# What made Friedman believe real-life markets are rational? **URL:** \ **Category:** Great Debates\ **Created:** [November 11, 2008, 10:08pm UTC](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252 "2008-11-11T22:08:54Z")\ **Posts on this page:** 20\ **Page:** 2
**Author:** ![wmfellows](https://avatars.discourse-cdn.com/v4/letter/w/c2a13f/32.png) [@wmfellows](https://boards.straightdope.com/u/wmfellows)\ **Post date:** [November 12, 2008, 12:58am UTC](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252/21 "2008-11-12T00:58:34Z")
> [@Der\_Trihs](#): > > I do think it’s politically driven. As I said in my first post; unless you assume that people are perfectly rational and perfectly informed, they’ll make bad decisions, decisions that go against their own and/or everyone else’s interest or even survival. So, you need government intervention and support to keep the market and the rest of society from falling apart. This economic idea that people are all perfectly rational mainly serves as an excuse for cutting government and regulations under the claim that they aren’t **necessary**. That the market will act in enlightened self interest and take up the slack even if you reduce the government to nearly nothing, which doesn’t **work**. Mate, you either don’t understand a proper economist’s use of the term rationale or don’t wish to use it. Never mind you rather grossly mischaracterise Freidman. The idea of rationality in economics most certainly is not mainly about reduction of government. The concept focuses on the reasonable (if not perfect, certainly) supposition that most of the time people have coherent hierarchies of preferences, and typically speaking free exchange between rational actors [as defined] is an efficient mechanism for balancing offer with demand. While it certainly strikes a blow to the heart of command economies (although the actual failure of command economies rather does that), it does not say anything in particular about “reducing government to nearly nothing” or what level of regulation to enable the market is best. ---
**Author:** ![Der\_Trihs](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/der_trihs/32/233_2.png) [@Der\_Trihs](https://boards.straightdope.com/u/Der_Trihs)\ **Post date:** [November 12, 2008, 1:02am UTC](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252/22 "2008-11-12T01:02:58Z")
> [@robertliguori](#): > > So, what to do about this? Have the science of economics involve less math and more sociology, I say. If all economists analyzed transactions with the assumption that all participants would try to find a way to go off-model, I think we’d get better models. I agree. I’ve noticed that these right wing models of economics seem to assume that everyone involved is mindless, like so many competing genes; or is ideologically committed to the free market to the point of self sacrifice; or too short sighted to, as in your example, try to manipulate & subvert the system for their own profit. ---
**Author:** ![wmfellows](https://avatars.discourse-cdn.com/v4/letter/w/c2a13f/32.png) [@wmfellows](https://boards.straightdope.com/u/wmfellows)\ **Post date:** [November 12, 2008, 1:04am UTC](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252/23 "2008-11-12T01:04:51Z")
> [@Der\_Trihs](#): > > Because they have data you don’t, and can’t get. And because they care about the big picture even if you don’t. Worked spectacularly well in the old Sov Bloc, this … entertaining supposition. And Robert: there is an entire field called Behavioural Economics that has, oh more than 15 years of research ongoing to address some of the Classic rationality assumptions weak points (such as asymmetrical values assigned to loss versus gain). I agree with Smith, these threads tend to become depressingly poorly informed ideological shouting matches. It would at least be useful for people to pay attention to different meaning attached to rational as “term of art” and rational in ordinary usage. ---
**Author:** ![wmfellows](https://avatars.discourse-cdn.com/v4/letter/w/c2a13f/32.png) [@wmfellows](https://boards.straightdope.com/u/wmfellows)\ **Post date:** [November 12, 2008, 1:06am UTC](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252/24 "2008-11-12T01:06:52Z")
> [@Der\_Trihs](#): > > I agree. I’ve noticed that these right wing models of economics seem to assume that everyone involved is mindless, like so many competing genes; or is ideologically committed to the free market to the point of self sacrifice; or too short sighted to, as in your example, try to manipulate & subvert the system for their own profit. Spoken like a true believer. Not that this tells us very much about _actual real economic modelling or theory_ at all, versus the Cartoon version that the Hard Left likes to paint. ---
