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> Because that's not how it works Exactly! I don’t know how to deal with people who talk about the economy in terms of a perfect competition free market where
by mcny 3y ago
> Because that's not how it works
Exactly!
I don’t know how to deal with people who talk about the economy in terms of a perfect competition free market where all participants have full knowledge and are all equal in terms of power. If a physicist talked in terms of zero friction or spherical cows, we would laugh them off and never listen to them again. And yet people continue to talk about the economy with these assumptions that make zero friction and spherical cows look like practical applied physics.
- WalterBright 3y agoI don't know where the requirement of full knowledge became part of the definition of a free market. Because it isn't true. Another word for lack of knowledge is "risk". The amount of risk is factored into the price of everything you buy and sell. For example, a name brand item sells for a higher price than a generic item because the name brand carries with it less risk for the buyer.
- WalterBright 3y agohttps://en.wikipedia.org/wiki/Free_market https://en.wikipedia.org/wiki/Free_market Note that "perfect information" is not part of the definition of it.
- nec4b 3y agoYou will be in shock when you'll see in what terms mathematicians talk about.