International Business Essay Example | Topics and Well Written Essays - 500 words - 5

International Business - Essay Example hift in the policy happened is the question to be discussed in this essay as it will analyze as to why the government withdrawn from intervening in the market and what may have changed over the period of time. In UK, the architects of the free market policies were Margret Thatcher who was largely considered as the Prime Minister with the mandate to reverse the economic decline of UK. The major influence on Margret Thatcher was from Milton Friedman- a Noble Prize winning economist whom she described as the reviver of economics of liberty.(Cornwell,2006). It started with the privatization process initiated basically in order to make institutions more competitive because of the long term chronic problems of the UK economy. The process of privatization was slow and done in phases where the government gradually sold their stakes in the public enterprises to make them function under the private management in order to make them more efficient. (Cook, 2009). The long term failure of fiscal economics as UK was facing strong inflationary pressures. The policy response from Thatcher government was to gradually decrease the State intervention into the affairs of the free market by leaving them on the ir own to float and regulate the market. Further, the initial steps also included banning unionism within the organizations to increase their efficiency and at the same time providing rights to the workers in order to balance the power within the organizations. Another very important measure taken while making a stride towards free markets was the fact the monetary policy was made largely independent. However, it was largely directed at controlling and managing inflationary pressures on the economy. Interest and tax rates were cut besides reducing expenditure on the social security nets in a bid to lessen the influence and intervention of government from the market. As a result of this, UK witnessed a gradual decrease in its inflation and could achieve growth rates which were