Neoliberal Policy and Neoliberalism

There has been a shift in macroeconomic thinking and actual policy from World War II and the late 1970s, and the late 1970s to the present. This shift may be described as a movement from the Keynesian-Fordist policies to free-market economic policies. Mohamed (2008) argues that it is important to note that this shift is ideological, and this “ideology of free market capitalism is the motive force behind the globalization that occurred since the late 1970s” (p6). Associated with the shift from the golden Age of capitalism to the neoliberal era is the rise of Thatcherism in the UK and Reaganism in the US. Later, the decline and fall of the USSR, political and economic changes in Europe and the fall of the Berlin Wall strengthened free market policies. The credibility of such policies is “judged by an elite few… who operate in the financial markets… in the financial centers of a few developed countries, such as the US, Germany, Japan and Britain” (Mohamed, 2008, p7).

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