Evidence-based free-market economics?

Seeing as I am an outcomes researcher, I thought I'd float this question to all the zealots of free market economic theories: Have their outcomes ever been examined in an evidence-based manner? Here is what I mean.

In medicine, the highest quality evidence comes from randomized controlled trials (RCT). In these deliberately and painstakingly planned and executed studies subjects are enrolled randomly into either a treatment group or a placebo (or standard of care) group, and certain relevant outcomes over time are compared between the two groups. This design works well for drug trials, for example, but not so well for something like environmental exposure studies. Thus, in order to understand the adverse effects of smoking on health, no RCT could be performed ethically, so these data come to us from epidemiologic studies. Though deemed by the EBM community to be somewhat inferior to an RCT, they have their advantages: they can enroll more and varied patients, they are cheaper, they are more feasible to do over long periods of time, and they do not require alterations in naturalistic practice. The flip side is that we have to be more careful about introducing such inaccuracies as bias, misclassification and others, though their most important limitation as cited by some is their inability to prove cause and effect.

Putting the limitations of epidemiologic methods aside, their practicality makes them attractive and ubiquitous in helping us understand healthcare. One of the most important issues we face in EBM is understanding the risk-benefit profile of what we do. To get at this, our studies have to be planned carefully to incorporate not only the important exposures, but also the relevant, valid and complete endpoints (or outcomes). Thus, it is not enough to pat ourselves on the back by saying that a drug decreases the risk of a clot; we also have to show that this benefit outweighs the attendant risk of bleeding in the specific population of patients.

Let's apply these principles to the free-market theory. Have its advocates examined its risk-benefit profile in a scientifically rigorous manner? According to Harvard's Stephen Marglin, they have not. In his book "The Dismal Science" he makes a strong argument that economists, by pushing their free market theories with religious fervor, have undermined the very structures of our communities. Furthermore, this noted professor of Economics maintains that free market theories have never been impartially evaluated. So, there you have it: the single unifying thread of the entire Western civilization today is just as faith-based as a rain dance around a fire. So, when we talk about evidence for climate change and peak oil and how a concerted effort to mitigate these phenomena would affect our economy, let's not fool ourselves: the evidentiary standards we demand for free market's detrimental effects are much more stringent than those for its benefits, which we have essentially swallowed on faith. Hook, line and sinker.