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Free-Market Policies

Free market economic reforms reduce the influence of the state within the economy, allowing the prices of goods and services to be set by market supply and demand and allowing private producers and consumers to determine what is produced within the economy. Technocrats in Franco's cabinet introduced radical free-market reforms from 1959, starting with the Stabilisation Plan which ended price controls and lifted restrictions on trade with other nations. The reforms paved the way to rapid economic improvements as Spain attracted huge amounts of foreign investment into its car and electronic industries. This, along with the growth of tourism in Spanish coastal towns, facilitated the creation of jobs and a rise in living standards. However, the reforms did lead to inequalities in income and wealth widening across the country as not everyone benefitted from Spain's 'economic miracle'.

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