It's a homophonic error, where a word is mistakenly replaced with another that sounds similar but has a different meaning.
People make this error because "reign" and "rein" are homophones—words that sound the same but have different meanings and spellings. The phrase "free rein" involves imagery of loosening a horse's reins to allow it freedom of movement, but "reign" suggests control or rule, leading to confusion.
The correct phrase is "free rein," which refers to giving someone freedom to make decisions or act as they see fit, similar to how a rider gives a horse free rein.
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