Laissez-faire policies lapsed in response, at least in part, to exaggerated business cycle swings in the aggregate economy.

Question

Quizplus · Accepted Answer

Laissez-faire policies are based on the idea that the government should not intervene in economic affairs. However, during times of economic crisis, such as the Great Depression, it became clear that unregulated markets could lead to severe economic downturns. As a result, laissez-faire policies lapsed in response to the exaggerated swings in the business cycle, at least in part.

Laissez-Faire Policies Lapsed in Response, at Least in Part, to Exaggerated