The main schools of neo-liberal economics.

Neo-liberal economics has attracted worldwide attention, which originated from a big debate about market and government planning in the 1920s and 1930s. On the one hand, Austrian economists Mises and Hayek led neoliberalism. On the other hand, there are market socialists represented by Italian economist Barahona and Polish economist Langer. This debate ended without results, but it became a milestone for neoliberalism to enter the historical stage. Since then, after nearly a hundred years of development, neoliberal economics has deduced many schools and theoretical systems. Narrow neoliberalism mainly refers to the neoliberalism represented by Hayek; Generalized neoliberalism includes not only London School and Neo-Austrian School represented by Hayek, but also Chicago School represented by Hayek, Friedman, stigler and Coase, Monetarism represented by Friedman, Rational Expectation School represented by Lucas and Barrow, New Institutional School represented by Coase, Public Choice School represented by Buchanan and Supply School represented by Raphael and feldstein, among which the most influential ones are.

The main representative of London School is Hayek, who is the most representative thinker of contemporary neoliberalism. He is a famous economist and theorist who was born in Austria. His neo-liberal theory is the main ideological source of all other neo-liberals. He has long been active in neo-liberal centers that oppose Keynesianism and state intervention: University of Vienna, Austria, University of Chicago, and School of Economics, University of London, England. He is not only the main representative of London School who advocates economic freedom, but also the core member of Chicago School and the backbone of Austrian School. He believes that freedom is the highest political goal, the lofty goal of pursuing civilized society and the guarantee of private life safety. According to the principle of liberalism, we should try our best to use our power and try our best to deal with things with less coercion. He emphasized that private ownership is the most important guarantee of freedom, and individual's "enthusiasm" can only be fully exerted on the basis of private ownership. If private property is restricted and managed and the market function is replaced by state intervention, the result will not only be the loss of efficiency, the frustration of individual enthusiasm and the imbalance of resource allocation, but also the "totalitarian rule" and "slavery" of individuals. Hayek attributed socialism, monopoly capitalism and fascism to totalitarianism and put forward that fascism = monopoly capitalism = socialism.

Monetarism is a bourgeois conservative economic school that rose in the United States in the early 1960s. Friedman, the leader of this school, defended the capitalist free market economy and firmly believed that the most ideal economic system should follow the ancient laws of the free market, thus becoming an advocate and defender of laissez-faire thought in economics. He believes that the capitalist system is unstable because money is disturbed, so money is the most important factor, and money is the only important factor that dominates capitalist output, employment and price variables. In addition, there is no need for the government to intervene in the private economy, but to give full play to the role of the market mechanism. As long as the market mechanism is brought into full play, the capitalist system itself can be stable.

The school of rational expectation thinks that people are rational and always pursue the maximization of personal interests. Because the future situation of economic variables is related to their own choices and interests, individuals will use their intelligence and resources to speculate on them as accurately as possible. People will make full use of all available information and make predictions about the future of economic variables according to their own knowledge and experience. Due to the role of rational expectation, the market mechanism can ensure a full employment balance, and the government's policy of intervening in the economy is either ineffective or exacerbates economic fluctuations, which is unnecessary. From this, we can draw a classic conclusion: the country will not do better than individuals or enterprises, and the free market competition mechanism is still the best mechanism for economic development. Lucas, a professor at the University of Chicago, is the representative of this school. Based on the hypothesis of economic man's rational behavior and rational expectation, he demonstrated and explained the causes of economic fluctuations with the monetary cycle model, and concluded that Keynesian policies were invalid and there was no need for the government to intervene in the economy. He emphasized the stability and continuity of economic policies, which triggered the "rational expectation revolution" in the field of macroeconomics.