"The economic theory basic to the principles of capitalism, propounded by the French physiocrats and popularized by Adam Smith (The Wealth of Nations, 1776), that calls for a "hands off" policy of government toward the economy. Laissez-faire rejects state control and regulation and emphasizes economic individualism, a market economy, and natural economic laws to guide the production and consumption of goods....The economic system becomes self-regulatory in nature, and each individual's pursuit of self-interest contributes to the well-being of all....The wide acceptance in practice of the theory of laissez-faire in the Western world during the eighteenth and nineteen centuries ushered in the new economic era of capitalism. Laissez-faire was largely a reaction to the severe production and trade restrictions imposed by governments under the previous system of mercantilism. The American Revolution was a product of these economic forces of change, as well as of new political ideas based on individualism".
from: Plano and Greenberg, The American
Political Dictionary