Liberalization or liberalisation (
British English
British English (BrE, en-GB, or BE) is, according to Lexico, Oxford Dictionaries, "English language, English as used in Great Britain, as distinct from that used elsewhere". More narrowly, it can refer specifically to the English language in ...
) is a broad term that refers to the practice of making laws, systems, or opinions less severe, usually in the sense of eliminating certain government regulations or restrictions. The term is used most often in relation to
economics
Economics () is the social science that studies the production, distribution, and consumption of goods and services.
Economics focuses on the behaviour and interactions of economic agents and how economies work. Microeconomics analy ...
, where it refers to
economic liberalization
Economic liberalization (or economic liberalisation) is the lessening of government regulations and restrictions in an economy in exchange for greater participation by private entities. In politics, the doctrine is associated with classical liber ...
, the removal or reduction of restrictions placed upon (a particular sphere of) economic activity. However, liberalization can also be used as a synonym for
decriminalization
Decriminalization or decriminalisation is the reclassification in law relating to certain acts or aspects of such to the effect that they are no longer considered a crime, including the removal of criminal penalties in relation to them. This reform ...
or
legalization (the act of making something legal after it used to be illegal), for example when describing
drug liberalization
Drug liberalization is a drug policy process of decriminalizing or legalizing the use or sale of prohibited drugs. Variations of drug liberalization include: drug legalization, drug re-legalization and drug decriminalization. Proponents of drug ...
.
In economy and trade
The
Great Depression of 1929 made nations throughout the world realize that the wide gap between the economic theory and practice in determination of internal trade policy was the major cause of worldwide economic disaster. Therefore, a need for reviving the
classical theory of trade by adhering to free trade policy was felt.
The
Bretton Woods Conference
The Bretton Woods Conference, formally known as the United Nations Monetary and Financial Conference, was the gathering of 730 delegates from all 44 Allied nations at the Mount Washington Hotel, situated in Bretton Woods, New Hampshire, Unit ...
of 1944, which recommended the establishment of
International Monetary Fund (IMF) ''and the
World Bank
The World Bank is an international financial institution that provides loans and grants to the governments of low- and middle-income countries for the purpose of pursuing capital projects. The World Bank is the collective name for the Inte ...
'', had also recommended the establishment of an
International Trade Organization
The International Trade Organization (ITO) was the proposed name for an international institution for the regulation of trade.
Led by the United States in collaboration with allies, the effort to form the organization from 1945 to 1948, with the ...
(ITO). Although, the IMF and the World Bank were established in 1946, the proposal for ITO did not materialize. Instead, the
General Agreement on Tariff and Trade ''(GATT)'', a less ambitious institution, was formed in 1948. The primary objective of GATT is to expand
international trade
International trade is the exchange of capital, goods, and services across international borders or territories because there is a need or want of goods or services. (see: World economy)
In most countries, such trade represents a significan ...
by liberalizing trade so as to bring about all round economic prosperity. GATT was signed in 1947, came into effect in 1948 and lasted until 1994. It was replaced by the
World Trade Organization
The World Trade Organization (WTO) is an intergovernmental organization that regulates and facilitates international trade. With effective cooperation
in the United Nations System, governments use the organization to establish, revise, and ...
in 1995. The original GATT text (GATT 1947) is still in effect under the WTO framework. Thus liberalization was born.
Economic liberalization refers to the reduction or elimination of government regulations or restrictions on private business and trade. It is usually promoted by advocates of
free market
In economics, a free market is an economic system in which the prices of goods and services are determined by supply and demand expressed by sellers and buyers. Such markets, as modeled, operate without the intervention of government or any o ...
s and
free trade
Free trade is a trade policy that does not restrict imports or exports. It can also be understood as the free market idea applied to international trade. In government, free trade is predominantly advocated by political parties that hold ...
, whose ideology is also called
economic liberalism
Economic liberalism is a political and economic ideology that supports a market economy based on individualism and private property in the means of production. Adam Smith is considered one of the primary initial writers on economic liberalis ...
. Economic liberalization also often involves reductions of taxes, social security, and unemployment benefits.
Economic liberalization is often associated with
privatization
Privatization (also privatisation in British English) can mean several different things, most commonly referring to moving something from the public sector into the private sector. It is also sometimes used as a synonym for deregulation when ...
, which is the process of transferring ownership or outsourcing of a business, enterprise, agency,
public
In public relations and communication science, publics are groups of individual people, and the public (a.k.a. the general public) is the totality of such groupings. This is a different concept to the sociological concept of the ''Öffentlichk ...
service or public property from the public sector to the private sector. For example, the
European Union
The European Union (EU) is a supranational political and economic union of member states that are located primarily in Europe. The union has a total area of and an estimated total population of about 447million. The EU has often been ...
has liberalized gas and electricity markets, instituting a competitive system. Some leading European energy companies such as France's
EDF and Sweden's
Vattenfall
Vattenfall is a Swedish multinational power company owned by the Swedish State. Beyond Sweden, the company generates power in Denmark, Finland, Germany, the Netherlands, and the United Kingdom.
The company's name is Swedish for " waterfall", a ...
remain partially or completely in government ownership. Liberalized and privatized public services may be dominated by big companies, particularly in sectors with high capital, water, gas, or electricity costs. In some cases they may remain legal monopolies, at least for some segments of the market like consumers. Liberalization, privatization and stabilization are the
Washington Consensus
The Washington Consensus is a set of ten economic policy prescriptions considered to constitute the "standard" reform package promoted for crisis-wracked developing countries by Washington, D.C.-based institutions such as the International Mon ...
's trinity strategy for economies in transition.
