Markets are among the oldest and most powerful of social institutions. They are a dominant force in the world economy today and in many ways a force for change and progress. Market economies have led the race for industrialization, overcoming planned economies and traditional agricultural societies during the course of the twentieth century. The most attractive feature of markets is the efficiency with which they allocate resources, requiring minimal intervention once an appropriate legal infrastructure is in place. This was Adam Smith's vision of the “invisible hand” and was formalized in the neoclassical theory of competitive markets that has prevailed in the Anglo-Saxon world since the 1950s.
Since World War II international markets have been remarkably successful. In this period they achieved, to a great extent, a life of their own. World trade increased at least three times more than world production. Even the United States, traditionally an isolated economy, has more than doubled the proportion of trade to economic activity so that international trade today accounts for 30% of gross national product (GNP). The process of industrialization became an irresistible trend in the twentieth century, made global by the dynamics of international markets.
While propelling industrial society forward, markets have also led to excessive use of natural resources. Industrialization to date has been based on energy. It has been, and continues to be, based on the burning of fossil fuels and the attendant emission of carbon dioxide. Scientists now believe that carbon emissions can cause climate change. Economic activity is the fundamental driving