That’s where the advanced comes in. The only really “unfettered laissez faire” that I know of in recent Western history was parts of the 9th-11th century “Holy Roman Empire”, where laissez faire applied to private military force and law (“privilege” derives from a Latin word meaning “private law”) as well as everything else. (Also, AFAIK there was little if any real capitalism, just mercantilism.)
By the end of the Wars of the Reformation (Peace of Westphalia) the nascent nation-states (heh) were already placing limits on private action, and both “free”-market capitalism and the Industrial Revolution evolved under those condition.
Competing nation-states created different paradigms for their industry (needed by the growth of gunpowder weapons), and England was most successful, followed by Prussia, although the latter’s place as part of a batch of competing principalities meant it never really outgrew its reliance on cartel capitalism. (For that matter, even England was only partial, the British East India Company comes to mind.)