Question

1) Write a paragraph for the following terms. Provide one example when answering each paragraph.

A. Liberalism

B. Structural Adjustment

Answer 1

1.Liberalism

Liberalism is a political and economic philosophy based on strong support for a market economy and private property in the means of production.An economy that is managed according to these precepts may be described as liberal capitalism or liberal economy. It is an economic system organized on Individual lines, meaning that the greatest possible number of economic decisions are made by individuals rather than by collective institutions or organizations.It is associated with free markets and private ownership of capital assets. Historically, it arose in response to mercantilism and feudalism.It is all about production,distribution and consumption of goods and services.It measn that something free. It is basically free production,distribution,and consumption of goods and services.The main important beliefs of economic liberalism are Economy is made up of individual people,people should be free to trade with whomever they want and people make their own decisions.

example:

People have economic freedom when property they acquire without the use of force, fraud, or theft is protected from physical invasions by others and they are free to use, exchange, or give their property as long as their actions do not violate the identical rights of others.

2.Structural Adjustment

Structural adjustment is a term used to describe the policies requested by the IMF in condition for financial aid when dealing with an economic crisis in. The policies are designed to tackle the root cause of the problem and provide a framework for long term development and long term growth.It is adopted by the developing countries have been prompted by considerations of achieving macroeconomic balances and by the need for acceleration of economic growth through greater reliance on markets. Structural Adjustment programs are created with the goal of reducing the borrowing country's fiscal imbalances in the short and medium term or in order to adjust the economy to long-term growth. It is used to improve a country's balance of payments by increasing exports, decreasing imports and decreasing government spending , and increase foreign exchange earnings in order to better service debt. Their is also some critiques that are; Short term solutions to long term problems, Create and perpetuate inequalities, not goverment owned and Fail to reduce poverty.

Example:

It is usually involve a combination of free-market policies such as privatisation, fiscal austerity, free trade and deregulation.