Some economists, such as Hayek, argue that in the real world most markets will be in a constant state of flux - always adjusting towards equilibrium but rarely actually reaching it. In this analysis, it is the market's ability to act as an information system that is important rather than its ability to produce a single equilibrium price.

Take our market for cosmetic dental services. If the market were free and competitive, then different dentists would offer different mixes of service, and some dentists would be more skilful than others. The skilful dentists offering the services consumers want would have lots of customers and would be able to charge higher prices than their competitors. This would force the other dentists to modify the services they are selling to try to capture back the consumers. This process of competition would be continuous, particularly as other factors influencing demand and supply, such as levels of income or the state of technology, are likely to be changing as well.

This kind of analysis has led some economists to argue that health care should be provided by the market not by the state. We look at this in the next section 'Health care - case for a free market'.

Now look at these (check the status bar for information)