embedded vs. disembedded liberalism

Clearly, a combination of the two types of markets is most realistic and desirable, a system in which we can choose which type of liberalism (embedded or disembedded) to follow depending on the state of the market.

However, if I could only choose one, I would choose a market system operating under disembedded liberalism. Honestly, there is enough red tape for both businesses and individuals wishing to participate in the financial market already; adding more restrictions through embedded liberalism certainly would not help that situation. We want business to flourish, not to be weighed down by overbearing "grammar." So while certain rules are necessary to that the market can exist and function properly, more laws are unneeded. The government has more than enough responsibilities already, so by leaving the financial market in a laissez-faire state, unless emergency strikes, frees them to deal with more pressing matters.

Additionally, a disembedded market encourages interdependence among international countries and corporations more so than an embedded market which tends to promote autonomy and self-sufficiency before trade. As any economics student can (or should be able to) tell you, countries benefit when they specialize in producing a product for which they have comparative advantage and trade for other products. While surviving only upon what your country produces may have been necessary or practical at a time when travel was more difficult, that is no longer an excuse. As technology progresses - due to information trade - transporting products will become even cheaper and easier. We stated in class that embedded liberalism would make the world market less fragile; if one country's economy were to crash, the rest of the world would not suffer. However, the benefits that come from depending upon each other severely outweigh this possible loss; though this happened during the Great Depression, we now know the cause and the signs that led up to the Great Depression so that we may avoid any similar situation.

Though disembedded liberalism is not for developing countries, many of whose people need welfare and aid in starting new businesses, in a country such as the U.S., the majority can prosper under a more open set of rules. With too many restrictions, our innovation will be severely restricted as will our ability to prosper to the fullest of our potential.