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(lĕs'ā fâr`) [Fr.,=leave alone], in economics and politics, doctrine that an economic system functions best when there is no interference by government. It is based on the belief that the natural economic order tends, when undisturbed by artificial stimulus or regulation, to secure the maximum well-being for the individual and therefore for the community as a whole.

Formulations of the Doctrine

Historically, laissez-faire was a reaction against mercantilismmercantilism
, economic system of the major trading nations during the 16th, 17th, and 18th cent., based on the premise that national wealth and power were best served by increasing exports and collecting precious metals in return.
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, a system of commercial controls in which industry and trade, especially foreign trade, were merely seen as means of strengthening the state. Navigation laws, trade monopolies, taxes, and paternalistic regulations of all kinds bore heavily upon the rising class of merchants in the period of European colonial expansion. It was on behalf of this class that the French physiocratsphysiocrats
, school of French thinkers in the 18th cent. who evolved the first complete system of economics. They were also referred to simply as "the economists" or "the sect." The founder and leader of physiocracy was François Quesnay.
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, pioneer economists in the 18th cent., first formulated the principles of laissez-faire. With the physiocrats, state noninterference became a cardinal teaching; they especially opposed the taxation of commercial pursuits.

Opposition to mercantilism and state paternalism also motivated Adam Smith, father of classical economics, whose name more than any other is connected with British laissez-faire doctrines. Smith believed that individual welfare rather than national power was the correct goal; he thus advocated that trade should be free of government restrictions. When individuals were free to pursue self-interest, the "invisible hand" of rivalry or competition would become more effective than the state as a regulator of economic life. Smith did not believe in laissez-faire in an absolute sense; he found a place for government activity in public works, such as the building of canals and docks to facilitate trade, and in the regulation of foreign commerce to protect certain home industries.

In the hands of Jeremy Bentham the doctrine of laissez-faire became a philosophy of individualism and of utilitarian ethics, and John Stuart Mill brought it to what was probably its highest point. The strong individualism of the theory naturally appealed to the factory owners and merchants of the Industrial RevolutionIndustrial Revolution,
term usually applied to the social and economic changes that mark the transition from a stable agricultural and commercial society to a modern industrial society relying on complex machinery rather than tools.
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, whose attempts to transform society along capitalistic lines were often hampered by old laws and the opposition of landed interests.

The so-called Manchester school of economics, especially Richard Cobden and John Bright, popularized the doctrines of free trade and laissez-faire, which, after initially being considered radical doctrines, were becoming the accepted theory of classical economics. Cobden and Bright, both successful businessmen, brought laissez-faire into the arena of politics: they secured the repeal of the corn lawscorn laws,
regulations restricting the export and import of grain, particularly in England. As early as 1361 export was forbidden in order to keep English grain cheap. Subsequent laws, numerous and complex, forbade export unless the domestic price was low and forbade import
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—mercantilist import duties that raised the price of food needed by the industrial workers—and they opposed even the minimal provisions of the factory acts that Parliament had passed in order to regulate such abuses as long hours and woman and child labor. Laissez-faire principles were nowhere embodied fully in legislation. Governments, at the very least, continued to levy tariffs as a means of protecting domestic manufacturers.


As the system of capitalist enterprise evolved in the 19th cent., more and more businesses found it in their interest to combine with their competitors in huge trusts or cartels in order to control prices and production. Competition, which had been expected to regulate the market, seemed instead to be encouraging monopoly. The principle of state noninterference was discarded; indeed, during the 20th cent. the state was often called upon to restore and preserve freedom of competition where it appeared to be in danger of disappearing. Agreements in restraint of trade and practices of "unfair" competition were outlawed. Thus the practice of laissez-faire was modified. The theory, however, was not abandoned; it became a tenet of the opponents of socialism. It was credited with lowering consumer prices by eliminating the high costs of competition. In that way, the emphasis in laissez-faire theory was shifted from competition to the importance of profit as an incentive to production and of individual initiative as necessary to economic progress.


See J. W. McConnell, Basic Teachings of the Great Economists (1943); F. W. Hirst, ed., Free Trade and Other Fundamental Doctrines of the Manchester School (1903, repr. 1968); A. W. Coats, ed., The Classical Economists and Economic Policy (1971).


political doctrine that an economic system functions best without governmental interference. [Politics: Misc.]
References in periodicals archive ?
[H.sub.3]: Corporate culture dimensions (competitive, entrepreneurial, Bureaucratic, and consensual dimensions) have significant and negative influences on Laisser-faire leadership style.
Data on the three managerial leadership styles (democratic, autocratic, and laisser-faire leadership styles) were also collected from the responses to the second survey questionnaire described in the section above on "survey instruments".
The dependent variables are the measures of the leadership style (democratic, autocratic, and laisser-faire styles).
Cet instrument comporte 46 enonces portant sur les dimensions transformationnelle, transactionnelle et du laisser-faire. La dimension transformationnelle est mesuree A l'aide de 25 items dont huit portent sur le facteur charisme, sept sur la stimulation intellectuelle et 10 sur la reconnaissance personnelle.
Il montre que le score moyen A la dimension du laisser-faire du leadership est le plus faible, suivi de celui A la dimension transactionnelle, alors que le score moyen le plus eleve se situe A la dimension transformationnelle.
Il a le merite de developper une argumentation serieuse en faveur d'une position de fermete qui contraste avec celle du laisser-faire generalement accepte a tous les niveaux.
Comment ne pas l'etre en effet quand on sait le laisser-faire et la complaisance qui president souvent a la delivrance aveugle des autorisations, sans s'assurer de la mise en oeuvre et l'application stricte des dispositions legales en matiere de la legislation du travail et des ouvertures de ce genre d'ateliers.
He added to the criticism of McCreevy: "Saying a laisser-faire policy must continue, as I have heard, is a mistake.
Un an lui aura suffi pour donner aux Tunisiens une impression de fiasco et de laisser-faire sans limite envers les franges les plus radicales de l'islamisme.
The ECBs current laisser-faire policy contrasts sharply with its tone at the beginning of 2004, when the Euro was close to today's rate (it reached the record rate of 1.2929 dollars in early 2004).
Nulle part et certainement pas dans la maniere de faire et la vitesse a laquelle les choses se font.Je trouve que les derapages auxquels on assiste actuellement sont dangereux et le laisser-faire auquel on assiste est encore plus dangereux.