Bonus Quotation of the Day…

by Don Boudreaux on January 28, 2021

in Complexity & Emergence, Prices, Seen and Unseen

… is from page 148 of the original Cambridge University Press edition of the late Don Lavoie’s great 1985 book Rivalry and Central Planning:

Hence it is not enough to establish the technological feasibility of a production plan; it is also necessary to determine its economic cost – that is, the value of opportunities forgone by this plan. The complexity of deliberately tracing out such cost implications of each plan necessitates that this be done unconsciously by relying on the information supplied by a price system.

DBx: This reality is ignored by advocates of industrial policy. Their failure to grasp the enormous complexity of market arrangements combines with their ignorance of the role of prices to fool them into thinking that their schemes can work.

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