolved. The early neoliberal ideas of the Mont Pelerin Society had sought to chart a middle way between the trend of increasing government intervention implemented after the Great Depression and the laissez-faire economics many of them believed produced the Great Depression. For instance, Milton Friedman, one of the most important neoliberal figures, wrote in his early essay "Neo-liberalism and Its Prospects": "Neo-liberalism would accept the nineteenth century liberal emphasis on the fundamental importance of the individual, but it would substitute for the nineteenth century goal of laissez-faire as a means to this end, the goal of the competitive order", which requires limited state intervention to "police the system, establish conditions favorable to competition and prevent monopoly, provide a stable monetary framework, and relieve acute misery and distress".^[62] By the 1970s, however, neoliberal thought—including Friedman's—focused almost exclusively on market liberalization and was adamant in its opposition to nearly all forms of state interference in the economy.^[50]

The first turn to neoliberal reform occurred in Chile after an economic crisis in the early 1970s, which led to a backlash against the socialist economic policies of the deposed president Salvador Allende and the rapid implementation of the neoliberal economic proposals promoted by the Chicago Boys, a group of Chilean economists educated under Friedman at the University of Chicago. The Chilean neoliberal project served as "the first experiment with neoliberal state formation" that would contribute to further neoliberal reforms elsewhere.^{[61] []} Beginning in the early 1980s, the Reagan administration and Thatcher government implemented a series of neoliberal economic reforms to counter the chronic stagflation the United States and United Kingdom had each experienced throughout the 1970s, and neoliberal policies would continue to dominate American and British politics until the 2008 financial crisis.^[50] In the decades after British and American reform, neoliberal policies were exported abroad, with Australia, New Zealand, the Middle East, and even communist China implementing significant neoliberal reform. Additionally, the International Monetary Fund and World Bank encouraged neoliberal reforms in many developing countries by placing reform requirements on loans, in a process known as structural adjustment.^{[61] []}

Neoliberal ideas were first implemented in West Germany. The economists around Ludwig Erhard drew on the theories they had developed in the 1930s and 1940s and contributed to West Germany's reconstruction after the Second World War.^[63] Erhard was a member of the Mont Pelerin Society and in constant contact with other neoliberals. He pointed out that he is commonly classified as neoliberal and that he accepted this classification.^[64]

The ordoliberal Freiburg School was more pragmatic. The German neoliberals accepted the classical liberal notion that competition drives economic prosperity, but they argued that a laissez-faire state policy stifles competition, as the strong devour the weak since monopolies and cartels could pose a threat to freedom of competition. They supported the creation of a well-developed legal system and capable regulatory apparatus. While still opposed to full-scale Keynesian employment policies or an extensive welfare state, German neoliberal theory was marked by the willingness to place humanistic and social values on par with economic efficiency. Alfred Müller-Armack coined the phrase "social market economy" to emphasize the egalitarian and humanistic bent of the idea.^[7] According to Boas and Gans-Morse, Walter Eucken stated that "social security and social justice are the greatest concerns of our time".^[7]

Erhard emphasized that the market was inherently social and did not need to be made so.^[54] He hoped that growing prosperity would enable the population to manage much of their social security by self-reliance and end the necessity for a widespread welfare state. By the name of Volkskapitalismus, there were some efforts to foster private savings. However, although average contributions to the public old age insurance were quite small, it remained by far the most important old age income source for a majority of the German population, therefore despite liberal rhetoric the 1950s witnessed what has been called a "reluctant expansion of the welfare state". To end widespread poverty among the elderly the pension reform of 1957 brought a significant extension of the German welfare state which already had been established under Otto von Bismarck.^[65] Rüstow, who had coined the label "neoliberalism", criticized that development tendency and pressed for a more limited welfare program.^[54]

Hayek did not like the expression "social market economy", but stated in 1976 that some of his friends in Germany had succeeded in implementing the sort of social order for which he was pleading while using that phrase. However, in Hayek's view the social market economy's aiming for both a market economy and social justice was a muddle of inconsistent aims.^[66] Despite his controversies with the German neoliberals at the Mont Pelerin Society, Ludwig von Mises stated that Erhard and Müller-Armack accomplished a great act of liberalism to restore the German economy and called this "a lesson for the US".^[67] However, according to different research Mises believed that the ordoliberals were hardly better than socialists. As an answer to Hans Hellwig's complaints about the interventionist excesses of the Erhard ministry and the ordoliberals, Mises wrote: "I have no illusions about the true character of the politics and politicians of the social market economy". According to Mises, Erhard's teacher Franz Oppenheimer "taught more or less the New Frontier line of" President Kennedy's "Harvard consultants (Schlesinger, Galbraith, etc.)".^[68]

In Germany, neoliberalism at first was synonymous with both ordoliberalism and social market economy. But over time the original term neoliberalism gradually disappeared since social market economy was a much more positive term and fit better into the Wirtschaftswunder (economic miracle) mentality of the 1950s and 1960s.^[54]

Chile was among the earliest nations to embrace neoliberal reform. Marxist economic geographer David Harvey describes the substantial neoliberal reforms in Chile beginning in the 1970s as "the first experiment with neoliberal state formation" that "provided helpful evidence to support the subsequent turn to neoliberalism in both Britain...and the United States."^[61]

The turn to neoliberal policies originates with the Chicago Boys, a select group of Chilean students who, beginning in 1955, were invited to the University of Chicago to pursue postgraduate studies in economics. They studied directly under Milton Friedman and his disciple, Arnold Harberger, and were exposed to Friedrich Hayek. Upon their return to Chile, their neoliberal policy proposals—which centered on widespread deregulation, privatization, reductions to government spending to counter high inflation, and other free-market policies^[69]—would remain largely on the fringes of Chilean economic and political thought for a number of years, as the presidency of Salvador Allende (1970–1973) brought about a socialist reorientation of the economy.^[70]

