If a company is inefficient or fails to innovate, competition will spring up and grab its market share. If a company does not treat its workers well, they will leave for better jobs elsewhere. If a company puts out products which are defective, dangerous, or harmful to the environment, the public will refuse to buy them.
Work is done, progress is achieved, and all is right with the world.
This myth relies on the assumption of informed, rational individuals freely entering into agreements. This is not a valid assumption. We cannot be completely informed about all of our decisions. There are simply too many decisions to make. The situation becomes more serious when one party deliberately conceals relevant information.