Liberal market economy Essay Example | Topics and Well Written Essays - 1000 words

Liberal trade economic system - Essay ExampleAccording to Maurice Mullard, there is a linkage between the commitment to open-handed state and the concept of commercialize openhanded economies. The democracy and market economic system be linked with each other. In a democratic ground, the policy guarantees the people to choose the government. Similarly, the liberal market delivery provides choices in employment, consumer products, tuition facility and provisions of health. The democracy cannot survive without any commitment towards a market economy and the market economy cannot survive outside the political democracy (Mullard, 2004). The liberal market economy has the potential to top the capital economy. The social environmental factors of a liberal market economy are highly influenced by dint of the nature of autonomous work of the economy itself (Pagano & World Institute for Development Economics Research, 1996). The US and the UK economies are strongly anti-trust regu lations that forbid the firms entrance to financial credit and capital markets that are control by profitability and expectations of the market. The liberal market economy strongly follows the philosophy of neo-classical economics in which the firms use in a perfectly competitive market and are de destinationined by the short term profits (Deller, 2005). The economist Bennet Harrison and David Gordon viewed that the firms in the US and the UK in the liberal market economy reduces the be to emergence the profit margin in the short run. In a coordinated market economy, firms increase the profit margin through the enhanced productivity, technical advancements and labour training methods. The liberal market economy in view to the bankruptcy as a legitimate business strategy differentiates from coordinated market economies. In the US market, firms use the bankruptcy business strategy as an option to negotiate the labours and the suppliers contract. The better example was the United Airlines that used this strategy and restructured itself in reducing the costs (Deller, 2005). This kind of strategy has blend well known for the motive of short run profitability that has increased the gap between the main(a) and secondary labour market conditions. A study conducted by Dirk Akkermansa, Carolina Castaldi and Bart Losc found out that liberal market economy and coordinated market economy comprise diversity economies that illustrate varied patterns of strength and in comparison, they are quite heterogeneous across the industries. The scholars have concluded that the liberal market economy approximately specialises in essential innovations in industries that are related to electronics and chemicals while the coordinated market economies stick out on transport equipment industry and machinery industry (Akkermansa & Et. Al., 2008). According to Marijana Milic, the liberal market economy follows the philosophy that assists in promoting laissez-faire capitalism, maximum of free trade and competition. The liberal market economy provides rights and freedom to every country in order to enhance the development of the economy according to the supply and demand forces of that country (Milic, 2010). The liberal market economy has a representative relationship with the states and offers special treatment to the big corporations in tightness of economic power. This influences the people in general due to the