# Liberalization > Mediated Wiki article. Canonical URL: https://mediated.wiki/source/Liberalization > Markdown URL: https://mediated.wiki/source/Liberalization.md > Source: https://en.wikipedia.org/wiki/Liberalization > Source revision: 1326605546 > License: Creative Commons Attribution-ShareAlike 4.0 International (https://creativecommons.org/licenses/by-sa/4.0/) {{Use dmy dates|date=January 2023}} {{Short description|Relaxation of previous government restrictions}} {{Capitalism sidebar}} '''Liberalization''' ([American English](/source/American_English)) or '''liberalisation''' ([British English](/source/British_English)) is a broad term that refers to the practice of making laws, systems, or opinions less severe,[Cambridge Advanced Learner's Dictionary](/source/Cambridge_Advanced_Learner's_Dictionary): [https://dictionary.cambridge.org/dictionary/english/liberalization Liberalization] usually in the sense of eliminating certain government regulations or restrictions. The term is used most often in relation to [economics](/source/economics), where it refers to [economic liberalization](/source/economic_liberalization), the removal or reduction of restrictions placed upon (a particular sphere of) economic activity.[Oxford English Dictionary](/source/Oxford_English_Dictionary): [https://www.oed.com/view/Entry/107868 Liberalization] However, liberalization can also be used as a synonym for [decriminalization](/source/decriminalization) or [legalization](/source/legalization) (the act of making something legal after it used to be illegal), for example when describing [drug liberalization](/source/drug_liberalization). ==In economy and trade== {{main|Economic liberalization}} Economic liberalization refers to the reduction or elimination of government regulations or restrictions on private business and trade.{{cite book | last1 = O'Sullivan |first1 = Arthur | author-link = Arthur O'Sullivan (economist) | first2 = Steven M. | last2 = Sheffrin | title = Economics: Principles in Action | url = https://archive.org/details/economicsprincip00osul | url-access = limited | publisher = [Pearson Prentice Hall](/source/Pearson_Prentice_Hall) | date = 2003 | publication-place = New Jersey | page = [https://archive.org/details/economicsprincip00osul/page/n191 175] | isbn = 0-13-063085-3}} It is usually promoted by advocates of [free market](/source/free_market)s and [free trade](/source/free_trade), whose ideology is also called [economic liberalism](/source/economic_liberalism). Economic liberalization also often involves reductions of taxes, social security, and unemployment benefits. Economic liberalization is often associated with [privatization](/source/privatization), which is the process of transferring ownership or outsourcing of a business, enterprise, agency, [public](/source/public) service or public property from the public sector to the [private sector](/source/private_sector). For example, the [European Union](/source/European_Union) has liberalized gas and electricity markets, instituting a competitive system. Some leading European energy companies such as France's [EDF](/source/%C3%89lectricit%C3%A9_de_France) and Sweden's [Vattenfall](/source/Vattenfall) remain partially or completely in government ownership.{{citation needed|date=October 2015}} Liberalized and privatized public services may be dominated by big companies, particularly in sectors with high capital, water, gas, or electricity costs.{{citation needed|date=October 2015}} In some cases they may remain legal monopolies, at least for some segments of the market like consumers.{{citation needed|date=October 2015}} Liberalization, privatization and stabilization are the [Washington Consensus](/source/Washington_Consensus)'s trinity strategy for economies in transition.