[pdonis]

> Isn't the rise of index funds an example of rational choices in a free market leading to suboptimal outcomes?

To the extent that it creates problems with time horizon and corporate governance, yes.

However, that does not mean that making the market less free will improve outcomes.

> How would a freer market fix the time frames issue

Who said anything about a "freer market"? You just said (and I agreed) that the rise of index funds is an example of rational choices in a free market. So there is no "freer" market that can fix it.

What I said was that government interference does not fix anything; it makes things worse. (US tax laws being an example.)