Laissez Faire

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DEFINITION of 'Laissez Faire'

An economic theory from the 18th century that is strongly opposed to any government intervention in business affairs.

Sometimes referred to as "let it be economics."

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BREAKING DOWN 'Laissez Faire'

People who support a laissez faire system are against minimum wages, duties, and any other trade restrictions.

Laissez faire is French for "leave alone."

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RELATED FAQS
  1. How does adverse selection contribute to market failure?

    Adverse selection is perhaps the most academically cited example of market failure in a laissez-faire economy. The problem ... Read Full Answer >>
  2. How does capitalism work in a mixed economy?

    The standard spectrum of economic systems places laissez-faire capitalism at one extreme and a complete command economy at ... Read Full Answer >>
  3. To what extent can a government intervene in a market economy?

    There are many different definitions of a market economy, some of which allow for government intervention. In a laissez faire ... Read Full Answer >>
  4. What is the utility function and how is it calculated?

    In economics, utility function is an important concept that measures preferences over a set of goods and services. Utility ... Read Full Answer >>
  5. What does marginal utility tell us about consumer choice?

    In microeconomics, utility represents a way to relate the amount of goods consumed to the amount of happiness or satisfaction ... Read Full Answer >>
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