A word which has to be used very carefully in international contexts, since it and its cognates have (at least) three conflicting meanings. Basically:

  • In the USA, means a (probably dangerous, drug addled) left-wing movement, spawn of the demonic 1960s and deeply un-American. Or to a European that seems to be how it gets used, anyway. The locals have covered it more extensively in other writeups here. This usage specifically contrasts with "conservative".
  • In the UK, the Liberal party (now the Liberal Democrats) is a traditional centrist, faintly green-tinged but anti-organised-labour party, until recently squeezed between the Labour party to its left and the Conservatives on its right. The stereotypical liberal is a sandal wearing beardy academic who probably knits his own tofu. They don't really contrast with anything (although possibly Vladimir Zhirinovsky's Russian "Liberal democrats" - an extreme nationalist party who chose the name just to bring it into disrepute - might be considered as close to polar opposites as you are likely to get. The UK Liberal Democrats are the successors to the Liberal Party (after merging with the SDP, a then-moderate schism of the old Labour Party), who in turn were the successors to the Whigs in the 19th century, who were roughly speaking economic liberals as described below.
  • Throughout continental Europe, applies to parties and philosophies which were deemed dangerously radical in the aftermath of the Napoleonic Wars, standing for individual freedom and against the divine right of kings and that sort of thing, but which have become more than mainstream in the intervening couple of centuries. Their titular heirs and successors are secular, free trade promoting parties of varying degrees of importance on the conservative, free trade right of the political spectrum (eg the VVD in the Netherlands and the Partito Liberale in Italy). This is also the sense to which "economic liberal" and "neoliberal" relate, and in broad terms it contrasts with "socialist".
  • In Australia, the Liberal Party is the more right-wing of the two major political parties, broadly aligned with the British Conservative Party or the main American parties.

In economics, "liberal" tends to be applied to free market policies in general; thus Reaganomics was (at least supposedly) pure economic liberalism; the WTO is a profoundly liberal organisation. So, boys and girls, be careful who you're talking to when you use the term, since they'll probably assume you meant something completely different ...