Perfect competition is definitely taught as a concept, mostly as a benchmark to measure real-world markets against, but I don’t think it’s literally an assumption of everything you learn in Econ 101.

Most of the theoretical results of basic economics (i.e. Econ 101) are built on really sketchy assumptions, including perfect competition. I recommend Steve Keen, Debunking Economics, for one amusing reference.

A lot of people seem to think that free markets require perfect information and perfect competition.

These requirements are not remotely necessary for free markets to work and work well.

What are the requirements for a free market to work well? And how do you define working well?

> requirements for a free market to work well

Most generally, transactions can be freely negotiated by either party. I.e. no force or fraud. Contracts need to be enforceable. Individual liberties must be guaranteed.

> working well

Delivering on prosperity.

To clarify, imperfect information is not fraud.

Force in this context is something proactively applied, such as your signature will be on the contract or your brains. Force is not withholding something you have that the other party needs.

Charity, voluntarily helping others in need, etc., is perfectly in line with free market principles. Unions are perfectly in line, too, although laws bestowing monopoly powers on unions are not.

A free market does not have to be a perfect free market in order to deliver prosperity. Even small amounts of free markets can have outsized positive benefits, as the Soviet Union discovered when it allowed farmers to farm small plots, sell the produce, and pocket the proceeds.

What does "delivering on prosperity" mean? Is that GDP per capita? Life expectancy? Number of iOS apps produced?

A rough measure is GDP growth per capita.

Life expectancy was a good proxy in the 1800s because it improved dramatically, but now it has asymptotically approached a biological limit so is less useful. The same for average height.

As evident from their replies elsewhere in the thread, working well means that they personally are well-compensated.

Assuming a perfectly spherical cow...

That's kinda the point. We define what a spherical cow is to be able to compare the real world against it. The problem for economists is that lay persons take that spherical cow to be truth and base whole ideological systems on those spherical cow.

Economists take the spherical cow as, if not the current state of cow-dom, the perfected nature of cows and what cows would be if they got to make the rules.

> Economists take the spherical cow as, if not the current state of cow-dom, the perfected nature of cows and what cows would be if they got to make the rules.

Well, sure in a way, but that includes the parts that lay people ignore like the perfect information element and perfect value optimizing decisionmaking of the rational actor model, and the absence of externalities. But most economists recognize that people aren't omniscient, don't always optimally apply the information they so have, and that you can't avoid econonicndecisions having impacts on people other than those voluntarily participating in them.

Far fewer economists (basically, just the Chicago/Austrian schools, the latter of which does so as pretty overtly an article of faith) think that if you can't magically handwave those elements of the model into reality, the rest of 101-level simplified regulation-free markets still remains desirable as an ideal.

I'm not really sure I understand what you are trying to say here.

The almost purely "logical" and "ideological" statements of 19th and early-to-mid 20th century economics have been supplanted with with more empirical methods.

You know the supply and demand curves, from Econ 101? How they meet at one point to determine the price of the thing? The demand curve can actually have any shape, so you can have any number of points where the two curves meet, and the supply curve has the problem that a firm making extra things both will and must not change the overall number of things made.

See Debunking Economics by Steve Keen.

This is a straw man argument. The issue at hand isn't "whether a free market is eminently desirable", but whether or not the relative ability for employers (or any buyer) to wait for a better price on a good or service renders a market unfree. My position is that a market in which one party (the employer in this specific case) can wait for another party (the worker) to come down to market price is entirely congruent with the definition of a free market.

Not really sure where there's a straw man here. I've addressed your concern on whether power dynamics are orthogonal or not. I've described the academic definition of what a perfectly competitive market is and referred to Coase's Theorem which essentially concludes such markets rarely exist in reality.

You say they are orthogonal, and I provided evidence that they are not.

It's a straw man in that no one in this thread is arguing that a free market is eminently desirable or otherwise making ideological arguments (contrary to the implication in your post). There's the chance that you weren't talking about "arguments made in this thread" and were simply digressing to "arguments made by other people elsewhere in the world" which is differently bad (off topic).

To be clear, I wasn't remarking about any comments you made about my orthogonality claim.

Yeah, I was talking to the immediate commenter, not the parent. I can understand where you're coming from with my off-topic comment; it was not intended to imply anything about anyone on the thread as such, nor was it a response to the op. It was just a lament of a frustrated person when it comes to their field of study.

Fair enough, and thanks for the clarification. I empathize with your frustration about bad arguments. :)

I think this is a difference without a distinction. I was using "leverage" in a non-standard way (I didn't realize it already had a formal economic definition). The parent cited the relative ability for some employers to wait for lower labor prices to be evidence of an unfree market--such a definition of 'free market' seems like it would preclude differences in wealth (and thus runway to await better market prices) between any two players in a market.