During the Allende presidency, Chile experienced a severe economic crisis, in which Chile's GDP fell by 14.3%, its unemployment rate rose to 23.7%, and inflation peaked near 150%.^[71][72] Following an extended period of social unrest and political tension, as well as diplomatic, economic, and covert pressure from the United States,^[73] the Chilean armed forces and national police overthrew the Allende government in a coup d'état.^[74] They established a repressive military junta, known for its suppression of opposition, and appointed army chief Augusto Pinochet Supreme Head of the nation.^[75] His rule was later given legal legitimacy through a controversial 1980 plebiscite, which approved a new constitution drafted by a government-appointed commission that ensured Pinochet would remain as President for a further eight years—with increased powers—after which he would face a re-election referendum.^[76]

The Chicago Boys were given significant political influence within the military dictatorship headed by Pinochet, and they implemented dramatic economic reform. In contrast to the extensive nationalization and centrally-planned economic programs supported by Allende, the Chicago Boys implemented rapid and extensive privatization of state enterprises, deregulation, and significant reductions in trade barriers during the latter half of the 1970s.^[77] In 1978, policies that would further reduce the role of the state and infuse competition and individualism into areas such as labor relations, pensions, health and education were introduced.^[7] Additionally, the central bank raised interest rates from 49.9% to 178% to counter high inflation.^[78]

These policies amounted to a shock therapy, which rapidly transformed Chile from an economy with a protected market and strong government intervention into a liberalized, world-integrated economy, where market forces were left free to guide most of the economy's decisions.^[81] Inflation was tempered, falling from over 600% in 1974, to below 50% by 1979, to below 10% right before the economic crisis of 1982.^[82] GDP growth spiked (see chart) to 10%.^[83] However, inequality widened as wages and benefits to the working class were reduced.^[84][85]

In 1982, Chile again experienced a severe economic recession. The cause of this is contested, however most scholars believe the Latin American debt crisis—which swept nearly all of Latin America into financial crisis—is a primary cause.^[86] Some scholars argue the neoliberal policies of the Chicago boys heightened the crisis (percent GDP decrease was higher than any other Latin American country) or even caused it;^[86] for instance, some scholars criticize the high interest rates of the period which—while stabilizing inflation—hampered investment and contributed to widespread bankruptcy in the banking industry. Other scholars fault governmental departures from the neoliberal agenda; for instance, the government pegged the Chilean peso to the US dollar, against the wishes of the Chicago Boys, which economists believe led to an overvalued peso.^[87][88]

After the recession, Chilean economic growth rose quickly, eventually hovering between 5% and 10% and significantly outpacing the Latin American average (see chart). Additionally, unemployment decreased^[89] and the percent of the population below the poverty line declined from 50 percent in 1984 to 34 percent by 1989.^[90] This led Milton Friedman to call the period the Miracle of Chile, and he attributed the successes to the neoliberal policies of the Chicago boys. Some scholars, however, attribute the successes to the re-regulation of the banking industry and a number of targeted social programs designed to alleviate poverty.^[90] Others note that while the economy had stabilized and was growing by the late 1980s, inequality widened: nearly 45% of the population had fallen into poverty while the wealthiest 10% had seen their incomes rise by 83%.^[91] According to Chilean economist Alejandro Foxley, by 1990 around 44% of Chilean families were living below the poverty line.^[92]

Despite years of suppression by the Pinochet junta, in 1988 a presidential election was held, as dictated by the 1980 constitution (though not without Pinochet first holding another plebiscite referendum in an attempt to amend the constitution).^[76] In 1990, Patricio Aylwin was democratically elected, bringing an end to the military dictatorship. The reasons cited for Pinochet's acceptance of democratic transition are numerous. Hayek, echoing arguments he had made years earlier in The Road to Serfdom,^[93] argued that the increased economic freedom he believed the neoliberal reforms had brought had put pressure on the dictatorship over time, resulting in a gradual increase in political freedom and, ultimately, the restoration of democracy. The Chilean scholars Javier Martínez and Alvaro Díaz, however, rejected this argument, pointing to the long tradition of democracy in Chile. They asserted that defeat of the Pinochet regime and the return of democracy came primarily from large-scale mass rebellion that, eventually, resulted in party elites using existing institutional mechanisms to restore democracy.^[94]

The neoliberal economic policies broadened and deepened in the 1990s, including unilateral tariff reductions and the adoption of free trade agreements with a number of Latin American countries and Canada.^[95] However, the decade also brought increases in government expenditure on social programs to tackle poverty and poor quality housing.^[96] Throughout the 1990s, Chile maintained high growth, averaging 7.3 from 1990 to 1998.^[95] Eduardo Aninat, writing for the IMF journal Finance & Development, called the period from 1986 to 2000 "the longest, strongest, and most stable period of growth in [Chile's] history."^[95] In 1999 there was a brief recession brought about by the Asian financial crisis, with growth resuming in 2000 and remaining near 5% until the worldwide 2008 financial crisis.^[97]

In sum, the neoliberal policies of the 1980s and 1990s—initiated by a repressive authoritarian government—transformed the Chilean economy from a protected market with high barriers to trade and hefty government intervention into one of the world's most open free-market economies.^[98][81] Chile experienced the worst economic bust of any Latin American country during the Latin American debt crisis (several years into neoliberal reform), but also had one of the most robust recoveries.^[99] Average annual economic growth from the mid-1980s to the Asian crisis in 1997 was 7.2 per­cent, 3.5 per­cent between 1998 and 2005, and growth in per capita real income from 1985 to 1996 averaged 5 percent—all outpacing Latin American averages.^[99][100] Inflation was brought under control.^[82] Between 1970 and 1985 the infant mortality rate in Chile fell from 76.1 per 1000 to 22.6 per 1000,^[101] the lowest in Latin America.^[102] Unemployment from 1980 to 1990 decreased, but remained higher than the South American average (which was stagnant). However, the percentage of the Chilean population living in poverty rose from 17% in 1969 to 45% in 1985^[103] at the same time government budgets for education, health and housing dropped by over 20% on average.^[104] The era was marked by instability.^[105] Scholars have mixed opinions on the effects of the neoliberal reforms. The CIA World Factbook states that Chile's "sound economic policies", maintained consistently since the 1980s, "have contributed to steady economic growth in Chile and have more than halved poverty rates,"^[106] and some scholars have even called the period the "Miracle of Chile"; other scholars, however, have called it a failure that led to extreme inequalities in the distribution of income and resulted in severe socioeconomic damage.^[80] It is also contested how much these changes were the result of neoliberal economic policies and how much they were the result of other factors;^[105] in particular, some scholars argue that after the Crisis of 1982 the "pure" neoliberalism of the late 1970s was replaced by a focus on fostering of a social market economy mixing neoliberal and social welfare policies.^{[61] []}

