A development strategy that advocates free markets, free trade, and minimal government intervention is called ...

• A. Mercantilism
• B. Neoliberalism
• C. Social Democracy
• D. Keynesianism

Answer: (B)

Free markets, open trade, and a small government role define neoliberalism. It argues that markets allocate resources most efficiently when barriers are low, so trade is liberalized, regulation is reduced, and the state’s involvement in the economy is minimized, often accompanied by privatization of state-owned enterprises and limited fiscal intervention. This approach rose to prominence in the late 20th century as a reform agenda in many countries. Mercantilism centers on protectionism and state-directed accumulation of wealth; social democracy emphasizes extensive welfare and active government intervention; Keynesianism relies on government spending and demand management to smooth economic cycles. So the description best matches neoliberalism.