No, the calculation debate was NOT about whether neoclassical economic would
apply to a socialist economy. AT least that's not what the Austrians
thought. Hayek and Misesw ere onto the knowledge problem to start with. They
were also critics of NCE. The initial socialist response by Lange et al.
were neoclassical, but even Lange later realized that missed the point.
David Ramsey Steele, From Marx to Mises, offers an good historical overview
from an Austrian perspective.
--jks
>
>Justin writes:
>
> >"I like the book, but I _do_ buy the old Austrian take on the calculation
>problem, no "almost" about it. -jks"
>
>me:
>
>the socialist "calculation" debate was not about socialism versus
>capitalism,
>it was about whether or not neoclassical economics could apply to a
>"socialist"
>economy. of course it does not, neoclassical economics doesn't even apply
>to a
>market economy. so if that is what you mean by the Austrians winning, then
>fine.
>But the socialist calculation debate has been re-interpreted in more recent
>Austrian literature as about the "knowledge problem." See for example Don
>Lavoie's work. There are knowledge problems in all spheres of social life.
>Understanding requires interpretation. Goal-oriented activity has to deal
>with
>these issues. The Austrians like to think of market activity as analogous
>to
>scientific investigation, entrepreneurs are like scientists who are trying
>to
>"discover." Planners are somehow exempt from these creative powers.
>Scientists
>and entrpreneurs can take advantage of tacit knowledge, but planners
>cannot.
>Why? Why can't policymakers and planners also employ tacit knowledge,
>creative
>discovery? What is it that exempts policy makers and planners from
>overcoming
>knowledge problems just as scientists and entrepreneurs do? there is a
>dichotomous view of "market" and "state" here. will planners make mistakes
>sometimes? of course, just as entrepreneurs and scientists make mistakes.
>the
>Austrians were right in critiquing "rational" planning, but there are other
>types of planning: mixed-scanning, general systems, learning-adaptive,
>approaches provide insights, as does some "postmodern" planning.
>
>Lachmann called the "concept of 'plan'...a fundamental hermenutic notion"
>and
>stated that it "will have to be introduced into the theory of consumption"
>asking "If firms can make plans, why not households?" And why, we must ask,
>not
>other social groups, like neigborhoods, communities, cities, states,
>nations,
>and regions? as my professor of economic planning, Tom Vietorisz, wrote,
>planning, as an "exercise in social intent...shares the characteristics of
>all
>deliberate action...all deliberate human action aims in part at social
>effects."
>
>i hope to someday see a statue of Michael Polanyi right outside the
>Ministry of
>Planning.
>
>Mat
>
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