Neoliberalism is a political-economic ideology that favors free markets, free trade, privatization, deregulation, and reduced public spending, holding that competition and minimal state intervention best allocate resources and generate prosperity.
The term revived classical liberal economics in the mid-twentieth century, but neoliberalism in its current sense took shape in the 1970s, when stagflation and rising public debt drew economists back toward market-first thinking. Its intellectual foundations are most associated with the Austrian-British economist Friedrich Hayek and the American economist Milton Friedman, whose ideas moved from academic argument into governing doctrine. They were put into practice by the administrations of Margaret Thatcher in the United Kingdom and Ronald Reagan in the United States, and, earlier and more abruptly, in Chile under Augusto Pinochet with guidance from the US-trained economists known as the Chicago Boys.
In practice, neoliberalism is usually identified with a consistent policy program: privatizing public assets and services, deregulating industry and finance, lowering income and corporate taxes, curbing the power of labor unions, and opening economies to free trade and the free movement of capital. Supporters credit these measures with spurring growth, competition, and global economic integration.
Critics argue that the same policies widened income inequality, weakened workers' protections, and subordinated public goods to market logic, and the term is now often used pejoratively by those who hold it responsible for financial instability and social strain. Whether described approvingly or critically, neoliberalism remains the dominant frame for understanding economic policy across much of the world since the 1980s.