Entrepreneurship and Decentralised Investment in a Planned Economy
A Critique of the Austrian Reading
In: Historical MaterialismSearch for other papers by Maxi Nieto in
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Abstract
Since the 1980s, authors of the Austrian School have argued that the problem of rational allocation in a planned economy is not computational or technical in nature (static optimisation, with given information) but a question of dynamic efficiency (innovation and the creation of new information), and that this would be impossible without market processes and free entrepreneurship. In this article, we argue to the contrary that a planned economy can effectively drive dynamic efficiency. We first reveal that the Austrian thesis on the impossibility of dynamic efficiency in socialist planning is based on tautological arguments, or on problems already solved by technological development. Secondly, we present an institutional formula for promoting innovative activities and entrepreneurship within a framework of social ownership of the means of production and social control of investment.
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Entrepreneurship and Decentralised Investment in a Planned Economy
A Critique of the Austrian Reading
In: Historical MaterialismSearch for other papers by Maxi Nieto in
Current site
Google Scholar
PubMed
Abstract
Since the 1980s, authors of the Austrian School have argued that the problem of rational allocation in a planned economy is not computational or technical in nature (static optimisation, with given information) but a question of dynamic efficiency (innovation and the creation of new information), and that this would be impossible without market processes and free entrepreneurship. In this article, we argue to the contrary that a planned economy can effectively drive dynamic efficiency. We first reveal that the Austrian thesis on the impossibility of dynamic efficiency in socialist planning is based on tautological arguments, or on problems already solved by technological development. Secondly, we present an institutional formula for promoting innovative activities and entrepreneurship within a framework of social ownership of the means of production and social control of investment.
| All Time | Past Year | Past 30 Days | |
|---|---|---|---|
| Abstract Views | 640 | 364 | 25 |
| Full Text Views | 48 | 18 | 1 |
| PDF Views & Downloads | 121 | 50 | 5 |