Retrospectives: Lange and von Mises, Large-Scale Enterprises, and the Economic Case for Socialism
In the debates over "economic calculation" launched by Ludwig von Mises in 1920 and extending well into the 1940s, the central issue concerned the ability of a socialist economy to achieve allocative efficiency. Von Mises emphasized that a collectivist state would have great difficulty in gathering and acting on relevant information; therefore, under socialism, even well-intentioned bureaucrats would lack a meaningful system of values on which to calculate. Defenders of socialism, such as Oskar Lange, countered that a market socialism could match demand to supply just as well as capitalism and meet the range of static conditions required for Pareto optimality. That debate is a rich and interesting story that has been told many times before. But in all that has been written, an important aspect of the original debate has been lost. Somewhat oddly, both the socialists like Oskar Lange and the advocates of private ownership like von Mises and Friedrich Hayek maintained that they were defending the progressive tendencies of competitive capitalism against the deadening hand of monopoly power. This historic paradox deserves consideration, if only because it serves to focus attention on our still incomplete theories of large-scale enterprises under socialism and capitalism.
Volume (Year): 5 (1991)
Issue (Month): 4 (Fall)
|Contact details of provider:|| Web page: https://www.aeaweb.org/jep/|
More information through EDIRC
|Order Information:||Web: https://www.aeaweb.org/subscribe.html|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Dearden, James & Ickes, Barry W & Samuelson, Larry, 1990.
"To Innovate or Not to Innovate: Incentives and Innovation in Hierarchies,"
American Economic Review,
American Economic Association, vol. 80(5), pages 1105-24, December.
- Dearden, J. & Ickes, B.W. & Samuelson, L., 1988. "To Innovate Or Not To Innovate: Incentives And Innovation In Hierarchies," Papers 9-88-4, Pennsylvania State - Department of Economics.
- Dearden, J. & Ickes, B.W. & Samuelson, L., 1988. "To Innovate Or Not To Innovate: Incentives And Innovation In Hierarchies," Papers 0-88-1, Pennsylvania State - Department of Economics.
- Domar, Evsey D, 1974. "On the Optimal Compensation of a Socialist Manager," The Quarterly Journal of Economics, MIT Press, vol. 88(1), pages 1-18, February.
- Tam, Mo-Yin S, 1981. "Reward Structures in a Planned Economy: The Problem of Incentives and Efficient Allocation of Resources," The Quarterly Journal of Economics, MIT Press, vol. 96(1), pages 111-28, February.
When requesting a correction, please mention this item's handle: RePEc:aea:jecper:v:5:y:1991:i:4:p:229-36. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Jane Voros)or (Michael P. Albert)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.