What is in business, what is free?
Free Enterprise, a concept that forms the basis for free market economies, dictates lack of regulation and other government interference with the economic machinations of society. The Free Enterprise is considering interacting the laws of supply and laws of demand and how they will lead to the “competitive market” with effective price conditions and maximizing productivity if market participants are left on their own facilities. This is a concept perfectly expressed by Adam Smith in his book from 1776 called wealth of nations . There are competitive ideologies with a free enterprise prescription that claims that government regulation is necessary to prevent the abuse of freedom on the market.
The basis of a free enterprise are market participants - sellers and buyers. The laws on supply and demand dictate that if they are without intervention, the free market participants will act to support their individual interests, purchase and selling goods and services until they eventually achieve economic balance. Economic balance is a definitionVana as a point at which the price of goods or services is set at a point where the supply of goods or services will satisfy the demand on the market. Without inequalities of supply or demand, the market will achieve its balance and will work at its greatest level of efficiency.
In 1776, Adam Smith wrote a book entitled The Wealth of Nations , for which the Free enterprise was one of the central topics - although the term art has not yet been invented. Smith writes in detail about the "invisible hands of the market", a mechanism that automatically regulates the free market to facilitate maximum efficiency through market participants trying to meet their own interests. Simply through human predisposition, looking for the best and most effective way, the invisible hand will lead to mutually beneficial cooperation on the market.
The other side of this argument is that the market regulation is necessary to prevent freedom of abusemarket and many side effects. For example, the government adopts working laws to prevent abuse of workers at a lower level of business owners who have a lot of power on the market. Furthermore, there are side effects that are often not taken into account on the free market, such as pollution that needs to be regulated and may result in a prohibition of the most effective way of doing business. Any external intervention, whether laws, regulations or subsidies, goes against the principles of a free enterprise. The need for such an intervention is where most economic debates lie.