Question

"Liberals believe that states should have a very small role in a Global/International Political Economy. According to this belief, the only job that states should have is to set the conditions in which markets can function as freely as possible."

Do you agree or disagree with this Liberal view? Why or why not?

How would trading and marketing come into play?

Answer 1

Liberals do not support the role of government in economic activities. They contend that the government should make minimum interference in economic activities. Market forces must be allowed to work efficiently.

The free market system would help to achieve a high growth level and resources would be used optimally. But if we see past events, the market system does not work efficiently. The economic depression and recession conditions are not automatically corrected through the market forces.

Theses recessions and depression reduce the output significantly and there must be government intervention to correct such disequilibrium. Thus, government participation can not be avoided.

We would partially agree with the liberal view that the government must be reduced significantly.

The government should make the right intervention where the private sector does not enter.

Trading and marketing activities are efficiently materialized by the private sector, thus in our view, government should not make a direct intervention in these fields, instead, government should make the rules and norms for making these areas more competitive.