Economic calculation problem: Difference between revisions
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The '''economic calculation problem''' is a criticism of using [[economic planning]] as a substitute for [[Market (economics)|market-based]] allocation of the [[factors of production]]. It was first proposed by [[Ludwig von Mises]] in his 1920 article "[[Economic Calculation in the Socialist Commonwealth]]" and later expanded upon by [[Friedrich Hayek]]. | The '''economic calculation problem''' is a criticism of using [[economic planning]] as a substitute for [[Market (economics)|market-based]] allocation of the [[factors of production]]. It was first proposed by [[Ludwig von Mises]] in his 1920 article "[[Economic Calculation in the Socialist Commonwealth]]" and later expanded upon by [[Friedrich Hayek]]. F. A. Hayek, (1935), "The Nature and History of the Problem" and "The Present State of the Debate," in F. A. Hayek, ed. ''Collectivist Economic Planning'', pp. 1–40, 201–43.</ref> In his first article, Mises describes the nature of the price system under capitalism and describes how individual [[subjective value theory|subjective values]] are translated into the objective information necessary for [[Rational choice theory|rational]] allocation of resources in society.{{citation needed|date=May 2013}} | ||
Revision as of 18:12, 26 December 2015
The economic calculation problem is a criticism of using economic planning as a substitute for market-based allocation of the factors of production. It was first proposed by Ludwig von Mises in his 1920 article "Economic Calculation in the Socialist Commonwealth" and later expanded upon by Friedrich Hayek. F. A. Hayek, (1935), "The Nature and History of the Problem" and "The Present State of the Debate," in F. A. Hayek, ed. Collectivist Economic Planning, pp. 1–40, 201–43.</ref> In his first article, Mises describes the nature of the price system under capitalism and describes how individual subjective values are translated into the objective information necessary for rational allocation of resources in society.[citation needed]