Free Enterprise

Loading the player...

What is a 'Free Enterprise'

A free enterprise is an economic system where few restrictions are placed on business activities and ownership. In this system, governments generally have minimal ownership of enterprises in the market place. This system aims for limited restrictions on trade and minimal government intervention.

BREAKING DOWN 'Free Enterprise'

The free enterprise movement started in the 1700s, when many individuals were restricted from starting and owning their own business without the permission of the government. The movement looked to reduce ownership and other related restrictions, such as how one should operate their business and who they were allowed to trade with.

Over time, the focus of this movement has shifted. A lot of its causes have been incorprated in most free-market systems. In the U.S. free enterprise advocates continue to fight for fewer restrictions along with fighting against any new developments that would restrict free enterprise.

RELATED TERMS
  1. Restricted Stock

    Insider holdings that are under some other kind of sales restriction. ...
  2. Enterprise Multiple

    A ratio used to determine the value of a company. The enterprise ...
  3. Restricted Market

    A market which does not allow for a free-floating exchange rate, ...
  4. Restricted Cash

    Monies earmarked for a specific purpose and therefore not available ...
  5. Social Enterprise

    An organization that is directly involved in the sale of goods ...
  6. Restricted Fund

    A reserve of money that can only be used for specific purposes. ...
Related Articles
  1. Economics

    What's Free Enterprise?

    Free enterprise is the economic term used to describe an economy with very little government ownership or regulation. In a free enterprise system, competition and the preferences and choices ...
  2. Fundamental Analysis

    Explaining Enterprise Multiple

    The enterprise multiple is a ratio used to value a company as if it was going to be acquired.
  3. Stock Analysis

    Enterprise Buys $2.1 Billion in Low-Hanging Fruit (EPD, PXD)

    Earlier this week, Enterprise Products Partners (NYSE: EPD) agreed to purchase a cornucopia of pipeline and processing assets from Pioneer Natural Resources (NYSE: PXD) and Reliance Industries ...
  4. Stock Analysis

    3 Reasons Enterprise Products Stock Could Rise (EPD)

    So far, 2015 has not been kind to shares of Enterprise Products Partners (NYSE: EPD). While the midstream energy specialist has routinely beaten the S&P 500 on a total return basis, its ...
  5. Stock Analysis

    Why Is Enterprise Products Partners So Excited?

    Enterprise Products Partners has historically gone on the offensive to acquire weaker rivals in a tough spot when the commodity market turns down.
  6. Fundamental Analysis

    The Difference Between Enterprise Value and Equity Value

    Enterprise value calculates a business’s current value, while equity value offers a snapshot of that business’s current and potential future value.
  7. Stock Analysis

    5 Things Enterprise's Management Wants You to Know (EPD)

    Last week, Enterprise Products Partners (NYSE: EPD) reported first-quarter earnings. While the numbers looked good, but not great, some of the things that the company's management said during ...
  8. Economics

    What is Restricted Cash?

    Restricted cash is cash that’s not available for a company to use immediately. It’s earmarked for some specific purpose.
  9. Trading Systems & Software

    Basics Of Trading Systems

    A trading system can save time and take the emotion out of trading, but adopting one takes skill and resources - learn more here.
  10. Executive Compensation

    How Restricted Stocks and RSUs Are Taxed

    Many firms pay a portion of their employees’ compensation in the form of restricted stock or restricted stock units.
RELATED FAQS
  1. What are restricted shares?

    Understand what a restricted share is. Learn why a company would issue restricted shares to employees and why an employee ... Read Answer >>
  2. What economic measures can be taken to encourage free enterprise?

    Learn about the types of economic policies that support free market capitalism, as espoused by thinkers in the classical ... Read Answer >>
  3. How is it possible for a company to have a negative enterprise value?

    Learn about enterprise value and how value investors use it to find good companies with undervalued stocks. Negative enterprise ... Read Answer >>
  4. What is the difference between a capitalist system and a free market system?

    Learn about capitalist and free market systems, how these economic systems function and the main difference between capitalism ... Read Answer >>
  5. What is the difference between enterprise value and equity value?

    Valuating a business accurately depends heavily on the purpose of the valuation. Learn how enterprise value and equity value ... Read Answer >>
  6. What are the main differences between a mixed economic system and pure capitalism?

    Read about the primary differences between a mixed economic system and a laissez-faire, free market economic system with ... Read Answer >>
Hot Definitions
  1. Goldilocks Economy

    An economy that is not so hot that it causes inflation, and not so cold that it causes a recession. This term is used to ...
  2. White Squire

    Very similar to a "white knight", but instead of purchasing a majority interest, the squire purchases a lesser interest in ...
  3. MACD Technical Indicator

    Moving Average Convergence Divergence (or MACD) is a trend-following momentum indicator that shows the relationship between ...
  4. Over-The-Counter - OTC

    Over-The-Counter (or OTC) is a security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, ...
  5. Quarter - Q1, Q2, Q3, Q4

    A three-month period on a financial calendar that acts as a basis for the reporting of earnings and the paying of dividends.
  6. Weighted Average Cost Of Capital - WACC

    Weighted average cost of capital (WACC) is a calculation of a firm's cost of capital in which each category of capital is ...
Trading Center