In the 1960s, Latin American intellectuals began to notice the ideas of ordoliberalism; they often used the Spanish term "neoliberalismo" to refer to this school of thought. They were particularly impressed by the social market economy and the Wirtschaftswunder ("economic miracle") in Germany and speculated about the possibility of accomplishing similar policies in their own countries. Note that neoliberalism in 1960s Argentina meant a philosophy that was more moderate than entirely Laissez-faire free market capitalism and favored using state policy to temper social inequality and counter a tendency towards monopoly.^[7]

In 1976, the military dictatorship's economic plan led by Martínez de Hoz was the first attempt at establishing a neoliberal program in Argentina. They implemented a fiscal austerity plan that reduced money printing in an attempt to counter inflation. In order to achieve this, salaries were frozen. However, they were unable to reduce inflation, which led to a drop in the real salary of the working class. They also liberalized trade policy so that foreign goods could freely enter the country. Argentina's industry, which had been on the rise for 20 years after the economic policies of former president Arturo Frondizi, rapidly declined as it was not able to compete with foreign goods. The deregulation of the financial sector, however, lead to short-term economic growth, before rapid decline after capital fled to the United States. Following the measures, there was an increase in poverty from 9% in 1975 to 40% at the end of 1982.^[84]

From 1989 to 2001, more neoliberal policies were implemented by Domingo Cavallo. This time, the privatization of public services was the main focus, although financial deregulation and free trade with foreign nations were also re-implemented. Along with an increased labour market flexibility, the unemployment rate dropped to 18.3%,^[107] although 60%[citation needed] of people lived below the poverty line. Public perception of the policies was mixed; while some of the privatization was welcomed, much of it was criticized for not being in the people's best interests. Protests resulted in the death of 29^[108] people at the hands of police, as well as the resignation of president Fernando de la Rúa two years before the full completion of his term.

During her tenure as Prime Minister, Margaret Thatcher oversaw a number of neoliberal reforms, including tax reduction, exchange rate reform, deregulation, and privatisation.^[109] These reforms were continued and supported by her successor John Major. Although opposed by the Labour Party, the reforms were largely left unaltered when Labour returned to power in 1997. Indeed, the Labour government under Tony Blair even implemented a variety of privatisation and deregulation measures that had not been completed under prior governments.^[110]

The Adam Smith Institute, a United Kingdom-based free market think tank and lobbying group formed in 1977 which was a major driver of the aforementioned neoliberal reforms,^[111] officially changed its libertarian label to neoliberal in October 2016.^[112]

Marxist economic geographer David Harvey argues the rise of neoliberal policies in the United States occurred during the 1970s energy crisis,^[113] and traces the origin of its political rist to Lewis Powell's 1971 confidential memorandum to the Chamber of Commerce in particular.^{[61] []} A call to arms to the business community to counter criticism of the free enterprise system, it was a significant factor in the rise of conservative and libertarian organizations and think-tanks which advocated for neoliberal policies, such as the Business Roundtable, The Heritage Foundation, the Cato Institute, Citizens for a Sound Economy, Accuracy in Academia and the Manhattan Institute for Policy Research. For Powell, universities were becoming an ideological battleground, and he recommended the establishment of an intellectual infrastructure to serve as a counterweight to the increasingly popular ideas of Ralph Nader and other opponents of big business.^{[114][115][113]} On the left, neoliberal ideas were developed and widely popularized by John Kenneth Galbraith, while the ideas of the Chicago School were advanced and repackaged into a progressive, leftist perspective in Lester Thurow's influential 1980 book "The Zero-Sum Society".^[116]

Early roots of neoliberalism were laid in the 1970s during the Carter administration, with deregulation of the trucking, banking and airline industries,^{[117][118][119]}, as well as the appointment of Paul Volcker to chairman of the Federal Reserve.^{[20] []} This trend continued into the 1980s under the Reagan administration, which included tax cuts, increased defense spending, financial deregulation and trade deficit expansion.^[120] Likewise, concepts of supply-side economics, discussed by the Democrats in the 1970s, culminated in the 1980 Joint Economic Committee report "Plugging in the Supply Side". This was picked up and advanced by the Reagan administration, with Congress following Reagan's basic proposal and cutting federal income taxes across the board by 25% in 1981.^[121]

During the 1990s, the Clinton administration also embraced neoliberalism^[110] by supporting the passage of the North American Free Trade Agreement (NAFTA), continuing the deregulation of the financial sector through passage of the Commodity Futures Modernization Act and the repeal of the Glass–Steagall Act and implementing cuts to the welfare state through passage of the Personal Responsibility and Work Opportunity Act.^{[120][122][123]} The neoliberalism of the Clinton administration differs from that of Reagan as the Clinton administration purged neoliberalism of neoconservative positions on militarism, family values, opposition to multiculturalism and neglect of ecological issues.^{[109] []} Writing in New York, journalist Jonathan Chait disputed accusations that the Democratic Party had been hijacked by neoliberals, saying that its policies have largely stayed the same since the New Deal. Instead, Chait suggested this came from arguments that presented a false dichotomy between free market economics and socialism, ignoring mixed economies.^[124] American feminist philosopher Nancy Fraser says the modern Democratic Party has embraced a "progressive neoliberalism," which she describes as a "progressive-neoliberal alliance of financialization plus emancipation".^[125] Historian Walter Scheidel says that both parties shifted to promote free market capitalism in the 1970s, with the Democratic Party being "instrumental in implementing financial deregulation in the 1990s".^[126]

