The Markets’ Greatest Failure

The market usually works pretty well. Resources are distributed, transactions are made and the wheels of the economy keep turning. There are occasional glitches and problems though an unrestricted free market still retains many proponents. However, there is one area where the market has failed so catastrophically that even the market fundamentalists cannot defend it. This is the markets disastrous treatment of the environment and global warming. Continue reading “The Markets’ Greatest Failure”

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What We Don’t Know

For the free market to work it is assumed that everyone knows everything, or at least everything they need to know. However the world is full of things we know nothing about. This is the problem of asymmetric information, where one person knows more than the other. This creates many problems which hamper the operation of the free market and prevent it from reaching the perfect equilibrium. Continue reading “What We Don’t Know”