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Bonus Quotation of the Day…

… is from page 171 of Israel Kirzner’s 1990 paper “Comments on the Debate Between Professors Leontief and Stein on National Economic Planning,” as this paper is reprinted in Competition, Economic Planning, and the Knowledge Problem (Peter J. Boettke and Frédéric Sautet, eds., 2018), which is a volume in The Collected Works of Israel M. Kirzner (original emphasis):

The crux of the matter is that every opportunity for entrepreneurial profit arises from the existence of two market prices for essentially the same product or the same bundle of inputs. This price divergence, which offers the opportunity for profit is, therefore, at the same time, evidence of an earlier failure of coordination among members or sectors of the economy. The drive to capture profit is, then, a drive to locate pockets of inefficiency. The successful capture of prime entrepreneurial profits occurs only through action which tends to eliminate the price spread and the inefficiency which was its cause. The ceaseless agitation of the market is thus not propelled by an undirected force, but by an extraordinarily sensitive detector of gaps in coordination. This agitation consists, therefore, in a continuing tendency to coordinate economic activity in the face of ceaseless changes in consumer preferences, resource availabilities, and technological knowledge.

DBx: In short, the free market is not akin to a drunk donkey.

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