It's been like that since 1952 regardless of the different countries various and changing affiliations and memberships, and long before any single market.
The point is that it is neither unheard of nor hard to keep an open border. All you need is a will to do so.
Today's world is not the same. And you're talking about countries with a similar culture, not trying to compete with each other.
The UK wants to leave the EU as it feels special, and wants to become some kind of Ayn Randian utopia where anything goes.