Free market, on one hand, is considered as an economic system where consumers and open market features determine the prices of goods and service, the government does not intervene in the laws of supply and demand or monopolize price setting. On the other hand, it defines economic systems featuring inequality of bargaining power, significant market power, and less than free inequality of information asymmetry. Some experts have contrasted the free market concept and that of regulated markets where the government not only intervenes but also set economic policies and intervenes in the supply and demand. The ‘free market’ concept has been one of the most controversial in economics and governance. While capitalists strongly believe in the existence and effectiveness of free markets, their opponents think otherwise. In fact, the latter group tend to think that free markets are just as regulated as actual regulated markets. The opponents also base their argument on the claim that free markets are exploitative products of capitalism, thus, its existence is meant to pivot and support capitalism. Power (852-853) notes the principles by which the free market (an illusion to others) operates. The principles include individual rights which hold that everyone is created with equal personal rights to not only control but also defend their lives and properties. The government’s reach is limited in a free market economy. In particular, governments are reduced to mere institutions that guard the individual rights and acts a certain way only with the consent of the individual. Similarly, the government is expected to act justly and treat everyone in equal measures in accordance with the law. The authority of the government, therefore, should be at the lowest feasible level. Finally, free-market views privatization as the most efficient way of sustaining the utilization of resources. On paper, considering these principles, free market seems entirely feasible and plausible, thus, existent. However, critics are rife with the argument supporting the existence free-markets in the economy.
The gridlock can be unlocked by attempting to answer the question, ‘can a market exist without government regulation?’ Yes, it can exist, but more theoretically than practically. Concerning demand and supply, a free market is as free as the name suggests. In particular, individuals and firms involved in business transactions can enter the market, participate or leave as they please (Harcourt, 7). Minus government intervention, prices of commodities and services rise and fall with respect to the prevailing economic conditions, until an equilibrium is attained. This condition may not be feasible in reality. While free markets keep governments away from interfering with the market, the contribution of governments, regulation, has always defined the success of market from time immemorial. In many countries throughout the world, governments still intervene in the so called free markets for various reasons (House, 19). Achievement of political and social agendas linked with the economy can only be efficient with the intervention of the government. In particular, the institution may intervene in the free market with a view to creating social equality through such actions as setting a threshold for the minimum wage or instituting price control checks-and-balances. On the same note, taking the issue of minimum wages vis-à-vis the free market principles, the lack of regulation is likely to have various companies having their won minimum wages. In that case, there is a possibility of having a thousand companies will with different minimum wages. Such a system is in shambles, and is unsustainable. Besides, other companies may decide to have minimum wages that are low to an extent of not supporting the basic living standards of the workers. Supporters of the free market concept often argue that governments just force themselves to intervene in free markets (Power, 852; Harcourt, 7). Arguably, such interventions are inevitable.