Written by the Fiveable Content Team • Last updated September 2025
Written by the Fiveable Content Team • Last updated September 2025
Definition
Laissez-faire is an economic philosophy of free-market capitalism that opposes government intervention. It advocates for the natural regulation of markets through the laws of supply and demand.
Related terms
Free market: An economic system where prices are determined by unrestricted competition between privately owned businesses.
Often referred to as the father of modern economics, he advocated for laissez-faire economic policies in his seminal work, "The Wealth of Nations."
Invisible hand: A metaphor introduced by Adam Smith to describe the self-regulating behavior of the marketplace, guiding individuals to unintentionally benefit society through pursuing their own interests