Following the death of Mao Zedong in 1976, Deng Xiaoping led the country through far ranging market-centered reforms, with the slogan of Xiǎokāng, that combined neoliberalism with centralized authoritarianism. These focused on agriculture, industry, education and science/defense.^[61]

In Australia, neoliberal economic policies (known at the time as "economic rationalism"^[127] or "economic fundamentalism") have been embraced by governments of both the Labor Party and the Liberal Party since the 1980s. The Labor governments of Bob Hawke and Paul Keating from 1983 to 1996 pursued a program of economic reform focused on economic liberalisation. These governments privatised government corporations, deregulated factor markets, floated the Australian dollar and reduced trade protections.^[128] The government of John Howard (1996–2007) added fiscal prudence to the mix, running surpluses in eight out of its 11 years in office.^[129]

Keating, building on policies he had introduced while federal treasurer, implemented a compulsory superannuation guarantee system in 1992 to increase national savings and reduce future government liability for old age pensions.^[130] The financing of universities was deregulated, requiring students to contribute to university fees through a repayable loan system known as the Higher Education Contribution Scheme (HECS) and encouraging universities to increase income by admitting full-fee-paying students, including foreign students.^[131] The admission of domestic fee-paying students to public universities was abolished in 2009 by the Rudd Labor government.^[132]

Immigration to the mainland capitals by refugees have seen capital flows follow soon after, such as from war-torn Lebanon and Vietnam. Later economic-migrants from mainland China also, up to recent restrictions, had invested significantly in the property markets.^[133]

Australia was one of few developed countries not to go through a recession during the 2008 financial crisis; in fact, Australia has not had a recession since 1991, a length of time no other rich country has ever managed to maintain growth for.^[129]

In New Zealand, neoliberal economic policies were implemented under the Fourth Labour Government led by Prime Minister David Lange. These neoliberal policies are commonly referred to as Rogernomics, a portmanteau of "Roger" and "economics", after Lange appointed Roger Douglas minister of finance in 1984.^[134]

Lange's government had inherited a severe balance of payments crisis as a result of the deficits from the previously implemented two-year freeze on wages and prices by preceding Prime Minister Robert Muldoon, who had also maintained an exchange rate many economists now believe was unsustainable.^[135] The inherited economic conditions lead Lange to remark "We ended up being run very similarly to a Polish shipyard."^[136] On 14 September 1984, Lange's government held an Economic Summit to discuss the underlying problems with New Zealand's economy, which lead to calls for dramatic economic reforms previously proposed by the Treasury Department.^[137]

A reform program consisting of deregulation and the removal of tariffs and subsidies was put in place. This had an immediate effect on New Zealand's agricultural community, who were hit hard by the loss of subsidies to farmers.^[138] A superannuation surcharge was introduced, despite having promised not to reduce superannuation, resulting in Labour losing support from the elderly. The financial markets were also deregulated, removing restrictions on interests rates, lending and foreign exchange. In March 1985, the New Zealand dollar was floated.^[139] Additionally, a number of government departments were converted into state-owned enterprises, which lead to significant job losses: 3,000 within the Electricity Corporation; 4,000 within the Coal Corporation; 5,000 within the Forestry Corporation; and 8,000 within the New Zealand Post.^[138]

New Zealand became a part of the global economy. The focus in the economy shifted from the productive sector to finance as a result of zero restrictions on overseas money coming into the country. Finance capital outstripped industrial capital and the manufacturing industry suffered approximately 76,000 job losses.^[140]

The Middle East has experienced an onset of neoliberal policies beginning in the late 1960s.^[141][142] Egypt is frequently linked to the implementation of neoliberal policies, particularly with regard to the 'open-door' policies of President Anwar Sadat throughout the 1970s,^[143] and Hosni Mubarak's successive economic reforms between 1981 and 2011.^[144] These measures, known as al-Infitah, were later diffused across the region. In Tunisia, neoliberal economic policies are associated with former president and de facto dictator^[145] Zine El Abidine Ben Ali;^[146] his reign made it clear that economic neoliberalism can coexist and even be ecouraged by authoritarian states.^[147] Responses to globalisation and economic reforms in the Gulf have also been approached via a neoliberal analytical framework.^[148]

The adoption of neoliberal policies in the 1980s by international institutions such as the International Monetary Fund (IMF) and the World Bank had a significant impact on the spread of neoliberal reform worldwide.^{[20] []} To obtain loans from these institutions, developing or crisis-wracked countries had to agree to institutional reforms, including privatization, trade liberalization, enforcement of strong private property rights, and reductions to government spending.^[149][61] This process became known as structural adjustment, and the principles underpinning it the Washington Consensus.^[150]

The European Union (EU) is sometimes considered a neoliberal organization, as it facilitates free trade and freedom of movement, erodes national protectionism and limits national subsidies.^[151] Others underline that the EU is not completely neoliberal as it leaves the development of welfare policies to its constituent states.^[152][153]

The Austrian School is a school of economic thought which bases its study of economic phenomena on the interpretation and analysis of the purposeful actions of individuals.^{[154][155][156]} It derives its name from its origin in late-19th and early-20th century Vienna with the work of Carl Menger, Eugen von Böhm-Bawerk, Friedrich von Wieser and others.^[157] In 21st century usage by such economists as Mark Skousen, reference to the Austrian school often denotes a reference to the free-market economics of Friedrich Hayek who began his teaching in Vienna.^[158]

Among the contributions of the Austrian School to economic theory are the subjective theory of value, marginalism in price theory and the formulation of the economic calculation problem.^[159] Many theories developed by "first wave" Austrian economists have been absorbed into most mainstream schools of economics. These include Carl Menger's theories on marginal utility, Friedrich von Wieser's theories on opportunity cost and Eugen von Böhm-Bawerk's theories on time preference as well as Menger and Böhm-Bawerk's criticisms of Marxian economics. The Austrian School follows an approach, termed methodological individualism, a version of which was codified by Ludwig von Mises and termed "praxeology" in his book published in English as Human Action in 1949.^[160]

