What are the basic principles of a free market economy?

The basic principles of a free market economy are;

1. Individual rights

2. Limited government

3. Equal justice under law

4. Subsidiarity

5. Spontaneous order

6. Property rights

7. The golden rule

Explanation:

A free market is an economic model where the laws of demand and supply usually control how the market behaves without any or little intervention from the government. Although, getting an economy that is purely free market economy is almost impossible, there are those that have minimal government regulations. The basic principles of a free market economy are as shown;

1. Individual rights; this means that each individual has the right to contractual exchange and thus can buy or sell his/her property with minimal influence from the government

2. Limited government; government influence in terms of regulation authorities is limited to a certain degree to allow individuals a bigger degree of freedom in economic transactions

3. Equal justice under law; this means that the law applied to everyone:the law must not be applied selectively. This means that failure should not be rewarded and neither should success be punished.

4. Subsidiarity; authority from the government if any, should be at the lowest level possible.

5. Spontaneous order; when all the individual rights are respected and government regulation is kept at a minimum, this will create competition which improves quality and reduces the price.

6. Property rights; private ownership of resources ensures the best utilization of the resources.

7. The golden rule; when individuals deal with others honestly, they will get an honest return.