**Author:** ![Der\_Trihs](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/der_trihs/32/233_2.png) [@Der\_Trihs](https://boards.straightdope.com/u/Der_Trihs)\ **Post date:** [November 12, 2008, 1:07am UTC](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252/25 "2008-11-12T01:07:09Z")
> [@wmfellows](#): > > Mate, you either don’t understand a proper economist’s use of the term rationale or don’t wish to use it. Never mind you rather grossly mischaracterise Freidman. The idea of rationality in economics most certainly is not mainly about reduction of government. The concept focuses on the reasonable (if not perfect, certainly) supposition that most of the time people have coherent hierarchies of preferences, and typically speaking free exchange between rational actors [as defined] is an efficient mechanism for balancing offer with demand. While it certainly strikes a blow to the heart of command economies (although the actual failure of command economies rather does that), it does not say anything in particular about “reducing government to nearly nothing” or what level of regulation to enable the market is best. But Friedman was well known for wanting to do just that; to eliminate government regulations, aid programs, regulations in general, and so on. And that’s been the general thrust of economic theories like his; which is, as I say, why they don’t reflect reality. ---
**Author:** ![Little\_Nemo](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/little_nemo/32/3120_2.png) [@Little\_Nemo](https://boards.straightdope.com/u/Little_Nemo)\ **Post date:** [November 12, 2008, 1:10am UTC](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252/26 "2008-11-12T01:10:56Z")
I recently read an article about Alan Greenspan that said his big mistake was to place too much faith in the rationality of the market because he believed banks and other financial institutions would do the rational thing to protect themselves from a financial collapse. But what he didn’t think about was that banks don’t make decisons - people employed by banks make the decisons. And these people would often put their own personal interests ahead of any interest of the bank. They would readily take a risk that would produce a big payout during their career with no concern about the possibility of a collapse in the future. ---
**Author:** ![Der\_Trihs](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/der_trihs/32/233_2.png) [@Der\_Trihs](https://boards.straightdope.com/u/Der_Trihs)\ **Post date:** [November 12, 2008, 1:11am UTC](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252/27 "2008-11-12T01:11:14Z")
> [@wmfellows](#): > > Worked spectacularly well in the old Sov Bloc, this … entertaining supposition. Ah, yes; the standard right wing attempt to portray any desire for government regulation as Communism. > [@wmfellows](#): > > And Robert: there is an entire field called Behavioural Economics that has, oh more than 15 years of research ongoing to address some of the Classic rationality assumptions weak points (such as asymmetrical values assigned to loss versus gain). Which isn’t the kind of economic theory we are talking about here. > [@wmfellows](#): > > Spoken like a true believer. Not that this tells us very much about _actual real economic modelling or theory_ at all, versus the Cartoon version that the Hard Left likes to paint. It’s the cartoon version that tends to drive policy on the right, so that’s what matters. ---
**Author:** ![BrightNShiny](https://avatars.discourse-cdn.com/v4/letter/b/7bcc69/32.png) [@BrightNShiny](https://boards.straightdope.com/u/BrightNShiny)\ **Post date:** [November 12, 2008, 1:13am UTC](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252/28 "2008-11-12T01:13:25Z")
> [@msmith537](#): > > The problem is that there are really several different entities interacting in such a way as to not adequately communicate information between different markets. > > Mortgage lenders not adequately screening borrowers. Rating agencies not properly quantifying risks associated with CDOs consisting of securitized mortgages. Bankers interested in short term profits. You have several different markets interacting without the right information being properly passed between them. Ok, but this is an information problem that requires some sort of fix, and the problem in the US is that anytime some one proposes government regulations to rectify information problems, people start screaming about communism. ---
