Free markets and Government

11 Aug

F.A. Hayek in The Road to Serfdom,

To create conditions in which competition will be as effective as possible, to supplement it where it cannot be made effective, to provide the services which, in the words of Adam Smith, “though they may be in the highest degree advantageous to a great society, are, however, of such a nature, that the profit could never repay the expense to any individual  or small number of individuals”, these tasks provide indeed a wide and unquestioned field for state activity. In no system that could be rationally defended would the state just do nothing. (emphasis added)

To summarize, free markets does not mean no government. This may seem like an obvious fact, but a lot of heartburn between interventionists and free marketers will be avoided if we keep the above in mind.


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