Final answer:
Laissez-faire economics, also known as "hands off" capitalism, refers to a system where the government minimally interferes in the market, a concept that reached its peak in the late 19th century U.S. but later saw increased regulation due to emerging economic issues.
Step-by-step explanation:
The term "hands off" capitalism you're referring to is known as laissez-faire economics. It's a system where the government exercises minimal interference in the economic affairs of individuals and businesses. The idea is that the free market, operating on its own, is the best regulator of the economic system, ensuring efficiency and growth. Government intervention is limited to maintaining the rule of law and property rights but doesn't extend to regulating markets or direct economic intervention.
Laissez-faire capitalism reached its peak in the United States during the late 19th century, notably during the period of industrialization. Without significant government constraints, businesses could operate freely. However, issues such as monopolies and poor working conditions eventually led to calls for more government intervention. This resulted in antitrust laws, the regulation of working conditions, and the implementation of other controls to curb the excesses of unfettered capitalism.
It is important to note that while laissez-faire advocates for minimal government involvement, complete absence of government in markets is not practical and does not reflect historical or current economic systems fully. Government institutions play a role in upholding the conditions for markets to function, such as enforcing contracts and protecting property rights.