Knowra Economic liberalization Economic liberalization Economic liberalization reduces government restrictions on economic activity, expanding the role of markets and private enterprise through measures such as deregulation, privatization, and trade opening.
Deregulation : The removal or relaxation of government rules governing economic activity. It reduces constraints on firms and markets without necessarily changing ownership.
Deng Xiaoping : Chinese leader whose reforms beginning in 1978 introduced market incentives while retaining Communist Party rule. His reforms launched China's gradual opening to markets and foreign investment.
Economic growth : An increase over time in the production of goods and services in an economy. Reformers often expect market expansion and investment to raise output.
Command economy : An economic system in which central authorities make major decisions about production, prices, and resource allocation. It places economic decisions under more direct state direction.
Sequencing of economic reforms : The ordering of policy changes during a shift toward a more market-oriented economy. Opening trade, finance, and domestic markets in different orders can produce different risks.
Privatization : The transfer of ownership or control of assets and enterprises from the public sector to private actors. It changes who owns or operates state enterprises.
Polish economic transformation : Poland's transition from a centrally planned economy to a market economy beginning in 1989. It exemplifies rapid liberalization after communist rule.
Income inequality : The unequal distribution of income among individuals or households in a population. Market-oriented reforms can distribute gains and losses unevenly.
Mixed economy : An economic system combining private markets with government ownership, regulation, or provision. Liberalization changes the balance within a mixed economy rather than necessarily ending it.
Financial liberalization : The removal of government controls on interest rates, credit allocation, and financial institutions. Its effects depend on regulation, institutional capacity, and the pace of opening.
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