There is also a concept of hybrid liberalization. For instance, in
Ghana
Ghana (; tw, Gaana, ee, Gana), officially the Republic of Ghana, is a country in West Africa. It abuts the Gulf of Guinea and the Atlantic Ocean to the south, sharing borders with Ivory Coast in Ghana–Ivory Coast border, the west, Burkina ...
,
cocoa crops can be sold to competing
private companies, but there is a minimum price for which it can be sold and all exports are controlled by the state.
[Marcella Vigneri and Paulo Santos (2007)]
Ghana and the cocoa marketing dilemma: What has liberalization without price competition achieved?
, Overseas Development Institute
ODI (formerly the 'Overseas Development Institute') is a global affairs think tank, founded in 1960. Its mission is "to inspire people to act on injustice and inequality through collaborative research and ideas that matter for people and the ...
The term liberalization has its origin in the political ideology
liberalism
Liberalism is a political and moral philosophy based on the rights of the individual, liberty, consent of the governed, political equality and equality before the law."political rationalism, hostility to autocracy, cultural distaste for ...
, which took form by the early 19th century.
In social policy and government
In social policy, liberalization may refer to a relaxation of laws restricting certain practices or activities, such as
divorce
Divorce (also known as dissolution of marriage) is the process of terminating a marriage or marital union. Divorce usually entails the canceling or reorganizing of the legal duties and responsibilities of marriage, thus dissolving the ...
,
abortion
Abortion is the termination of a pregnancy by removal or expulsion of an embryo or fetus. An abortion that occurs without intervention is known as a miscarriage or "spontaneous abortion"; these occur in approximately 30% to 40% of pregn ...
, or
psychoactive drugs. Regarding
civil rights
Civil and political rights are a class of rights that protect individuals' freedom from infringement by governments, social organizations, and private individuals. They ensure one's entitlement to participate in the civil and political life ...
, it may refer to the elimination of
laws prohibiting homosexuality,
private ownership of firearms or other items,
same-sex marriage
Same-sex marriage, also known as gay marriage, is the marriage of two people of the same sex or gender. marriage between same-sex couples is legally performed and recognized in 33 countries, with the most recent being Mexico, constituting ...
,
inter-racial marriage, or
inter-faith marriage.
There is a distinct difference between liberalization and
democratization. Liberalization can take place without democratization, and deals with a combination of policy and social change specialized to a certain issue, such as the liberalization of government-held property for private purchase. Democratization is politically highly specialized; it can arise from a liberalization but works on a broader level of governmental liberalization.
See also
*
Artistic freedom
*
Civil libertarianism
Civil libertarianism is a strain of political thought that supports civil liberties, or which emphasizes the supremacy of individual rights and personal freedoms over and against any kind of authority (such as a state, a corporation, social ...
*
Cultural liberalism
Cultural liberalism is a social philosophy which expresses the social dimension of liberalism and advocates the freedom of individuals to choose whether to conform to cultural norms. In the words of Henry David Thoreau, it is often expressed ...
*
Decriminalization of sex work
*
Deregulation
Deregulation is the process of removing or reducing state regulations, typically in the economic sphere. It is the repeal of governmental regulation of the economy. It became common in advanced industrial economies in the 1970s and 1980s, as a r ...
*
Emancipation
Emancipation generally means to free a person from a previous restraint or legal disability. More broadly, it is also used for efforts to procure economic and social rights, political rights or equality, often for a specifically disenfranchi ...
*
Free trade
Free trade is a trade policy that does not restrict imports or exports. It can also be understood as the free market idea applied to international trade. In government, free trade is predominantly advocated by political parties that hold ...
*
Freedom of speech
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Freedom of thought
Freedom of thought (also called freedom of conscience) is the freedom of an individual to hold or consider a fact, viewpoint, or thought, independent of others' viewpoints.
Overview
Every person attempts to have a cognitive proficiency b ...
*
German reunification
German reunification (german: link=no, Deutsche Wiedervereinigung) was the process of re-establishing Germany as a united and fully sovereign state, which took place between 2 May 1989 and 15 March 1991. The day of 3 October 1990 when the Ge ...
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Libertarianism
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Liberty
Liberty is the ability to do as one pleases, or a right or immunity enjoyed by prescription or by grant (i.e. privilege). It is a synonym for the word freedom.
In modern politics, liberty is understood as the state of being free within society fr ...
*
Marketization
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Oligopoly
An oligopoly (from Greek ὀλίγος, ''oligos'' "few" and πωλεῖν, ''polein'' "to sell") is a market structure in which a market or industry is dominated by a small number of large sellers or producers. Oligopolies often result fr ...
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Sex-positive movement
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Sexual revolution
The sexual revolution, also known as the sexual liberation, was a social movement that challenged traditional codes of behavior related to sexuality and interpersonal relationships throughout the United States and the developed world from the ...
*
Social liberalism
Social liberalism (german: Sozialliberalismus, es, socioliberalismo, nl, Sociaalliberalisme), also known as new liberalism in the United Kingdom, modern liberalism, or simply liberalism in the contemporary United States, left-liberalism ...
Specific
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Drug liberalization
Drug liberalization is a drug policy process of decriminalizing or legalizing the use or sale of prohibited drugs. Variations of drug liberalization include: drug legalization, drug re-legalization and drug decriminalization. Proponents of drug ...
*
Energy liberalisation
Energy liberalisation refers to the liberalisation of energy markets, with specific reference to electricity generation markets, by bringing greater competition into electricity and gas markets in the interest of creating more competitive markets ...
*
Liberalisation features
Liberalization or liberalisation (British English) is a broad term that refers to the practice of making laws, systems, or opinions less severe, usually in the sense of eliminating certain government regulations or restrictions. The term is used m ...
References
Market structure
Economics of regulation
Law reform
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