The former Federal Reserve Chairman Alan Greenspan, speaking of the originators of the School, said in 2000 that "the Austrian School have reached far into the future from when most of them practiced and have had a profound and, in my judgment, probably an irreversible effect on how most mainstream economists think in this country".^[161] In 1987, Nobel laureate James M. Buchanan told an interviewer: "I have no objections to being called an Austrian. Hayek and Mises might consider me an Austrian but, surely some of the others would not".^[162] Republican Congressman Ron Paul stated that he adheres to Austrian School economics and has authored six books which refer to the subject.^[163][164] Paul's former economic adviser, investment dealer Peter Schiff,^[165] also calls himself an adherent of the Austrian School.^[166] Jim Rogers, investor and financial commentator, also considers himself of the Austrian School of economics.^[167] Chinese economist Zhang Weiying, who is known in China for his advocacy of free market reforms, supports some Austrian theories such as the Austrian theory of the business cycle.^[168]

The Chicago school of economics describes a neoclassical school of thought within the academic community of economists, with a strong focus around the faculty of the University of Chicago. Chicago macroeconomic theory rejected Keynesianism in favor of monetarism until the mid-1970s, when it turned to new classical macroeconomics heavily based on the concept of rational expectations.^[169] The school is strongly associated with economists such as Milton Friedman, George Stigler, Ronald Coase and Gary Becker.^[170] In the 21 century, economists such as Mark Skousen refer to Friedrich Hayek as a key economist who influenced this school in the 20th century having started his career in Vienna and the Austrian school of economics.^[171]

The school emphasizes non-intervention from government and generally rejects regulation in markets as inefficient, with the exception of central bank regulation of the money supply (i.e. monetarism). Although the school's association with neoliberalism is sometimes resisted by its proponents,^[169] its emphasis on reduced government intervention in the economy and a laissez-faire ideology have brought about an affiliation between the Chicago school and neoliberal economics.^[14][172]

Neoliberal policies center on economic liberalization, principally deregulation of industry, privatization of state-owned enterprises, reductions to trade barriers and government spending, and monetarism.^[50] Neoliberal theory argues that the free market allows efficiency, economic growth, income distribution, and technological progress to occur; any state intervention to encourage these phenomena will only worsen economic performance.^{[49] []}

Neoliberalism advances the view that economic freedom and political freedom are inextricably linked. Milton Friedman argued in his book Capitalism and Freedom that economic freedom, while itself an extremely important component of absolute freedom, is a necessary condition for political freedom. He claimed that centralized control of economic activities is always accompanied by political repression. In his view, the voluntary character of all transactions in an unregulated market economy and wide diversity that it permits are fundamental threats to repressive political leaders that greatly diminish the power to coerce. Through the elimination of centralized control of economic activities, economic power is separated from political power and each can serve as a counterbalance to the other. Friedman feels that competitive capitalism is especially important to minority groups since impersonal market forces protect people from discrimination in their economic activities for reasons unrelated to their productivity.^[173] In The Road to Serfdom, Friedrich Hayek offered a similar argument: "Economic control is not merely control of a sector of human life which can be separated from the rest; it is the control of the means for all our ends".^[93] Amplifying their arguments, it has often been pointed out that increasing economic freedoms tends to raise expectations on political freedoms, eventually leading to democracy.

In a response to critics he claims accuse him of endorsing "the neoliberalization of academic life," Stanley Fish argues that academics should not engage in civic or democratic action in their role as academics. Fish claims academic freedom applies only within the university and the classroom, which are not the appropriate venues for taking stands on social or political issues. "I don’t foreclose the possibility [of academics engaging in civic or political action]; I just want to locate it outside the university and the classroom." Fish claims critics of the neoliberal university like David Harvey view such separation of classroom, society, and state as the university and academics giving up their former roles as crucial players in the public sphere and adopting more instrumental, commercial, and practical roles characteristic of neoliberalism.^[174] Fish arguing that academic responsibility only applies in an academic sphere neatly separated from the public, civic, and private spheres echoes the Friedman doctrine, Milton Friedman's argument that corporate social responsibility only applies in a private sphere neatly separated from the public and civic spheres.

Monetarism is an economic theory commonly associated with neoliberalism.^[61] Formulated by Milton Friedman, it focuses on the macroeconomic aspects of the supply of money, paying particular attention to the effects of central banking.^[175] It argues that excessive expansion of the money supply is inherently inflationary and that monetary authorities should focus primarily on maintaining price stability, even at the cost of other macroeconomic factors like economic growth.

Monetarism is often associated with the policies of the US Federal Reserve under the Chairmanship of economist Paul Volcker,^[61] which centered around high interest rates that are widely credited with ending the high levels of inflation seen in the United States during the 1970s and early 1980s^[176] as well as contributing to the 1980–1982 recession.^[177] Monetarism had particular force in Chile, whose central bank raised interest rates to counter inflation that had spiraled to over 600%.^[82] This helped to successfully reduce inflation to below 10%,^[82] but also resulted in job losses.

The Washington Consensus is a set of standardized policy prescriptions developed by the International Monetary Fund (IMF), the World Bank, and the US Department of Treasury for crisis-wracked developing countries, and is often associated with neoliberalism.^[178] These prescriptions, often attached as conditions for loans from the IMF and World Bank, focus on market liberalization, and in particular on lowering barriers to trade, controlling inflation, privatizing state-owned enterprises, and reducing government budget deficits.

Neoliberalism has its share of criticism in both left-wing politics and right-wing politics,^[179] with activists and academics alike criticizing it.^[180] Notable critics of neoliberalism in theory or practice include economists Joseph Stiglitz,^[181] Amartya Sen,^[182] Michael Hudson,^[183] Robert Pollin,^[184] Julie Matthaei^[185] and Richard D. Wolff;^[186] linguist Noam Chomsky;^[42] geographer and anthropologist David Harvey;^[61] Slovenian continental philosopher Slavoj Žižek,^[187] political activist and public intellectual Cornel West;^[188] Marxist feminist Gail Dines;^[189] author, activist and filmmaker Naomi Klein;^[190] journalist and environmental activist George Monbiot;^[191] Belgian psychologist Paul Verhaeghe;^[192] journalist and activist Chris Hedges;^[193] and the alter-globalization movement in general, including groups such as ATTAC.

