A general term for underdeveloped nations, the term Global South was first used during the Cold War. However, the term gained popularity after the Cold War, when the prevailing term for poorer countries was the “third world” (as distinguished from “first world” nations aligned with the US and “second world” nations aligned with the Soviet Union). The term, along with its opposite, “Global North,” correlates heavily with the experience of colonialism and other forms of political and economic dominance, since nearly all Global South nations were formal or informal subjects of a Global North nation. The term is meant to denote the common problems facing modernizing nations of all political and cultural backgrounds.

An economic philosophy that emerged after World War II, neoliberalism stood in contrast to the then-dominant school of Keynesianism, named after British economist John Maynard Keynes. Keynes and others looked to governments to oversee fiscal and monetary policy in order to safeguard people against the instability of capitalism and, most importantly, to ensure full employment. Looking to the example of 18th-century “classical liberals” like Adam Smith and David Ricardo, the “neoliberals” deplored governments as a wasteful interference in the natural workings of the free market and called for governments to act mainly with the aim of getting out of the way.