"There is a belief, current in many countries, which has been elevated to the rank of an official article of faith in the United States, that free competition is itself a homeostatic process: that in a free market the individual selfishness of the bargainers, each seeking to sell as high and buy as low as possible, will result in the end in a stable dynamics of prices, and with redound to the greatest common good. This is associated with the very comforting view that the individual entrepreneur, in seeking to forward his own interest, is in some manner a public benefactor and has thus earned the great rewards with which society has showered him.

Unfortunately, the evidence, such as it is, is against this simple-minded theory. The market is a game, which has indeed received a simulacrum in the family game of Monopoly. It is thus strictly subject to the general theory of games, developed by von Neumann and Morgenstern. This theory is based on the assumption that each player, at every stage, in view of the information then available to him, plays in accordance with a completely intelligent policy, which will in the end assure him of the greatest possible expectation of reward. It is thus the market game as played between two perfectly intelligent, perfectly ruthless operators. Even in the case of two players, the theory is complicated, although it often leads to the choice of a definite line of play. In many cases, however, where there are three players, and in the overwhelming majority of cases, when the number of players is large, the result is one of extreme indeterminacy and instability. The individual players are compelled by their own cupidity to form coalitions; but these coalitions do not generally establish themselves in any single, determinate way, and usually terminate in a welter of betrayal, turncoatism, and deception, which is only too true a picture of the higher business life, or the closely related lives of politics, diplomacy, and war.

In the long run, even the most brilliant and unprincipled huckster must expect ruin; but let the hucksters become tired of this and agree to live in peace with one another, and the great rewards are reserved for the one who watches for an opportune time to break his agreement and betray his companions. There is no homeostasis whatever. We are involved in the business cycles of boom and failure, in the successions of dictatorship and revolution, in the wars which everyone loses, which are so real a feature of modern times. "

- Norbert Weiner

Cybernetics, or control and communication
in the animal and the machine

The M.I.T. Press and John Wiley and Sons, Inc.
1961