People really take Adam Smith way too seriously. He lived at a time when the economy was made up of independent artisans not people working for large multinational corporations. If markets were really so good at regulating themselves why were any government standards necessary at all?

The reality is, every product has an asymmetry of information, and the more complex it is, the higher the asymmetry. And you can’t determine the quality of a product until you buy it. And determining quality takes time, which is a limited resource.

> the business will rightly fail

In reality, what stops bad behavior is regulation because in reality, people do not have infinite time and infinite information to assess each thing they consume.