Formed in the 1930s but shaped policy from the post-war period.
Ordoliberalism
What rules does a market economy need so that neither monopolies nor governments abuse power?
The 30-second version
Germany's answer to the 1930s: a strong state that sets firm rules, protects competition and keeps prices stable, then steps back. It shaped EU competition law, the ECB and the euro's fiscal rules. Critics say those rules made the euro crisis worse.
Big questions it works on
Go deeperKey ideas, thinkers, evidence and where it stands today
Key ideas
- A strong state sets and enforces the rules, then stays out of day-to-day markets.
- Competition must be protected actively; cartels are a threat to freedom.
- Price stability and sound public finances come first.
- The “social market economy” of post-war West Germany.
Key thinkers
Walter Eucken, Franz Böhm (Freiburg school); Ludwig Erhard as the politician who applied it
What it got right
Main criticisms
Evidence worth knowing
The Maastricht limits (deficit 3% of GDP, debt 60%) reflect this rules-first tradition.
Where it stands today
Influential in German and EU policy. Essential background for anyone studying European integration.
Family line
Reacting against both laissez-faire monopolies and the Nazi command economy.