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Limited Neo

Importance of Neo-liberalism
The concept of neo-liberalism denotes a strand of liberal thoughts that enhances as number of strategies and approaches used by many western countries and the International Financial Institutions. In this case, the aspect of neo-liberalism allows the private sector to conduct itself independently without interference of the government. Additionally, the proponents of neo-liberalism support strategies and methods that make it possible for trade and finance to have unlimited movements across national borders. On this basis, the policies of neo-liberalism are very significant in economic policy making in the contemporary world as they roll back the roles played by the government and hence allow individuals to make their own decisions in relation to the global market (Parkin, 2009). In this case, decisions concerning the production, allocation and distribution of goods and services are excluded from the restrictions of the government and left to the global market. By doing this, the distribution of wealth among individuals is not restricted by the government. All over the world, these policies have been very influential hence replacing the more moderate Keynesian liberalism that sought economic growth and social stability by allowing a dynamic government role of controlling economy in a country (Qureshi, 1996).
The importance of neo-liberalism to economic policy making in the contemporary world can be evident in the concept of deregulation. In this case, this is the elimination of political interference and rules as well as regulations ion the operations market. In this case, one may ask a question on why the politicians interfere with the marketing operations of a country or in the global market? The answer is obvious which explains their self centered reasons. It should be noted that, through deregulation policies, there will be increased competition especially in the banking sector as government regulations and control are eliminated. A good example can be seen in Australia where two airline policies were cancelled which allowed any number of carriers into the market (Campbell & Pedersen, 2001). Through this competition the citizens will benefit from low prices and high quality services offered in the market. Additionally, individuals will be motivated to invest as there are no regulations involved in the market operations. As described above, the banking sector has been heavily controlled by governments of many economies hence charging a lot of money when depositing or withdrawing. This has all along hindered many investors from investing in this sector which generates a lot of profit. In the example of Australian airlines, only two carries were expected to operate but these policies were cancelled allowing different investors to invest (Thompson, 2006).
Secondly, the aspect of privatization has helped in policy making in the contemporary economies. In this case, this concept involves selling of the properties that are owned by the government to private sectors or organizations. It should be noted that, the contemporary world should be left to operate according to the forces of demand and supply rather than government interventions. In this case, the concept of neo-liberalism has allowed contracting out of public services that are provided by the government to private sectors (Bartle, 2005). This has helped in policy making as the government does not spend a lot of money in the provision of services. A good example is the provision of health care services in America which were previously provided by the federal government. On this basis, after the government allowed private sectors to provide these services citizens are in a position to choose the quality of services they want that will align with their financial statuses. On the other hand, in the case of Australia there was the case of sale of the Telstra and the Commonwealth Bank that were previously owned by the government (Tucker, 2008).
Additionally, the aspect of liberalization has been very helpful in policy making in the contemporary world. In this case, this is a case where the restrictions and limitations of movement of goods and services through trade across the borders are removed. On this basis, the government does not control the movement of trade and capital across national borders (Tucker, 2008). A point worth noting is that the current world is a global village where movement of capital, trade and expertise through technology is very easy. In this case, the process of policy making concerning economic issues will be made easy by liberalization as what a country lacks will be gotten from another country with ease. This case implies that there will be no discrimination against foreign goods and services. This has helped in encouraging the openness of international economic linkages. In this case, markets are determined by prices and forces of demand and supply (Bartle, 2005).
The concepts of liberalism were postulated by Adams Smith on the Britain situations but neo-liberalism has been developed by other economists like Milton Friedman in America and Friedreich Hayer in Britain. According to these economists, the best policy making procedure is allowing individual liberty to rest on economic freedom and economic affluence be based on motivating individuals (Lee & McBride, 2007). It is of importance to note that, global capitalism which has been brought about by neo-liberalization has helped many economists and governments in the process of policy making. In this case, a government may plan to start a program even though there is not adequate materials present in that country. On this basis, through the process of neo-liberalization and specifically free market the provision of required materials will be made easy. In this case, the creation of International Monetary funds helps in ensuring a stable exchange rate (Campbell & Pedersen, 2001).
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