**Author:** ![RickJay](https://avatars.discourse-cdn.com/v4/letter/r/bb73d2/32.png) [@RickJay](https://boards.straightdope.com/u/RickJay)\ **Post date:** [November 12, 2008, 1:18am UTC](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252/29 "2008-11-12T01:18:56Z")
> [@Captain\_Amazing](#): > > No…that’s an irrational action. A rational capitalist tries to maximize his profit. If he’s limiting his profit, he’s acting irrationally. You’re confusing profit with utility. Taking your statement to its logical conclusion, all people should attempt to work every waking hour of their lives, since that would maximize their profits as sellers of labour. They don’t, because that would provide them with less utility than a chosen mix of work and leisure. A capitalist will not necessarily maximize profit if other means of getting utility compete with profit on one or more indifference curves. This could become an interesting discussion but, regrettably, the thread looks like it’s headed in the wrong direction. ---
**Author:** ![wmfellows](https://avatars.discourse-cdn.com/v4/letter/w/c2a13f/32.png) [@wmfellows](https://boards.straightdope.com/u/wmfellows)\ **Post date:** [November 12, 2008, 1:21am UTC](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252/30 "2008-11-12T01:21:13Z")
> [@Der\_Trihs](#): > > But Friedman was well known for wanting to do just that; to eliminate government regulations, aid programs, regulations in general, and so on. And that’s been the general thrust of economic theories like his; which is, as I say, why they don’t reflect reality. He believed in vastly reducing government intervention in the economy. Right or wrong - I would not agree with the extent he thought valid, your description of modern economic theory is cartoonishly distorted by your ideology (and you evidently do not have a strong grasp on the actual theory). And > [@](#): > > Ah, yes; the standard right wing attempt to portray any desire for government regulation as Communism. No, not at all. I have nothing against well designed regulation, and indeed the occasional strategic intervention in the markets when things get bollixed up - bloody nationalise the banks if necessary for a bit in a crisis. The supposition, however, you trotted out of the best informed bureaucrat and the Greater Good rot is pure old Sov style thinking. And btw, most of the Behavioural Economics lit builds on the Classic - it is indeed this kind of economics. ---
**Author:** ![sailor](https://avatars.discourse-cdn.com/v4/letter/s/a587f6/32.png) [@sailor](https://boards.straightdope.com/u/sailor)\ **Post date:** [November 12, 2008, 1:46am UTC](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252/31 "2008-11-12T01:46:55Z")
> [@Der\_Trihs](#): > > Because, say, they have in hand a study showing that the medicine you want is poison. Thus the FDA. Or that the building you want to move into is in danger of collapse. Thus building codes. Or that regardless of your opinion and/or resources, your child should at least be literate. Thus public schools. Or that regardless of how much more it costs to dispose of safely, it’s bad for everyone if you dump cyanide in your local river. Thus the EPA. Or that the business you want to buy from is a scam, or is collaborating with others to fix prices; thus business regulations. And so on. > > Because they have data you don’t, and can’t get. And because they care about the big picture even if you don’t. > > False dilemma. there’s a whole lot of grey area between unregulated markets and Communism. > > Quite often you don’t even know that what you want is a bad idea - just because you, for example demand a medicine to make you better, doesn’t mean that the medicine actually works. And quite often what you ask for isn’t what you’ll get anyway, without the government keeping the predators under control. Again, you are confusing freedom of the market with regulation of the market. And, since you keep doing it in spite of my and others’ clarifications I have to assume you are doing it deliberately. Nobody is against a healthy regulation of the markets and your attempts to imply otherwise is a straw man. To anyone genuinely interested in the topic of free markets and how prices communicate information I recommend Hayek’s “The Road to Serfdom” and his article which I linked to in other threads. (I get tired of having to search for the links so often). ---
