ABSTRACT
Economic theory and policy across the world are currently dominated by neo-liberalism. Its adherents believe that free markets have beneficial economic properties, and that there is no alternative to markets in organising economy and society. The neo-liberal outlook has held sway for more than two decades in the USA, Europe and Japan, while being gradually imposed on the developing world. Yet its results have been deeply disappointing. Since the early 1980s, growth rates have been generally poor, real incomes have stagnated and the productivity of labour has risen uncertainly and haltingly. Meanwhile, income inequality has widened, absolute poverty in the developing world is vast, and economic instability (partly due to a succession of financial bubbles) has become an entrenched part of life. Free markets have performed less well than their advocates either expected or wished.
