As long as we're on the topic of the socialist calculation debates, it is interesting to note that Joseph Schumpeter had a different take on them than did either von Mises or Hayek. Like them, he was a product of the Austrian School, but unlike them, his thinking was more reflective of the early Austrian School which wasn't quite so dogmatic as the later Austrian School. Like von Mises and Hyaek, Schumpeter was opposed to socialism and preferred free market capitalism. However, he was convinced that socialism was feasible and he was well aware that socialism had many clever advocates including his teaching assistant, the young Paul Sweezy, who were perhaps just clever enough to make it work.
In his posthumously published book *History of Economic Analysis* ( http://digamo.free.fr/schumphea.pdf ) he presented the following critique of von Mises: "The essential result of Barone’s or any similar investigation is that there exists for any centrally controlled socialism a system of equations that possess a uniquely determined set of solutions, in the same sense and with the same qualifications as does perfectly competitive capitalism, and that this set enjoys similar maximum properties. Less technically, this means that so far as its pure logic is concerned the socialist plan makes sense and cannot be disposed of on the ground that it would necessarily spell chaos, waste, or irrationality. This is no small thing and we are within our rights when we emphasize again the importance of the fact that this service to socialist doctrine has been rendered by writers who, since they were not socialists themselves, thereby victoriously vindicated the independence of economic analysis from political preference or prejudice. But, at the same time, this is all. We must not forget that, just like the pure theory of the competitive economy, the pure theory of socialism moves on a very high level of abstraction and proves much less for the ‘workability’ of the system than laymen (and sometimes theorists also) think. In particular, the proposition about the maximum properties of the solution that characterizes the equilibrium of a socialist economy is of course relative to its institutional data, and avers nothing concerning the question whether this purely formal maximum is higher or lower than the corresponding maximum of the competitive economy—especially if we refuse to go into the further questions, whether the one or the other institutional set-up is less exposed to deviations from its own ideal or more favorable to ‘progress.’ These questions are so much more important in practice than is the question of determinateness or ‘rationality’ per se, that it is sometimes not easy to tell whether the later critics of the socialist plan, especially von Mises, really meant to deny the validity of the Pareto-Barone result. For it is quite possible to accept it and yet to hold that the socialist plan, owing to the administrative difficulties involved or for any other of a long list of reasons, is ‘practically unworkable’ in the sense that it cannot be expected to work with an efficiency comparable to the efficiency of capitalist society as revealed by the index of total output. But although pure theory contributes little to the solution of these problems, it helps us to posit them correctly and to narrow the range of justifiable difference of opinion. We thus arrive at the same conclusion as in the case of nonsocialist planning; ever since Marshall, the theoretical possibility of improving the purely competitive mechanism by public policy should no longer be a matter of controversy; but it is of course still possible—as Marshall well understood—to criticize either particular measures or even the whole idea of planning on such grounds as lack of confidence in the political or administrative organs that are available for the task. (It seems as if Marshall had been alone in understanding this situation.)" In fairness to von Mises, he did see significant administrative problems likely under socialism that could cancel out whatever efficiency gains that might otherwise be possible but it is also clear that he had little doubt concerning its practical feasibility. -=-=-=-=-=-=-=-=-=-=-=- Groups.io Links: You receive all messages sent to this group. View/Reply Online (#7339): https://groups.io/g/marxmail/message/7339 Mute This Topic: https://groups.io/mt/81375137/21656 -=-=- POSTING RULES & NOTES #1 YOU MUST clip all extraneous text when replying to a message. #2 This mail-list, like most, is publicly & permanently archived. #3 Subscribe and post under an alias if #2 is a concern. -=-=- Group Owner: [email protected] Unsubscribe: https://groups.io/g/marxmail/leave/8674936/21656/1316126222/xyzzy [[email protected]] -=-=-=-=-=-=-=-=-=-=-=-
