What is “Shock Policy’ as defined in neoliberal application?

"Shock Policy" in the context of neoliberal application refers to the rapid implementation of economic reforms. This term is often associated with policies that are introduced suddenly and forcefully, often in times of economic crisis.

Here are the steps to understand it:

1. Understanding Neoliberalism: Neoliberalism is a policy model that encompasses both politics and economics and seeks to transfer control of economic factors from the public sector to the private sector. It is a philosophy that suggests that societies can best achieve economic prosperity and social welfare through free market methods.

2. Understanding Shock Policy: The term "Shock Policy" or "Shock Therapy" is used to describe the sudden release or drastic change in policies that leads to rapid economic liberalization. This can include measures such as cutting tariffs, deregulating industries, privatizing state-owned enterprises, reducing the size of the state, and reducing inflation.

3. Neoliberal Application: In the context of neoliberalism, "Shock Policy" refers to the rapid and often unexpected implementation of neoliberal reforms. This is often done in response to a crisis, with the belief that the shock of the changes will allow for a quick transition to a more efficient and prosperous economy.

4. Examples: A famous example of shock policy is the economic reforms in Chile under the dictatorship of Augusto Pinochet, where neoliberal economists known as the "Chicago Boys" implemented drastic economic liberalization policies. Another example is the transition economies of Eastern Europe after the fall of the Soviet Union, where countries like Poland and Russia implemented shock therapy to transition from a planned economy to a market economy.

In conclusion, "Shock Policy" in neoliberal application refers to the sudden and drastic implementation of economic reforms aimed at liberalizing the economy and reducing the role of the state.