Market Fundamentalism

Market fundamentalism (also known as free market fundamentalism) is a pejorative term applied to a strong belief in the ability of laissez-faire or free market economy views or policies to solve economic and social problems.

Critics of free market economy have used the term to denote what they perceive as a misguided belief, or deliberate deception, that free markets provide the greatest possible equity and prosperity, and that any interference with the market process decreases social well being. Users of the term include adherents of interventionist, mixed economy and protectionist positions, as well as billionaires such as George Soros, and economists such as Nobel Laureates Joseph Stiglitz. and Paul Krugman. Critics cite as fundamentalist the unshakable belief, despite contrary evidence, that unfettered markets maximize individual freedom, that they are the best means to economic growth and that society should adhere to their ideas of progress. Ideas ascribed to fundamentalists include the belief that markets tend towards a natural equilibrium, and that the best interests in a given society are achieved by allowing its participants to pursue their own financial self-interest with little or no restraint or regulatory oversight. Critics claim that in modern society with world-wide conglomerates, or even merely large companies, the individual has no protection against fraud nor harm caused by products that maximize income by imposing externalities on the individual consumer as well as society.

According to economist John Quiggin, the standard features of "economic fundamentalist rhetoric" are "dogmatic" assertions and the claim that anyone who holds contrary views is not a real economist. John Ralston Saul claims this is simply a form of bullying. This approach follows from evidence that neoclassical economics provides a scientific explanation of economic phenomena, an explanation that economists state represents the status of scientific truth (if, and only if, all of the assumptions involved in deriving the economic analysis are simultaneously satisfied). However, Kozul-Wright states in his book The Resistible Rise of Market Fundamentalism that "ineluctability of market forces" neo-liberals and conservative politicians tend to stress, and their confidence on a chosen policy, rest on a "mixture of implicit and hidden assumptions, myths about the history of their own countries' economic development, and special interests camouflaged in their rhetoric of general good".