The Economic Framework in the Post-War Era - Essay Example

The Countries were ravaged by WWII and the emergence of international bodies like the United Nations, IMF, etc. was primarily formed to support the rebuilding processes of the nations and provide a world forum that can provide mediation. The central banks play a critical role and the national political and economic agenda mainly revolved around low-interest rates, regulation of industries, and labor unions to strengthen the business environment within the countries.
Neo-liberalism, on the other hand, can broadly be defined in terms of emerging new economic paradigms in the changing socio-political scenario across the world that favors the opening of the domestic market for global business powers. But from 1975 onwards, the world economy has increasingly become more market-driven and trade across geographical regions has become more attractive to developed and developing countries.

Answer 2
In the new-liberalism era, the economic conditions had drastically changed through the de-regulation of industries, privatization, and a curb on union power. America came to the forefront of the global political and economic front. With Ronal Reagan, as President of America in 1980, the demise of the old economic order became a certainty. The role of the central bank was significantly curbed and privatization became the major propellant of the new economic order. The strong economy and advanced stature of the United States, subsequently, made sure the success of the US Dollar as a Global Currency. This system greatly facilitated international trade and investment but restricted the capital movement to maintain a certain extent of control by a few dominant countries (Harvey, 2005).

Answer 3
The advent of neo-liberalism primarily relied on economic liberalization. It promoted a more capitalistic approach that favored the rich and made the poor nations the scapegoat for getting exploited by developed countries and multinationals. The monopoly of American influence in all the leading international financial institutes like the World Bank and IMF have followed the American policy of one-way transparency whereby the developed and under-developed countries, must open their market and relax their laws to suit the interests of the multinational companies.
Answer 4
While the post-war order was more focused on government initiatives for providing and creating wider business opportunities through credit facilities from the central banks, the neo-liberal order believed in liberalizing economic policies to promote entrepreneurship through the expansion of trade across borders. The key features of the neo-liberal order, therefore, were market-oriented and gave considerable leverage to free market and free trade policies that promoted the liberation of the industry from the institutional framework which was hitherto intrinsically linked with government regulations. With rapid globalization and the fast-developing economies of the Asian region, the concept of neo-liberalism has become more meaningful and encourages equitable sharing of resources across geographical boundaries. Read More