**Author:** ![BrightNShiny](https://avatars.discourse-cdn.com/v4/letter/b/7bcc69/32.png) [@BrightNShiny](https://boards.straightdope.com/u/BrightNShiny)\ **Post date:** [November 12, 2008, 2:14am UTC](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252/32 "2008-11-12T02:14:39Z")
> [@sailor](#): > > Again, you are confusing freedom of the market with regulation of the market. And, since you keep doing it in spite of my and others’ clarifications I have to assume you are doing it deliberately. Nobody is against a healthy regulation of the markets and your attempts to imply otherwise is a straw man. I don’t have a cite, but I’ve read several places that Milton Friedman advocated abolishing the FDA, which sounds to me like a complete obliteration of regulation rather than a healthy regulation of markets. I’ve never read the article in which Friedman supposedly advocated this, so perhaps he had something else in mind. Maybe someone here knows how Friedman intended to solve all the efficiency problems associated with the things the FDA regulates. But unless someone can present that argument here, then characterizing Friedman as a deregulator seems fair to me. ---
**Author:** ![IdahoMauleMan](https://avatars.discourse-cdn.com/v4/letter/i/71c47a/32.png) [@IdahoMauleMan](https://boards.straightdope.com/u/IdahoMauleMan)\ **Post date:** [November 12, 2008, 2:20am UTC](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252/33 "2008-11-12T02:20:25Z")
> [@BrightNShiny](#): > > I don’t have a cite, but I’ve read several places that Milton Friedman advocated abolishing the FDA, which sounds to me like a complete obliteration of regulation rather than a healthy regulation of markets. > > I’ve never read the article in which Friedman supposedly advocated this, so perhaps he had something else in mind. Maybe someone here knows how Friedman intended to solve all the efficiency problems associated with the things the FDA regulates. But unless someone can present that argument here, then characterizing Friedman as a deregulator seems fair to me. I believe Friedman advocated making the FDA voluntary, much like any other private entity. If you only want to buy drugs and food with an ‘FDA’ stamp on them, fine. Feel free to do so. The fees to support the FDA will be paid for by companies wishing to have the ‘FDA’ stamp on them. If someone is willing to buy drugs and food without the FDA stamp, that’s fine too. The companies that sell those will have a lower cost structure. There can also be other agencies that spring up to compete with the FDA. Perhaps they would even be better at diagnosing risk and could do it more cheaply than a government agency. Food and drug companies wishing to utilize a different stamp of approval would pay the new agencies fees to come and inspect their products. You could also apply the same logic to the Consumer Products Safety Commission. The way it works today, the FDA has an absolute monopoly on the rules. There is no possibility for competitive agencies, because the food and drug companies must clear the FDA’s bar, and no one else’s. Even if the bar is too high, or costs too much, or is too restrictive. They don’t have a choice, and neither do you. ---
**Author:** ![BrightNShiny](https://avatars.discourse-cdn.com/v4/letter/b/7bcc69/32.png) [@BrightNShiny](https://boards.straightdope.com/u/BrightNShiny)\ **Post date:** [November 12, 2008, 2:28am UTC](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252/34 "2008-11-12T02:28:55Z")
> [@IdahoMauleMan](#): > > I believe Friedman advocated making the FDA voluntary, much like any other private entity. > > If you only want to buy drugs and food with an ‘FDA’ stamp on them, fine. Feel free to do so. The fees to support the FDA will be paid for by companies wishing to have the ‘FDA’ stamp on them. > > If someone is willing to buy drugs and food without the FDA stamp, that’s fine too. The companies that sell those will have a lower cost structure. > > There can also be other agencies that spring up to compete with the FDA. Perhaps they would even be better at diagnosing risk and could do it more cheaply than a government agency. Food and drug companies wishing to utilize a different stamp of approval would pay the new agencies fees to come and inspect their products. > > You could also apply the same logic to the Consumer Products Safety Commission. > > The way it works today, the FDA has an absolute monopoly on the rules. There is no possibility for competitive agencies, because the food and drug companies must clear the FDA’s bar, and no one else’s. Even if the bar is too high, or costs too much, or is too restrictive. They don’t have a choice, and neither do you. I don’t want to hijack this thread into a debate about the FDA. However, nothing you’ve posted here rectifies the efficiency problems (particularly the information assymetry or negative externality problems) associated with medication or food. This isn’t smart regulation, this is no regulation. And again, my recollection is that he wanted to get rid of it, not make it voluntary. ---
