--- title: "Meaning & Key Takeaway of: \"Free markets\" is a very general term…" description: "\"\"Free markets\" is a very general term. There are all sorts of problems that will emerge. Free markets work best when the transaction between two indivi..." image: "https://sms4smile.com/quotes/i/32c/milton-friedman-616_between-you-and-me_free-markets-is-a-very-general-term-ther_498674.png" --- # "Free markets" is a very general term. There are all sorts… ![“"Free markets" is a very general term. There are all sorts of problems that will emerge. Free markets work best when the transaction between two individuals affects only those individuals. Most often, a transaction between you and me affects a third party. That is the source of all problems for…” quote by Milton Friedman](https://sms4smile.com/quotes/i/32c/milton-friedman-616_between-you-and-me_free-markets-is-a-very-general-term-ther_498674.png) [Download](https://sms4smile.com/quotes/i/32c/milton-friedman-616_between-you-and-me_free-markets-is-a-very-general-term-ther_498674.png) [Open image](https://sms4smile.com/quotes/i/32c/milton-friedman-616_between-you-and-me_free-markets-is-a-very-general-term-ther_498674.png) > “"Free markets" is a very general term. There are all sorts of problems that will emerge. Free markets work best when the transaction between two individuals affects only those individuals. Most often, a transaction between you and me affects a third party. That is the source of all problems for government. That is the source of all pollution problems, of the inequality problem. This reality ensures that the end of history will never come.” [Milton Friedman](https://sms4smile.com/quotes/author/milton-friedman/) ## About This Quote This interpretation was drafted with AI assistance. It is one reading of the quote, not the author's own explanation. Free markets are ideal when transactions affect only the parties involved; externalities cause problems that government must address, preventing a perfect end of history. **In simple terms:** Markets work best without side effects; government steps in when they arise. Key Takeaway Address externalities to improve market outcomes. Themes economics government externalities market failure history policy Mood analytical critical Type economic political When to use this quote - regulating pollution - tax policy - social welfare programs - international trade agreements Key Concepts liberalism public choice environmental economics Questions to Reflect On - How can we internalize external costs? - What role should government play in market regulation? A Different Perspective Government intervention can be inefficient or capture interest. ★ ★ ★ ★ ★ No ratings yet [Between you and me](https://sms4smile.com/quotes/about/between-you-and-me/) [Capitalism](https://sms4smile.com/quotes/about/capitalism/) [Ends](https://sms4smile.com/quotes/about/ends/) [Free market](https://sms4smile.com/quotes/about/free-market/) [Free markets](https://sms4smile.com/quotes/about/free-markets/) [Government](https://sms4smile.com/quotes/about/government/) [Individual](https://sms4smile.com/quotes/about/individual/) [Inequality](https://sms4smile.com/quotes/about/inequality/) [Investing](https://sms4smile.com/quotes/about/investing/) [Markets General](https://sms4smile.com/quotes/about/markets-general-4251193/) [Markets Work](https://sms4smile.com/quotes/about/markets-work-2396593/) [Party](https://sms4smile.com/quotes/about/party/) [Politics](https://sms4smile.com/quotes/about/politics/) [Pollution](https://sms4smile.com/quotes/about/pollution/) [Pollution Problems](https://sms4smile.com/quotes/about/pollution-problems-4251192/) [Problem](https://sms4smile.com/quotes/about/problem/) [Problems Government](https://sms4smile.com/quotes/about/problems-government-642380/) [Reality](https://sms4smile.com/quotes/about/reality/) [Source](https://sms4smile.com/quotes/about/source/) [Term](https://sms4smile.com/quotes/about/term/) [Third parties](https://sms4smile.com/quotes/about/third-parties/) [Third party](https://sms4smile.com/quotes/about/third-party/) [Thirds](https://sms4smile.com/quotes/about/thirds/) [Transactions](https://sms4smile.com/quotes/about/transactions/) [Two](https://sms4smile.com/quotes/about/two/) ## Related quotes > [If you let markets - in general, my belief is that if you let markets give you information, they'll give you the information rather…](https://sms4smile.com/quotes/nassim-nicholas-taleb/if-you-let-markets-in-general-my-belief-is-that-if-you-let-markets/) [Nassim Nicholas Taleb](https://sms4smile.com/quotes/author/nassim-nicholas-taleb/) > [I'm concerned that we don't address the water pollution problems in other countries. 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The only power it has is to take from some and give to others.](https://sms4smile.com/quotes/milton-friedman/the-government-doesn-t-have-any-money-the-only-power-it-has-is-to/) [Milton Friedman](https://sms4smile.com/quotes/author/milton-friedman/) > [What would the people who sold us goods do with the money? They'd get dollars. What would they do with the dollars? Eat them?!](https://sms4smile.com/quotes/milton-friedman/what-would-the-people-who-sold-us-goods-do-with-the-money-they-d-get/) [Milton Friedman](https://sms4smile.com/quotes/author/milton-friedman/) > [World trade depends on differences among countries, not similarities. Different countries are in different stages of development. It is appropriate for them to have…](https://sms4smile.com/quotes/milton-friedman/world-trade-depends-on-differences-among-countries-not-similarities/) [Milton Friedman](https://sms4smile.com/quotes/author/milton-friedman/) > [Is there some society you know of that doesn't run on greed? 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