Are “Free” Relevant Markets Actually Free?

Fernando Herrera-Gonzalez, Nov 11, 2015

The internet has changed our lives in several aspects; in fact, without fear of exaggeration, those changes can be described as revolutionary. One of the things we have started to get used to from the internet is the ubiquitous provision of free services. We can search information for free, we can receive and send messages for free, we can talk with distant relatives for free, we can play games and watch movies for free, and so on.

It is easy to get used to getting things for free. It is also easy to forget that this is something we humans have never enjoyed in our history. We are used to having to pay a price for everything we need, a dear price just to survive for most of our history. The preponderance of free services constitutes a good indicator of the revolution the internet presents in the minds of many people.

So, is there in the end “such a thing as a free lunch”? The economist Milton Friedman (awarded the Nobel Prize in 1976) famously titled one of his books There’s No Such Thing as a Free Lunch. Has the internet changed the way economic laws work or has this phrase just been refined to the current “If you’re not paying for something, it is because you’re the product”?

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