What is the third way?
The Third Way is a centrist political approach that tries to combine free-market economics with social justice. It rejects both old-style state socialism and pure free-market conservatism. It was associated with New Labour in Britain in the late 1990s and with the Democrats in the United States.
The idea grew in the 1990s, after the end of the Cold War and long periods of right-wing government in Britain and the US. Centre-left parties believed they needed to accept markets and globalisation to win again. The sociologist behind much of the theory argued for a new path between old left and new right. Similar ideas spread to Europe.
In Britain, New Labour won the 1997 election with a large majority on this approach. It kept much of the market reforms of the 1980s and granted the Bank of England independence. It also introduced a minimum wage, tax credits for working families and big increases in health and education spending. Public services were reformed using targets, choice and private finance.
Supporters say the Third Way showed the centre-left could win elections and run the economy while cutting child and pensioner poverty. Critics on the left say it was too close to big business and finance, especially before the 2008 crash. Critics on the right say it grew the state and relied on borrowing. Its legacy still shapes centrist politics. Few politicians now use the label.
Where you've seen it
The UK Labour governments of 1997 to 2010, the US in the 1990s, and Germany's centre left reforms in the early 2000s.
In the UK today
Its legacy appears in academies, the minimum wage, independent Bank of England, tax credits and the continuing debate over how far Labour should be pro-business.
Much of the left criticises the Third Way as too pro-market, though its supporters say it delivered real gains for poorer families.
The right often sees the Third Way as a clever repackaging of big government that raised spending and debt.
Britain is split. Now you decide.
In WeDecide you can try to find a Third Way in your own Budget, balancing growth, fairness and the books.
Play WeDecide freeCommon questions
What was New Labour?
The name for the Labour Party's Third Way approach from the mid-1990s until 2010.
Is the Third Way left or right?
It is centrist, usually seen as centre-left.
What policies were part of the Third Way?
Examples include the minimum wage, tax credits, Bank of England independence and public service reform.
What did the third way try to combine?
Market economics with social justice. The third way tried to combine market economics with social justice.
Which UK governments are the main example of the third way?
Labour governments of 1997 to 2010. The UK Labour governments of 1997 to 2010 are the main UK example.