Quotation of the Day…

by Don Boudreaux on May 19, 2017

in Competition, Economics, Hayek

… is from page 12 of the original printing of my colleague Larry White’s splendid 1977 monograph, Methodology of the Austrian School (footnote deleted; ellipses original to White; link added):

The market economy for Hayek is an information-gathering process, and this concept springs directly from his subjectivist outlook.  In the task of using “available” resources to satisfy “existing” needs, “neither the ‘available’ resources nor the ‘existing’ needs are objective facts.”  Resources and needs “exist for practical purposes only through somebody knowing about them.”  The fact that each individual’s knowledge is limited and specialized means that “a successful solution … must be based on a method of utilizing the knowledge dispersed among all members of society….  This is precisely the function which the various ‘markets’ perform.”


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