… The 2015 Mercatus Center is from page 143 of my late colleague Don Lavoie’s insightful book, 1985 Competition and central planning:
Since rule-following behavior cannot be legitimately inferred from the existence of a published rule, the analyst must apply choice theory to explain the spontaneous actions people may take when confronted with perceived rules. Just as a rule is presented as a direct substitute for self-motivation, it is possible to clearly define how to distinguish compliance from disobedience, how to provide sanctions for disobedience, and to clearly define the rewards and actions required for compliance. Rules should be checked.
The fundamental difference between the self-directed act of profit-seeking and the other-directed act of obedience to rule is completely obscured in the socialist discussion of the market. There is nothing to say that the allocation of responsibilities should replace private ownership of legal institutions. There is no basis for the implicit claim that this prescribed behavior is consistent with the intention of the legislators.
DBXDon points out one of the many flaws in the arguments of the so-called “market socialists” – a group of economists active in the second quarter of the 20th century who insisted that government officials could market the market. Allocating resources in such a way as to achieve the desired economic efficiency. Although the detailed proposals and arguments of today’s industrial policy advocates differ from the proposals and arguments of the “market socialists,” the two interventionist groups are fundamentally the same. Both believe that the free market cannot be trusted to produce good economic results, so the government can intervene and engineer the desired results.
However, as it turns out, in particular, Ludwig von Mises, FA Hayek, Trygve JB HoffAnd Don LavoieAdvocates of such intervention take for granted many of the important problems that any economic process must ‘solve’. The biggest of these problems is the challenge of collecting and effectively using data from millions of minds and scattered across square miles. Industrial policy advocates, no more than socialists, failed to explain how their plan would ‘solve’ data collection and use in ways that would improve overall safety. (Actually, as far as industrial policy advocates are concerned, they’re not even worried try out To explain how their plan solves this problem. Industrial policy advocates simply Guess – If only indirectly – this problem is eliminated.)
But there are other problems besides the data. One of these other problems is identified in the above quote from Don Lavoie (pictured above).
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