Laissez-faire Capitalism

Definition

Laissez-faire capitalism is an economic system in which transactions between private parties are free from government intervention such as regulations, privileges, tariffs, and subsidies.

Related terms

Free Market: An economic system in which prices are determined by unrestricted competition between privately owned businesses.

Supply and Demand: An economic model of price determination in a market. It postulates that in a competitive market, the unit price for a particular good will vary until it settles at a point where the quantity demanded equals the quantity supplied.

Deregulation: The process of removing or reducing state regulations typically in the economic sphere. It is the undoing or repeal of governmental regulation of the economy.