Let's distinguish among three uses of "neo-Liberalism:"
- The imposition of markets absent rule by discussion (imperfectly approximated in Liberal Democracies)--often, by way of a dictator, foreign aid institutions [IMF, World Bank, etc.], foreign experts [e.g., Post-Communist Russia]); this is generally associated with 'shock therapy' of some sort and often occurs in times of 'crisis' or 'emergency.'
- The use of market-friendly-rhetoric within democracies to justify "privatizing" government services; the privatized entities become private (quasi-) monopolies managed by a rent-seeking, credentialed, managerial class.
- The tendency by the financial services industry to 'privatize gain and socialize risk' at the expense of their much poorer fellow tax-payers.
Now (2) and (3) are deplorable, but only (1) primarily involves social engineering by experts.
Of course, in practice (1-3) can be blended in all kinds of ways: often the 'privatized' industries come with various implicit government guarantees, so then an instance of (2) turns into an instance akin to (3). There may be more uses of "neo-Liberalism" that I am overlooking, of course! But I want to distinguish between these three varities of neo-Liberalism from instances of what is known as "economic imperialism." Economic imperialism occurs when the methods and doctrines of economics are extended into domains not previously associated with economics. Gary Becker's work on the family is a paradigmatic instance of economic imperialism. (As I have pointed out "economic imperialism" predates Becker; it was probably first diagnosed by the sociologist Talcott Parsons a few generations before Becker.)
Neo-Liberalism and economic imperialism are both commonly associated with so-called "Chicago economics." But distinct aspects of economics have been brought to bear to support the varieties of neo-Liberalism. In my previous blogging I have focused quite a bit on how aspects of finance theory paved the way for (3). Below I focus on the way the economics profession became/is implicated in (1). A key figure is the "Chicago"-economist, Arnold Harberger. Harberger's entanglement with neo-Liberalism is not merely academic; he was the key mentor to the Chilean (and other Latin American) "Chicago Boys" prior to and at the time of the dictatorships of the 1970s. The understandable focus on Milton Friedman by critics of "Chicago" has made informed discussion of these matters more complicated. As I have tried to explain, there are genuine technical differences in the ways Friedman and Harberger practice economics. (This is not meant to exonerate Friedman's role(s) in (1-3) nor his attempts at defending the Chicago Boys [see my piece].)