General Category > Economy/Business

The Economy Is Not a Factory—Nor Should We Try to Make It One

(1/1)

rangerrebew:
The Economy Is Not a Factory—Nor Should We Try to Make It One
 

A common issue with economists and political economists from left to right is that they misunderstand the market economy as simply being a set of production processes. We see this in Lenin’s statement that the Soviet Union should be run like one big factory. We see it in market socialists from Frederic Taylor to Oskar Lange attempting to respond to (and resolve) Mises’s argument that socialist economic calculation is impossible. And we see the same thing in the efficiency (and market failure) nonsense of Chicago school economists. The misconception is the same: that a working (and progressing) economy is about the management of existing production.

To be fair, if the economy is truly a matter of simply maintaining production processes, then it is certainly possible to rationally plan the whole thing. It may take more computing power than was possible in the 1920s and 1930s, but the data are all there. The problem is here only of a practical nature: to collect the data and to make sure the algorithms run smoothly enough to not cause delays in adjusting the central plan.

https://mises.org/wire/economy-not-factory%E2%80%94nor-should-we-try-make-it-one

Navigation

[0] Message Index