Can a market function if everyone has the same preferences Assume everyone has the same preferences. Therefore there would be , for example, no trivial concept of liquidity preference differences etc.

Would the economy still work?
Even if everyone's preferences are exactly the same, as long as you leave diminishing marginal utility (e.g. each person would rather have nonzero proportions of apples and bananas rather than exclusively apples or exclusively bananas) and the advantage of division of labor (e.g. a farmer can produce more apples or more bananas if he focuses exclusively on growing one of those rather than trying to grow some of both), there will still be trade because people will want to maximize the value they accumulate by specializing their labor, but possess that value in the form of a wider variety of goods than their (efficiently allocated) labor produces.