ABSTRACT
The uncontrolled operation of markets has both desirable and undesirable consequences. Amongst the desirable consequences are promptness of response to demand or supply changes, due to the response of producers and consumers to information on prices. The general tendency of an 'ideal-state' economy (with no economic friction resulting from imperfect knowledge, or excess power, on behalf of any of the participants in any markets) to promulgate technical and economic efficiency is a further advantage of the free-market system. A third major advantage is that the responsiveness of producers and consumers to prices (that is, the fact that they do respond, rather than the magnitude of the response) coupled with the tendency to economic efficiency, serves to allocate the limited resources (of capital, natural resources and manpower) available to satisfy to the greatest extent the largest number of wants within the economy, given the distribution of wealth.
