American Institute of Certified Planners (AICP) Practice Exam

Which ideology supports the idea that individual hardships from competition ultimately benefit the state?

1. Methodism

2. Utopianism

3. Laissez Faire

4. Transactive Planning

The correct answer is: Laissez Faire

Laissez-faire is an economic ideology that advocates for minimal government intervention in the affairs of the economy. The foundational belief of laissez-faire is that markets function best when there is free competition, where individuals pursue their self-interests. Proponents of this ideology argue that while individuals may face hardships and competition can create challenges, these struggles ultimately lead to increased efficiency, innovation, and economic growth. As individuals compete, they are forced to improve their skills and products, leading to better outcomes not only for themselves but for the economy as a whole. This process is believed to create a more dynamic and productive state where resources are allocated efficiently, and overall societal progress is achieved, as the benefits of competition flow through to the population at large. In contrast, other options like Methodism and Utopianism do not align with the concept of competition leading to overall benefit in the same way; Methodism focuses on moral and social responsibility rather than economic competition, while Utopianism envisions an ideal society where competition is absent or minimized. Transactive Planning emphasizes negotiation and collaboration among stakeholders, which diverges from the competitive individualism central to laissez-faire ideology.