**Author:** ![IdahoMauleMan](https://avatars.discourse-cdn.com/v4/letter/i/71c47a/32.png) [@IdahoMauleMan](https://boards.straightdope.com/u/IdahoMauleMan)\ **Post date:** [November 12, 2008, 2:44am UTC](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252/35 "2008-11-12T02:44:34Z")
> [@BrightNShiny](#): > > I don’t want to hijack this thread into a debate about the FDA. However, nothing you’ve posted here rectifies the efficiency problems (particularly the information assymetry or negative externality problems) associated with medication or food. This isn’t smart regulation, this is no regulation. > > And again, my recollection is that he wanted to get rid of it, not make it voluntary. Yes, I complicated the question. Sorry about that. Getting rid of it and making it voluntary are essentially the same thing. If nobody wants to avail themselves of the FDA’s services, it will go out of business like any other business. There is information asymmetry everywhere in consumer decision-making. When you buy a house. When you buy a used car. When you flick on a TV program. When you order a hamburger at a restaurant. There are many choices a consumer can make before the decision, during the decision and even after the decision to mitigate the effects of information asymmetry. There are opinions he can solicit, substitutes he can consider, agents he can employ on his behalf, lots of things. The presence of a government agency that ‘blesses’ the sale of a product gives people a false sense of security that the asymmetry problems you describe have been solved when in fact they have not. And the cure is worse than the disease. If a consumer wishes to avail themselves of the FDA (or any other competing agency) to ‘solve’ the asymmetry problem on their behalf, they are free to do so in Friedman’s world. ---
**Author:** ![BrightNShiny](https://avatars.discourse-cdn.com/v4/letter/b/7bcc69/32.png) [@BrightNShiny](https://boards.straightdope.com/u/BrightNShiny)\ **Post date:** [November 12, 2008, 2:58am UTC](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252/36 "2008-11-12T02:58:37Z")
> [@IdahoMauleMan](#): > > There is information asymmetry everywhere in consumer decision-making. When you buy a house. When you buy a used car. When you flick on a TV program. When you order a hamburger at a restaurant. There are many choices a consumer can make before the decision, during the decision and even after the decision to mitigate the effects of information asymmetry. There are opinions he can solicit, substitutes he can consider, agents he can employ on his behalf, lots of things. > > The presence of a government agency that ‘blesses’ the sale of a product gives people a false sense of security that the asymmetry problems you describe have been solved when in fact they have not. And the cure is worse than the disease. > > If a consumer wishes to avail themselves of the FDA (or any other competing agency) to ‘solve’ the asymmetry problem on their behalf, they are free to do so in Friedman’s world. Is this Friedman’s argument? Because this argument presupposes that individuals are capable of limiting or eliminating information assymetry problems absent government regulation. And if that’s his argument, then I’m going to agree that he has taken deregulation to absurd places. It may be true in some cases, but I seriously doubt it’s going to be true in the case of highly complex things like medicine. And all you have to do is look at the current financial meltdown to see why I say that. That is a case of sophisticated people (except for borrowers, but they had agents–mortgage brokers) completely unable to rectify information assymetry problems in any coherent fashion. But perhaps Friedman didn’t care about economic efficiency? ---
**Author:** ![erislover](https://avatars.discourse-cdn.com/v4/letter/e/71e660/32.png) [@erislover](https://boards.straightdope.com/u/erislover)\ **Post date:** [November 12, 2008, 4:00am UTC](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252/37 "2008-11-12T04:00:40Z")
I think the answer is: because they generally are, to the extent they can be. What we can disagree about is what it takes to make markets work, and what are the limits of human rationality (like long-term risk assessment). Some seem to set that bar surprisingly low for the former issue. As for the latter, for the short and I think even the medium term, people are pretty damn rational. There are weird quirks like the Allais paradox and the so-called winner’s curse (maybe we just lump it all in “loss aversion”) but that is more of a “theory approximates reality” than “theory is worthless and dumb” argument. People respond to incentives–this is the basis of the whole shebang. ---
