In analysis of the relationship between neo liberalism and globalization , there are many of propotional conflicting ideas with each other presented by economists and specialists of the topic.Jhon Kvegin who prepared the discussion under the topic of interpreting globalization on behalf the reserch institute for social development of united nations introduced liberalism as a theory of globalization.It is very obvious that he does not see any difference between globalization and neo liberalism.Mean while , some economists view the neo liberalism as a potent movement of the globelization process which is the affection and mechanism of the neo liberalism.But some of economists have explained the globelization and neo liberalism as two of seperate concepts.
The main purpose of this article is to explain the relationship between globelization and neo liberalism.
Globelization intiated on 1870 and progression of globelization is distinctly divided in to three era.The first era of globelization extends from 1870 to 1914 and the second from 1940 to 1970.The third era of globelization process is continuing since 1970.In study of the history of neo liberalism , the very first hypothesis of it has been expressed on 1947 and emergence of these policies in to practicle context in global scale has been seen first time in Chille around the year of 1973.In such a circumstance , the primary fact that is scientifically proved is the lack of influence from liberalism to first and second era of globelization.
The theoritical foundation was prepared for first globelization by the concept of capitalism of Adam Smith .here , in state economic issues , the govenment influence is minimamized as well as the market and price system are the key diterminants of state's production.These unbarricaded economic principles and policies were widely accepted by western communities and they prepared a real practicle context for these principles in their own countries.The wide capacity opened for unbarricaded trade among many countries and new technolgy created most sofisticated methodes of transport as well as colanialism are the major contributions for the first era of globelization.
The second globelization is concretely based on the financial system of Bretend woods and maintaining low tax prices globally with the begining of GATT organization.According to above facts, the conclusion shows that the first and second globelizations are not influenced by neo liberalism as there is no relationship between 1st and 2nd globelizations and neo liberal approaches.
The third globelization made its begining after neo liberal concepts were widely accepted globally and its practicle issues and structures were used to modify and mould the economic and financial systems of most countries.Most economists believe that the third globelization resumed in1970 with the former prime minister of great Britain , Magret Thacher who activated firstly the neo liberal economic policies in the global scale.In the decade of 1980, Ronald Regon, the former president of United states constituted the neo liberal policies and activated under the document of Washinton agreement on 1989.How ever , prior to that, the economic flexibility was defined as a key regulation among many of structurally compared set of regulations of world bank , international monetary fund and united states.
Impose of neo liberal concepts was primarily based on the purpose of economic flexibility.Minimamization of government influence to the economy, removing the barriers for investments, setting efficiency based rules and regulations for trade were included to make economic flexibility.The flexible economy was able to remove the barriers of global trade, investments and exchanges of technological resources.This mechanism resumed on 1970 and it inter relates socio - economic facts of global context until present.so that economic globelization is clearly defined as removing various barriers and limits for economic functions to create economic unity around worldwide.
Definitely , neo liberalism made a great deal of enforcement to the third era of globelization.After the activation of neo liberal economic stratergies , the huge supportive background was made for third era of globelization.since the liberalism is an economic stratergy, the sole cause for third era of globelaization is not the neo liberal approach of economy.
But the globelization is merely not the one and only aspect of economic freedom which is built up causing liberal stratergies.Economic freedom is not the mechanism which is proceeding once, all over the whole world, but it initiates seperately from various countries of the world under the specific natural time table.
Economic freedom made a comprehensive straight forward movement that has not been seen ever in the areas of trade , financial deals and immigrations.How ever , there were many required factors that should have been added to make economic unity in global aspect.
Neo liberalism made no significant emphasis on building an economic unity among countries but it only expressed the importance of use of economic freedom stratergies to get rid of financial and economic puzzles that affect on them.
The English translation of නව ලිබරල්වාදය සහ ගෝලීයකරණය
The author; Famous proffessor of department of economy in university of Kelaniya
Translation
Anuradha Senarathna
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