Thomas Marois and Lucia Pradella posit that the impact of the global 2008–2009 crisis has given rise to a surge in new scholarship that criticizes neoliberalism and seeks policy alternatives.^[194]

Neoliberal thought has been criticized for its faith in the efficiency of markets, in the superiority of markets over government intervention, in the ability of markets to self-correct, and in the market's ability to deliver economic and political freedom.^[20] Along these lines, economist Paul Krugman has claimed the "laissez-faire absolutism" promoted by neoliberals "contributed to an intellectual climate in which faith in markets and disdain for government often trumps the evidence."^[20] A number of scholars have argued this unreserved faith in markets—called "market fundamentalism" by critics^[195]—has led to a neglect of social goods not captured by economic indicators, an erosion of democracy, an unhealthy promotion of unbridled individualism and social Darwinism, and economic inefficiency.

Some critics contend neoliberal thinking prioritizes economic indicators like GDP growth and inflation over social factors that might not be easy to quantify, like labor rights^[196] and access to higher education.^[197] This focus on economic efficiency can compromise other, perhaps more important, factors, or promote exploitation and social injustice.^[198] For example, anthropologist Mark Fleming argues that when the performance of a transit system is assessed purely in terms of economic efficiency, social goods such as strong workers' rights are considered impediments to maximum performance.^[199] He supports this assertion with a case study of the San Francisco Municipal Railway, known as Muni, which is one of the slowest major urban transit systems in the US and has one of the worst on-time performance rates.^[200][201] This poor performance, he contends, stems from structural problems including an aging fleet and maintenance issues. However, he argues that the neoliberal worldview singled out transit drivers and their labor unions, blaming drivers for failing to meet impossible transit schedules and considering additional costs to drivers as lost funds that reduce system speed and performance. This produced vicious attacks on the drivers' union and brutal public smear campaigns, ultimately resulting in the passing of Proposition G, which severely undermined the powers of the Muni drivers' union.

Other critics contend that the neoliberal vision de-emphasizes public goods.^[202] For example, the geographers Birch and Siemiatycki claim that the growth of marketization ideology has shifted discourse on public goods to monetary rather than social objectives, making it harder to justify public goods driven by equity, environmental concerns or social justice.^[203]

American scholar and cultural critic Henry Giroux alleges that neoliberal market fundamentalism fosters a belief that market forces should organize every facet of society, including economic and social life, and promotes a social Darwinist ethic that elevates self-interest over social needs.^{[204][205][206]} Marxist geographer David Harvey argues that neoliberalism promotes an unbridled individualism that is harmful to social solidarity.^{[61] []}

While proponents of economic liberalization have often pointed out that increasing economic freedom tends to raise expectations on political freedom, some scholars see the existence of non-democratic yet market-liberal regimes and the seeming undermining of democratic control by market processes as evidence that this characterization is ahistorical.^[207] Some scholars contend that neoliberal focuses may even undermine the basic elements of democracy.^[207][208] For example, Kristen Ghodsee, ethnographer and Professor of Russian and East European Studies at the University of Pennsylvania, asserts that the triumphalist attitudes of Western powers at the end of the Cold War and the fixation on linking all leftist political ideals with the excesses of Stalinism, permitted neoliberal, free-market capitalism to fill the void, which undermined democratic institutions and reforms, leaving a trail of economic misery, unemployment and rising economic inequality throughout the former Eastern Bloc and much of the West that fueled a resurgence of extremist nationalism.^[209]

Despite the focus on economic efficiency, some critics allege neoliberal policies actually produce economic inefficiencies. For instance, the replacement of a government-owned monopoly with privately owned companies might reduce the efficiencies associated with economies of scale.^[210] Structurally, some economists argue that neoliberalism is a system that socializes costs and privatizes profits.^[211][212] They argue this results in an abdication of private responsibility for socially destructive economic choices, and may result in regressive governmental controls on the economy to reduce damages by private individuals.

Critics argue that neoliberal policies have increased economic inequality^{[2] [] [213]} and exacerbated global poverty.^{[2] [] [214][215]} The Center for Economic and Policy Research's (CEPR) Dean Baker argued in 2006 that the driving force behind rising inequality in the United States has been a series of deliberate neoliberal policy choices, including anti-inflationary bias, anti-unionism and profiteering in the healthcare industry.^[216] The economists David Howell and Mamadou Diallo contend that neoliberal policies have contributed to a United States economy in which 30% of workers earn low wages (less than two-thirds the median wage for full-time workers) and 35% of the labor force is underemployed while only 40% of the working-age population in the country is adequately employed.^[217] The globalization of neoliberalism has been blamed for the emergence of a "precariat", a new social class facing acute socio-economic insecurity and alienation.^[218] In the United States, the "neoliberal transformation" of industrial relations, which considerably diminished the power of unions and increased the power of employers, has been blamed by many for increasing precarity, which could be responsible for as many as 120,000 excess deaths per year.^[219] In Venezuela, prior to the Venezualan crisis, deregulation of the labor market resulted in greater informal employment and a considerable increase in industrial accidents and occupational diseases.^[220] Even in Sweden, in which only 6% of workers are beset with wages the OECD considers low,^[221] some scholars argue that the adoption of neoliberal reforms—in particular the privatization of public services and the reduction of state benefits—is the reason it has become the nation with the fastest growing income inequality in the OECD.^[222][223]

A 2016 report by researchers at the International Monetary Fund (IMF) was critical of neoliberal policies for increasing economic inequality.^[224] While the report included praise for neoliberalism, saying "there is much to cheer in the neoliberal agenda," it noted that certain neoliberal policies, particularly freedom of capital and fiscal consolidation, resulted in "increasing inequality," which "in turn jeopardized durable [economic] expansion". The report contends that the implementation of neoliberal policies by economic and political elites has led to "three disquieting conclusions":

