Is not
market equilibrium essentially democracy?
Yes and no, and Market Equilibrium is not specifically Capitalism either.
On top of that, economic equilibrium, as noted in your above link's description does not exactly tie into this specific problem either. It focuses mostly on supply & demand, as well as balancing the price of a product.
In this case, the amount of demand and the amount of supply remains the same, as does the price for the most part. The only difference is the version of the game you want for the price you are paying, which is being worked around by getting the version you want from another country.
The amount of copies of this game being sold basically remains the same, Tripwire still gains profit and there is no pressure on the government to change their laws & restrictions, because there is nothing putting them at a disadvantage or having an ecomonic impact by using the above tactic, thus nothing really changes, their laws will probably remain in place as they are and Devs like Tripwire will still have to go through these hoops of editing their games to meet country's laws & regulations.
As far as democracy goes, most of us DO NOT live in a democracy. Since I'm from the United States and live in Texas, I live in what's called a Constitutional Republic. I highly doubt anyone of us would want to live in a Democracy since it's nothing more than mob rule.
I'm aware of the US's Republic system, but it still uses certain Democratic methods..... countries like the UK, Canada and Australia use what's called a "Parliamentary Democracy"
No one country is run completely as Democratic, Socialist, Communist, etc.... they use mostly one system over another, but balanced out with aspects from another system to make it work.
Countries like Canada, as an example, are what most would consider as a Socialist-Democracy, where certain services are run by the state (Medical care, etc.)
And while the US doesn't like the idea of Universal Health Coverage and think it's an evil Socialist system..... keep in mind that the US still uses Socialist systems to keep the country running as it is. You pay taxes for Firemen to put out fires, for police to protect your communities, the military that defends your nation, to things like standard road work on your highways.
Without those socialist traits, you'd have to pull out your wallet and pay firemen before they hooked up one hose, police would only protect those who pay them, and your soldiers would be mercenaries available to the highest bidder.
No one single country in the western world is pure Democratic, because there does need to be balance to cover "Mob Rule"...... but when looking at a country as a whole, they're more a Democracy than some other system, and that's what people mean by calling a nation a Democracy.
Capitalism certainly isn't perfect on its own either, just look at what happened in the recent global economic crisis.... when you leave the markets to regulate themselves and do as they please, crap like that can happen because a few bad apples will take advantage of the situation, just as a few bad apples would take advantage of mob rule democracy, just as they would take advantage of a completely communist or socialist government.
And that's why many nations are a blend of many of the above traits of each system...... simply because no one system is perfect.
If one of those systems were, than we'd all be using that one system and wouldn't have anything to complain about.
