Liberty is freedom from being constricted, in any way, shape or form. Period.

Liberty is more of an adjective rather than a verb. A situation more than an action.

Liberty can be attached to a space, to an agent or to both.

A free space would be a space where no constriction may occur, whatsoever.
A free agent would be an individual entity outside any constriction, whatsoever.

Mathematically, both definitions are possible.
Philosophically, both definitions are imaginable. By philosophers, of course.

Oscar Hoffman, a Teacher, kept telling us, his students, “For a proposition to be true it is not enough for it to be logically correct. It also has to make ontological sense. For those of you who don’t remember what ontological means, a true proposition must describe something which has to be at least possible”

In the real world, where there is no such thing as absolute freedom, liberty has to be first noticed/invented. And then constantly negotiated.

‘No such thing as absolute freedom?!? But liberty is a (God given) (human) right!!!’

Do you remember what Hoffman had (just) said about things which can exist in practice and things which can exist only in our minds?
Liberty might be a right – for those who enjoy it, but that doesn’t mean that everybody has it. And, even more important, that there is – or ever will be, something even close to absolute liberty.
If you don’t believe me, try to fly off a balcony without any ‘mechanical’ help. Or stop eating for a day or two. The Earth will surely ‘constrict’ you back towards its center and your stomach will certainly constrict itself for lack of food. And both Earth and stomach will constrict you back to reality.

‘OK, so no absolute freedom for individuals. How about ‘free spaces’?’
‘As in spaces where no constriction, whatsoever, may be exercised?’
‘Yes.’
‘Well, that would be possible. If a space is completely empty… no constriction might be exercised in there, right? On the other hand, as soon as something, anything, populates that space, constrictions start to appear. For instance, since no two things can simultaneously exist in the very same place, the mere existence of a speck of dust in a whole stadium induces the restriction that no other speck of dust may exist in the very same spot. Sounds trivial, true, but this is it… No absolute freedom. Not for individual agents and nor for spaces.’

‘Then why are writing a post about ‘Free market’? Doesn’t make much sense, isn’t it?’

Let me finish with liberty before going any further.
I mentioned earlier that liberty must be first noticed and then negotiated.
You see, right or no right, liberty is, above all, a concept.
We’d first observed that a flying bird is freer that a crawling worm and bam!!! We realized that some of us were freer than the others. Then that freer groups/societies fared better than the more ‘stifled’ ones.
But only where liberty was more or less spread around, not concentrated in one hand. Dictatorships – where all liberty is concentrated at the top, are way more fragile than any democracy. I’ll come back to this.
Now, for the negotiation part.
‘Your freedom to swing your fist ends where my nose begins’. And vice-versa. Only this is rather incomplete.
Let me examine the situation where you are a person who likes to swing your fist. In the air, not with any aggressive intent, of course. So you were swinging your fist, after you had determined, in good faith, that there was no nose close enough to hurt. But what if I am a ‘nosy’ guy? ‘Nosy’ enough to bring my actual nose inside your reach? You having to restrict your swings – or to go somewhere else, isn’t a limitation of your freedom? An absolutely unnatural limitation of your freedom?
Has it become a little clearer? What I mean by negotiation when it comes to individual freedom?

OK, time has come for me to go to market. To the free market!

A market is a place. Obviously, right?
A place where people trade their wares. Because they have noticed that it is easier for each of them to do what each of them do better and then trade the results of their work instead of each of them providing everything for themselves. As in everything each of them needs. Or fancy.

Initially, markets were far from being free. First of all, supply was sorely limited. Transportation means were practically nonexistent so supply varied seasonally and was severely influenced by weather, soil and other similar factors. And, maybe even more importantly, supply was influenced by the sheer will of the most powerful ‘free agent’ who happened to be around. Or, more exactly, supply was heavily influenced by the whims of the most powerful free-agent who happened to be around.
Don’t believe me? Then consider the extreme famine experienced by the Bengalis in 1943. Or by the Romanians during the last years of Ceausescu’s reign.
Slowly, people have learned that freer markets tend to be a lot more stable than the less free. ‘Freer’ markets meaning freer from both exterior and interior limitations. For a market to become free(ish) the participants need to have a big enough pool of resources at their disposal and to be wise enough to organize themselves in a ‘free’ manner.

And what happens when at least one of the two conditions remains unfulfilled?
Time has taught us that while markets tend to be limited in space and that some of the participants tent to impose themselves over the rest there is one dimension where the liberty of the market is very hard to be limited. ‘Liberty’ here meaning that things tend to evolve more in their own terms rather than ‘according to plan’. Or according to anybody’s wishes.

Whenever the available resources dry up, the participants to the market move someplace else. Or die of starvation.
Whenever a market looses too much of its freedom – as in some agent controls too much of what is going on there, the market itself no longer functions properly. Whenever too many of the participants loose their ability to determine their fate/future they slowly become ‘sitting ducks’. Not as much easy to hunt down but actually unable to feed themselves.
And since hunger is the best teacher, they either learn to fight for their freedom or… die of starvation. Pol Pot’s Cambodia would be a good example, even if somewhat extreme. The fall of most communist regimes also makes a compelling case for what I have in mind.
Even more interesting, though, is what had happened to the American Automobile Industry. General Motors and Chrysler Corporation, once the dominant stars of the market – along with Ford, had to be rescued by the government. Quasi monopolistic positions tend to be bad for the monopolists also, not only for the rest of the market. Given enough time, true enough…