The theory of laissez faire suggests that a government should not intervene in the economic system or moderate it.
It suggests that an economic system should be driven only by market forces. Laissez faire is a French phrase that means to allow to pass, or let go.
Adam Smith, a Scottish economist, is the man who proposed this belief. He believed that humans are naturally motivated by self - interest and when their economic activities are not interfered with, a balanced system of production and exchange based on mutual benefit emerges.