**Author:** ![oliversarmy](https://avatars.discourse-cdn.com/v4/letter/o/eb8c5e/32.png) [@oliversarmy](https://boards.straightdope.com/u/oliversarmy)\ **Post date:** [November 12, 2008, 4:45am UTC](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252/38 "2008-11-12T04:45:30Z")
Markets are markets. Economists and other intellectuals try to to tell us what they will do. However, they don’t always follow the experts or common wisdom. Markets usually follow the money, despite what we expect or attempt to control. Governments and corporations can influence the markets, but they don’t control the markets, despite their best or worst intentions. The market always wins. ---
**Author:** ![RickJay](https://avatars.discourse-cdn.com/v4/letter/r/bb73d2/32.png) [@RickJay](https://boards.straightdope.com/u/RickJay)\ **Post date:** [November 12, 2008, 5:02am UTC](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252/39 "2008-11-12T05:02:41Z")
> [@BrightNShiny](#): > > Is this Friedman’s argument? Because this argument presupposes that individuals are capable of limiting or eliminating information assymetry problems absent government regulation. And if that’s his argument, then I’m going to agree that he has taken deregulation to absurd places. It may be true in some cases, but I seriously doubt it’s going to be true in the case of highly complex things like medicine. Curiously, though, you don’t think anything of it when buying an appliance, like a refrigerator or computer monitor, that could electrocute you or set your house on fire if it’s not built right. And yet the standards and inspection regimes for such things are voluntary, provided by private organizations like UL, CSA, and the like. I wouldn’t suggest for an instant there is no place for regulation, but this “everyone who opposes my view is a Nazi” attitude \*\*Der Trihs \*\*seems to adopt in every thread is getting tiresome. There is a perfectly good argument to be made for maintaining a free market and keeping regulation at least limited to where we know it works. ---
**Author:** ![BrightNShiny](https://avatars.discourse-cdn.com/v4/letter/b/7bcc69/32.png) [@BrightNShiny](https://boards.straightdope.com/u/BrightNShiny)\ **Post date:** [November 12, 2008, 5:33am UTC](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252/40 "2008-11-12T05:33:06Z")
> [@RickJay](#): > > Curiously, though, you don’t think anything of it when buying an appliance, like a refrigerator or computer monitor, that could electrocute you or set your house on fire if it’s not built right. And yet the standards and inspection regimes for such things are voluntary, provided by private organizations like UL, CSA, and the like. I see you are posting from Ontario. I don’t know what the laws in Canada are, but in the US, the Consumer Products Safety Commission (CPSC) regulates all consumer appliances. In a number of cases the CPSC sets minimum safety regulations explicitly, and in some cases, they require manufacturers to conform to UL specs (IIRC, automatic garage door openers are explicitly required to follow UL specs). The CPSC also has authority to issue recalls or outright ban products from the market. Where the CPSC has not chosen to explicitly set specifications, manufacturers are still required to conform to “voluntary” guidelines–here, voluntary is a legal term of art which basically means industry adopted guidelines. On top of this, many government agencies will not purchase appliances which do not meet industry guidelines, and UL compliance may be cited as evidence of non-negligence in civil court. There is a whole governmental regulatory regime which pushes manufacturers into adopting UL guidelines, and if these guidelines were shown to be unsafe, the CPSC is charged with stepping and and issuing its own guidelines if it wants to. This is typical of the American regulatory approach, which is to try to allow the private sector significant input into the development of regulatory regimes. But it’s not a good example of a lack of regulation. [Previous page](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252.md?page=1) [Next page](https://boards.straightdope.com/t/what-made-friedman-believe-real-life-markets-are-rational/472252.md?page=3)