Why Socialism Is Not Just Undesirable, But Impossible

lightfiend · Oct 21, 2009

VIDEO: Joseph Salerno On Calculation And Socialism

The economic calculation problem is a criticism of socialist economics, or more precisely central economic planning. It was first proposed by Ludwig von Mises in 1920 and later expounded by Friedrich Hayek. The problem referred to is that of how to distribute resources rationally in an economy. The free market solution is the price mechanism, wherein people individually have the ability to decide how a good should be distributed based on their willingness to give money for it. The price conveys embedded information about the abundance of resources as well as their desirability which in turn allows, on the basis of individual consensual decisions, corrections that prevent shortages and surpluses; Mises and Hayek argued that this is the only possible solution, and without the information provided by market prices socialism lacks a method to rationally allocate resources. Those who agree with this criticism argue it is a refutation of socialism and that it shows that a socialist planned economy could never work. The debate raged in the 1920s and 1930s, and that specific period of the debate has come to be known by economic historians as the The Socialist Calculation Debate.
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aaronman · Oct 22, 2009

Ow my brain, too many words.

Me hungry. Me want food now. Me want health care.

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Why Socialism Is Not Just Undesirable, But Impossible

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Why Socialism Is Not Just Undesirable, But Impossible

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aaronman n'wah

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