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Neoliberalism: Oversold?
Article

Neoliberalism: Oversold?

Jonathan D. Ostry, Prakash Loungani and Davide Furceri
Finance & Development , 2016
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  • Innovative

Recommendation

The United Kingdom’s vote to leave the European Union appears to be a vote against globalization. The neoliberal economic policies that prescribe open markets and fiscal austerity may have contributed to that backlash. In this informative research that calls for a more balanced approach to neoliberalism, economists Jonathan D. Ostry, Prakash Loungani and Davide Furceri of the International Monetary Fund find that the free flow of global capital, among other neoliberal policies, has been a mixed blessing. getAbstract recommends this thought-provoking report to policy makers, executives, economists and investors looking for another perspective on globalization.

Summary

Countries worldwide have used neoliberal policies since the 1980s to grow their economies. Neoliberalism call for unlocking a nation’s markets for international competition and decreasing government’s role in those markets, largely through privatizations of state-held assets and restrictions on public borrowings and fiscal deficits.

Neoliberalism has had positive outcomes, such as global poverty reductions and technology transfers to developing countries through foreign direct investment. And privatization has made many governments more productive and cost-effective. However, other...

About the Authors

Jonathan D. Ostry, Prakash Loungani and Davide Furceri are economists at the International Monetary Fund.

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