A number of scholars see increasing inequality arising out of neoliberal policies as a deliberate effort, rather than a consequence of ulterior motives like increasing economic growth. Marxist economic geographer David Harvey describes neoliberalism as a "class project" "carried out by the corporate capitalist class", and argued in his book A Brief History of Neoliberalism that neoliberalism is designed to increase the class power of economic elites.^{[113][226][61]} Economists Gérard Duménil and Dominique Lévy posit that "the restoration and increase of the power, income, and wealth of the upper classes" are the primary objectives of the neoliberal agenda.^[227] Economist David M. Kotz contends that neoliberalism "is based on the thorough domination of labor by capital".^{[49] []} Sociologist Thomas Volscho argues that the imposition of neoliberalism in the United States arose from a conscious political mobilization by capitalist elites in the 1970s, who faced two self-described crises: the legitimacy of capitalism and a falling rate of profitability in industry.^[228] In The Global Gamble, Peter Gowan argued that "neoliberalism" was not only a free-market ideology but "a social engineering project". Globally, it meant opening a state's political economy to products and financial flows from the core countries. Domestically, neoliberalism meant remaking of social relations "in favour of creditor and rentier interests, with the subordination of the productive sector to financial sectors, and a drive to shift wealth, power and security away from the bulk of the working population."^[229]

The implementation of neoliberal policies and the acceptance of neoliberal economic theories in the 1970s are seen by some academics as the root of financialization, with the financial crisis of 2007–2008 as one of its results.^{[230][40][231][232][49][233]} In particular, various neoliberal ideologies that had long been advocated by elites, such as monetarism and supply-side economics, were translated into government policy by the Reagan administration, which resulted in decreased government regulation and a shift from a tax-financed state to a debt-financed one. While the profitability of industry and the rate of economic growth never recovered to the heyday of the 1960s, the political and economic power of Wall Street and finance capital vastly increased due to debt-financing by the state.^[228] A 2016 International Monetary Fund (IMF) report blames certain neoliberal policies for exacerbating financial crises around the world, causing them to grow bigger and more damaging.^[234][235]

Several scholars have linked mass incarceration of the poor in the United States with the rise of neoliberalism.^{[2] [] [237][238][239]} Sociologist Loïc Wacquant and Marxist economic geographer David Harvey have argued that the criminalization of poverty and mass incarceration is a neoliberal policy for dealing with social instability among economically marginalized populations.^[240][61] According to Wacquant, this situation follows the implementation of other neoliberal policies, which have allowed for the retrenchment of the social welfare state and the rise of punitive workfare, whilst increasing gentrification of urban areas, privatization of public functions, the shrinking of collective protections for the working class via economic deregulation and the rise of underpaid, precarious wage labor.^{[240] [] [241]} By contrast, it is extremely lenient in dealing with those in the upper echelons of society, in particular when it comes to economic crimes of the upper class and corporations such as fraud, embezzlement, insider trading, credit and insurance fraud, money laundering and violation of commerce and labor codes.^[240][242] According to Wacquant, neoliberalism does not shrink government, but instead sets up a "centaur state" with little governmental oversight for those at the top and strict control of those at the bottom.^[240][243]

In expanding upon Wacquant's thesis, sociologist and political economist John L. Campbell of Dartmouth College suggests that through privatization the prison system exemplifies the centaur state. He states that "on the one hand, it punishes the lower class, which populates the prisons; on the other hand, it profits the upper class, which owns the prisons, and it employs the middle class, which runs them." In addition, he argues that the prison system benefits corporations through outsourcing, as inmates are "slowly becoming a source of low-wage labor for some US corporations". Both through privatization and outsourcing, Campbell argues, the penal state reflects neoliberalism.^{[246] []} Campbell also argues that while neoliberalism in the United States established a penal state for the poor, it also put into place a debtor state for the middle class and that "both have had perverse effects on their respective targets: increasing rates of incarceration among the lower class and increasing rates of indebtedness—and recently home foreclosure—among the middle class."^{[246] []}

David McNally, Professor of Political Science at York University, argues that while expenditures on social welfare programs have been cut, expenditures on prison construction have increased significantly during the neoliberal era, with California having "the largest prison-building program in the history of the world".^[247] The scholar Bernard Harcourt contends the neoliberal concept that the state is inept when it comes to economic regulation, but efficient in policing and punishing "has facilitated the slide to mass incarceration".^[248] Both Wacquant and Harcourt refer to this phenomenon as "Neoliberal Penality".^[249][250]

Some organizations and economists believe neoliberalism promotes economic and political policies that increase the power of corporations and shift benefits to the upper classes.^[251][186] For instance, Jamie Peck and Adam Tickell argue that urban citizens are increasingly deprived of the power to shape the basic conditions of daily life, which are instead shaped by companies involved in the competitive economy.^[252]

The International Monetary Fund (IMF) and World Bank, two major international organizations which often espouse neoliberal views,^[253] have been criticized for advancing neoliberal policies around the world.^[254][255] Sheldon Richman, editor of the libertarian journal The Freeman, argues that the IMF has imposed a "corporatist-flavored 'neoliberalism' on the troubled countries of the world."^[256] He contends that IMF policies of spending cuts and tax increases, as well as subjection to paternalistic supranational bureaucrats, have fostered "long-term dependency, perpetual indebtedness, moral hazard, and politicization" in the developing world, which has undermined "real market reform" and "set back the cause of genuine liberalism." Ramaa Vasudevan, associate professor of economics at Colorado State University, states that trade policies and treaties fostered by the United States in the neoliberal era, along with bailouts brokered by the World Bank and the IMF, have allowed corporate capital to expand around the world unimpeded by trade protections or national borders, "sucking countries in different regions of the world into global corporations' logic of accumulation." This expansion of global corporate capital, Vasudevan says, has buttressed its ability to "orchestrate a global division of labor most conducive to the demands of profitability" which in turn has facilitated "a brutal, global race to the bottom."^[257]

Mark Arthur, a Senior Fellow at the Center for Global Development Research in Denmark, has written that the influence of neoliberalism has given rise to an "anti-corporatist" movement in opposition to it. This "anti-corporatist" movement is articulated around the need to reclaim the power that corporations and global institutions have stripped governments of. He says that Adam Smith's "rules for mindful markets" served as a basis for the anti-corporate movement, "following government's failure to restrain corporations from hurting or disturbing the happiness of the neighbor [Smith]".^[258]

Neoliberalism is commonly viewed by scholars as encouraging of globalization,^[259] which is the subject of much criticism.

