Laissez-faire Capitalism

Laissez-faire is a doctrine and variant of capitalism holding that government should interfere as little as possible in the economic affairs of individuals and markets, leaving prices, production, and trade to be governed by private decision-making and competition. Its legitimacy claim rests on the same presumption of a prior individual right to one's own labour and property that broader liberal and capitalist theory relies on, with laissez-faire adding that the state has no reliable capacity to improve on the outcomes free exchange produces on its own, so restraint is required rather than merely permitted. The term, French for let do or leave alone, is traditionally traced in folklore to a reply French industrialists reportedly gave finance minister Jean-Baptiste Colbert under Louis XIV when asked how government could help business. The doctrine was formally developed by the Physiocrats in France from about 1756 to 1778 and gained strong theoretical support from classical economics following Adam Smith's Wealth of Nations, with its popularity as a governing philosophy peaking around 1870. The disruptions of industrialization and mass production later exposed its limits, and it substantially yielded to Keynesian economics following the Great Depression of the early 20th century. The atlas records no single honest origin year for laissez-faire, since its folkloric origin traces to the reign of Louis XIV while its formal development as an economic school runs from about 1756 to 1778 under the Physiocrats.