laissez-faire


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Laissez-Faire

A term describing an economic theory that promotes government non-intervention. Laissez-faire theory states that most government interventions make an economy less efficient and hamper growth. According to this, government ought to restrict itself to safeguarding the right to private property. In its extreme form, it is opposed to any law limiting economic activities short of theft or extortion. Laissez-faire economists are philosophically opposed to minimum wages, protectionism, antitrust laws, and most laws intended to benefit workers at the expense of employers. Proponents of laissez-faire economics argue that it benefits employers and workers alike. For example, a man may open a mechanic shop to make money for himself, but, in the process of doing so, he may hire otherwise unemployed mechanics and service otherwise broken cars, which then facilitates business for the rest of the community. If there were environmental or wage restrictions on his business, however, he might not hire as many employees and may not start the mechanic shop at all. Critics of the theory contend that its benefits are overstated and that a laissez-faire structure without regulation lends itself to the creation of bubbles, which harms both businesses and their employees. See also: Reaganomics, Invisible Hand, Keynesian economics, Marxism, Regulation.

laissez-faire

Of, relating to, or being an economy devoid of government interference.

laissez-faire

an economic doctrine that emphasizes the superiority of‘free’ markets (see PRICE SYSTEM) over state regulation of individual markets and of the economy in general. Proponents of laissez-faire argue that a PRIVATE-ENTERPRISE ECONOMY will achieve a more efficient allocation and use of scarce economic resources and greater economic growth than will a CENTRALLY PLANNED ECONOMY where the government owns and directs the use of resources. This inference is based on the rationale that private ownership of resources and maximum freedom to deploy these resources in line with profit signals will create strong incentives to work hard and take risks. State bureaucracies, on the other hand, can tend to stifle enterprise and initiative. See CLASSICAL ECONOMICS, RATIONALIZATION, PRIVATIZATION.
References in periodicals archive ?
79% of them reported that they preferred democratic leadership style whereas 15.4% and 5.6% reported laissez-faire and authoritative styles respectively.
Keynes's turn away from laissez-faire was done on technocratic
Review of Sylvie Rivot, "Keynes and Friedman on Laissez-Faire and Planning: Where to Draw the Line?" Journal of the History of Economic Thought 36 (4): 518-521.
Composite reliability for latent variables for one index, such as Laissez-Faire equals with 1.
Men, on the other hand, are reported to be more transactional and laissez-faire. Some studies appear with contradictory findings portraying no gender differences in leadership styles.
In the laissez-faire environment, though, evidently anything can happen.
The relationships between transformational, transactional, and laissez-faire leadership styles are unclear to many small construction business owners (Humphreys, 2001).
MLQ is a multidimensional scale consisting of 37 items and measures a broad range of leadership styles such as transformational, transactional, and laissez-faire leadership.
Sir Liam said one of the risk factors for children drinking was parents having a "laissez-faire approach to a child drinking or getting drunk".
Sir Liam, who yesterday announced his intention to step down as chief medical officer for England, said one of the risk factors for children drinking was parents having a "laissez-faire approach to a child drinking or getting drunk".
Passive/Avoidant or Laissez-Faire Leadership delays decisions, is not accountable or responsible to others in achieving goals, and takes a "hands-off approach to management (Bass, 1985; Avolio & Bass, 2004).