The emergence of the "precariat", a new class facing acute socio-economic insecurity and alienation, has been attributed to the globalization of neoliberalism.^[218]

Globalization can subvert nations' ability for self-determination.^[260]

A number of scholars have alleged neoliberalism encourages or covers for imperialism.^{[261][262][263]} For instance, Ruth J Blakeley, Professor of Politics and International Relations at the University of Sheffield, accuses the United States and its allies of fomenting state terrorism and mass killings during the Cold War as a means to buttress and promote the expansion of capitalism and neoliberalism in the developing world.^[264] As an example of this, Blakeley says the case of Indonesia demonstrates that the U.S. and Great Britain put the interests of capitalist elites over the human rights of hundreds of thousands of Indonesians by supporting the Indonesian Army as it waged a campaign of mass killings, which resulted in the annihilation of the Communist Party of Indonesia and its civilian supporters. Historian Bradley R. Simpson posits that this campaign of mass killings was "an essential building block of the neoliberal policies that the West would attempt to impose on Indonesia after Sukarno's ouster."^[265]

Geographer David Harvey argues neoliberalism encourages an indirect form of imperialism that focuses on the extraction of resources from developing countries via financial mechanisms.^{[61] []} This is practiced through international institutions like the International Monetary Fund (IMF) and World Bank who negotiate debt relief with developing nations. He alleges that these institutions prioritize the financial institutions that grant the loans over the debtor countries and place requirements on loans that, in effect, act as financial flows from debtor countries to developed countries (for example, to receive a loan a state must have sufficient foreign exchange reserves—requiring the debtor state to buy US Treasury bonds, which have interest rates lower than those on the loan). Economist Joseph Stiglitz has said of this: "What a peculiar world in which poor countries are in effect subsidizing the richest."^{[61] []}

The neoliberal approach to global health advocates privatization of the healthcare industry and reduced government interference in the market, and focuses on non-governmental organizations (NGOs) and international organizations like the International Monetary Fund (IMF) and the World Bank rather than government.^[266] This approach has faced considerable criticism.^{[267][268][269]} James Pfeiffer, Professor of Global Health at the University of Washington, has criticised the use of Structural Adjustment Programs (SAPs) by the World Bank and IMF in Mozambique, which resulted in reduced government health spending, leading international NGOs to fill service holes previously filled by government.^[270] He alleges this "new policy agenda" fragmented local health systems, undermined local control of health programs, and contributed to social inequality. Rick Rowden, a Senior Economist at Global Financial Integrity, has criticised the IMF's monetarist approach of prioritising price stability and fiscal restraint, which he alleges was unnecessarily restrictive and prevented developing countries from scaling up long-term investment in public health infrastructure.^[268] He argues this resulted in chronically underfunded public health systems and demoralising working conditions, which fueled a brain drain of medical personnel and undermined the fight against HIV/AIDS, as well as public health more generally, in developing countries.

Some academics and commentators have blamed neoliberalism and hyper-capitalism for exacerbating and normalizing the social ills and violence of contemporary society,^[271][272] including the increase in mass shootings,^[271][273] particularly in the United States.^[274][275]

Nicolas Firzli has argued that the rise of neoliberalism eroded the post-war consensus and Eisenhower-era Republican centrism that had resulted in the massive allocation of public capital to large-scale infrastructure projects throughout the 1950s, 1960s and 1970s in both Western Europe and North America: "In the pre-Reagan era, infrastructure was an apolitical, positively connoted, technocratic term shared by mainstream economists and policy makers […] including President Eisenhower, a praetorian Republican leader who had championed investment in the Interstate Highway System, America's national road grid […] But Reagan, Thatcher, Delors and their many admirers amongst Clintonian, "New Labour" and EU Social-Democrat decision makers in Brussels sought to dismantle the generous state subsidies for social infrastructure and public transportation across the United States, Britain and the European Union".^[276]

Following Brexit, the 2016 United States presidential election and the progressive emergence of a new kind of "self-seeking capitalism" ("Trumponomics") moving away to some extent from the neoliberal orthodoxies of the past, there is speculation that the United States, Britain, and other advanced economies may see increases in infrastructure investment:^[277][278]

Others, such as Catherine Rottenberg, do not see Trump's victory as an end to neoliberalism, but rather a new phase of it.^[280] American political theologian Adam Kotsko argues that contemporary right-wing populism, exemplified by Brexit and the Trump Administration, represent a "heretical" variant of neoliberalism, which accepts its core tenets but pushes them to new, almost "parodic" extremes.^[281]

It has been argued that trade-led, unregulated economic activity and lax state regulation of pollution have led to environmental degradation.^[282] Furthermore, modes of production encouraged under neoliberalism may reduce the availability of natural resources over the long term, and may therefore not be sustainable within the world's limited geographical space.^[283]

Marxist economic geographer David Harvey argues neoliberalism is to blame for increased rates of extinction.^{[61] []} Notably, he observes that "the era of neoliberalization also happens to be the era of the fastest mass extinction of species in the Earth's recent history."

The Friedman doctrine, which Nicolas Firzli has argued defined the neoliberal era,^[284] may lead companies to neglect concerns for the environment. Firzli insists that prudent, fiduciary-driven long-term investors cannot ignore the environmental, social and corporate governance consequences of actions taken by the CEOs of the companies whose shares they hold as "the long-dominant Friedman stance is becoming culturally unacceptable and financially costly in the boardrooms of pension funds and industrial firms in Europe and North America".^[284]

Neoliberalism has given rise to many instances of political opposition: