The issue of rules imposed by the state on organizations and people taking part in market transactions is not about regulation itself. What is not regulated by legislation can still be controlled in other ways. Consumer expectations, competition, prices of factors of production, customs and social norms - all these things influence (and regulate) what market agents will and will not do.
It is much more correct to think of markets as being “self-regulating” rather than “unregulated”. This way one can easily avoid a very popular notion of more regulation being equivalent to more involvement on the side of the government. This is why I tend to rephrase the question of “how much the market should be regulated by the state” to “should regulations be provided through political process or rather by market participants themselves”.
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What follows from the question of private vs. public provision of regulations is that when we try to determine whether a regulation is going to be advantageous or not we should not look at who is providing and enforcing it. Similar regulations can emerge in both, market and political environments. For example, with purely private road system, would having a car insurance be mandatory? It probably would although in forms differing from what we can see in most countries.