The Invisible Hand Meets the Unconscious Brain: The Pitfalls of Free Markets

By: Peter A. Ubel

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Synopsis: Free markets have created tremendous wealth--of opportunity and of consumer goods. Free markets have encouraged the expansion of human liberties, giving people more choice in the workplace and in the shopping market. In theory, these liberties and choices should work out for the best. People will make choices based on their preferences and values. But with all the wonders of the free markets, comes the freedom for people to make bad decisions. Take the sixty-year old diabetic man who buys a pound of beef, a six-pack of beer, and a dozen donuts, or the twenty-year old who purchases a carton of cigarettes. Clearly, these people are not acting in their own best interest. According to physician and behavioral scientist Peter Ubel, it isn't hard to see evidence all around that many of the purchasing decisions we make are having less than ideal effects on our well-being, and on society at large. This chapter is excerpted from "Free Market Madness: Why Human Nature Is at Odds with Economics--and Why It Matters."