Neo-Liberalism, Neoclassical Economics, and Foucault: Dominant Schools of Economic Thought in American Anarcho-Liberalism and German Ordoliberalism

28 Pages Posted: 20 Oct 2020 Last revised: 8 Apr 2021

See all articles by Koen Smeets

Koen Smeets

Radboud University Nijmegen - Nijmegen School of Management

Date Written: April 3, 2021

Abstract

This paper examines the influence of American and German neo-liberalism on the dominant school of economics in their respective countries based on an extended version of Foucault’s The Birth of Biopolitics. The analyses of the American neo-liberal economists, or anarcho-liberalists, legitimised the extension of the basic neoclassical model to non-economic, social phenomena and invalidated governmental intervention in both economic and social phenomena. In contrast, the assumption of the German neo-liberals, or Ordoliberals, of markets as artificial, imperfect constructs validated setting the right conditions for the market by the government. This analysis demonstrates and draws lessons from the historical conditions under which a school with divergent assumptions from the neoclassical assumptions of perfect rationality and perfect competition became dominant in a neo-liberal political-economic environment.

Keywords: neoliberalism; neoclassical; Foucault; The Birth of Biopolitics; economics

Suggested Citation

Smeets, Koen, Neo-Liberalism, Neoclassical Economics, and Foucault: Dominant Schools of Economic Thought in American Anarcho-Liberalism and German Ordoliberalism (April 3, 2021). Available at SSRN: https://ssrn.com/abstract=3684056 or http://dx.doi.org/10.2139/ssrn.3684056

Koen Smeets (Contact Author)

Radboud University Nijmegen - Nijmegen School of Management ( email )

Thomas van Aquinostraat 3
P.O. Box 9108
Nijmegen, 6500HK
Netherlands

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