{{citation needed|date=October 2015}} The [Bretton Woods Conference](/source/Bretton_Woods_Conference) of 1944, which recommended the establishment of [International Monetary Fund (IMF)](/source/International_Monetary_Fund) ''and the [World Bank](/source/World_Bank)'', had also recommended the establishment of an [International Trade Organization](/source/International_Trade_Organization) (ITO). Although, the IMF and the World Bank were established in 1946, the proposal for ITO did not materialize. Instead, the [General Agreement on Tariff and Trade](/source/General_Agreement_on_Tariffs_and_Trade) ''(GATT)'', a less ambitious institution, was formed in 1948. The primary objective of GATT is to expand [international trade](/source/international_trade) by liberalizing trade so as to bring about all round economic prosperity. GATT was signed in 1947, came into effect in 1948 and lasted until 1994. It was replaced by the [World Trade Organization](/source/World_Trade_Organization) in 1995. The original GATT text (GATT 1947) is still in effect under the WTO framework. Thus liberalization was born.{{Citation needed|date=October 2020}} There is also a concept of hybrid liberalization. For instance, in [Ghana](/source/Ghana), [cocoa crops](/source/Theobroma_cacao) can be sold to competing [private companies](/source/Privately_held_company), but there is a minimum price for which it can be sold and all exports are controlled by the state.Marcella Vigneri and Paulo Santos (2007) "[http://www.odi.org.uk/resources/details.asp?id=422&title=ghana-cocoa-marketing-dilemma-liberalisation-without-price-competition-achieved Ghana and the cocoa marketing dilemma: What has liberalization without price competition achieved?] {{Webarchive|url=https://web.archive.org/web/20120307102105/http://www.odi.org.uk/resources/details.asp?id=422&title=ghana-cocoa-marketing-dilemma-liberalisation-without-price-competition-achieved |date=7 March 2012 }}", Overseas Development Institute The term liberalization has its origin in the political ideology [liberalism](/source/liberalism), which took form by the early 19th century. ==In social policy and government== In social policy, liberalization may refer to a relaxation of laws restricting certain practices or activities, such as [divorce](/source/Divorce_law_by_country), [abortion](/source/Abortion_law), or [psychoactive drugs](/source/Prohibition_of_drugs). Regarding [civil rights](/source/Civil_and_political_rights), it may refer to the elimination of [laws prohibiting homosexuality](/source/Sodomy_law), [private ownership of firearms](/source/Gun_ownership) or other items, [same-sex marriage](/source/same-sex_marriage), [inter-racial marriage](/source/Interracial_marriage), or [inter-faith marriage](/source/Interfaith_marriage).{{citation needed|date=October 2015}} There is a distinct difference between liberalization and [democratization](/source/democratization). Liberalization can take place without democratization, and deals with a combination of policy and social change specialized to a certain issue, such as the liberalization of government-held property for private purchase. Democratization is politically highly specialized; it can arise from a liberalization but works on a broader level of governmental liberalization.{{citation needed|date=October 2015}} ==See also== {{Portal|Law|Liberalism|Libertarianism}} {{div col}} * [Artistic freedom](/source/Artistic_freedom) * [Civil libertarianism](/source/Civil_libertarianism) * [Cultural liberalism](/source/Cultural_liberalism) * [Decriminalization of sex work](/source/Decriminalization_of_sex_work) * [Deregulation](/source/Deregulation) * [Drug liberalization](/source/Drug_liberalization) * [Emancipation](/source/Emancipation) * [Energy liberalisation](/source/Energy_liberalisation) * [Free trade](/source/Free_trade) * [Freedom of speech](/source/Freedom_of_speech) * [Freedom of thought](/source/Freedom_of_thought) * [German reunification](/source/German_reunification) * [Libertarianism](/source/Libertarianism) * [Liberty](/source/Liberty) * [Marketization](/source/Marketization) * [Oligopoly](/source/Oligopoly) * [Sex-positive movement](/source/Sex-positive_movement) * [Sexual revolution](/source/Sexual_revolution) * [Social liberalism](/source/Social_liberalism) {{div col end}} == References == {{Reflist}} {{Authority control}} Category:Market structure Category:Economics of regulation Category:Law reform --- Adapted from the Wikipedia article [Liberalization](https://en.wikipedia.org/wiki/Liberalization) by Wikipedia contributors ([contributor history](https://en.wikipedia.org/wiki/Liberalization?action=history)). Available under [Creative Commons Attribution-ShareAlike 4.0 International](https://creativecommons.org/licenses/by-sa/4.0/). Changes may have been made.