Economic calculation problem

[dubaba]

http://en.wikipedia.org/wiki/Economic_calculation_problem

Im having trouble refuting this one.

[Tim Cornelis]

There are numerous articles on economic calculation.

For example: Calculation in-Natura, from Neurath to Kantorovich (http://www.dcs.gla.ac.uk/~wpc/reports/standalonearticle.pdf)

Essentially, in a socialist society opportunity costs are calculated in kind (http://en.wikipedia.org/wiki/Calculation_in_kind) instead of a universal unit of account.

[molotovcocktail]

Counter arguments:
1) Today, computers can calculate the prices.

2) The market is not especially good at calculating the prices either, objects tend to end up with a too high pricing. That is the mechanism behind bubbles

[Rafiq]

The "Socialism and Calculation" problem argument is a straw man argument.


It assumes that one little party or organization will account for all of society. It's basically the free market equivalent to the Ontological argument for the existence of a god.

[Vladimir Innit Lenin]

The economic calculation is a poor critique of planning, and certainly not something that lends itself well to pro-market solutions, as we have plenty of evidence that prices do not actually convey information about value, nor about embedded costs, in themselves. If they convey information, it is about the attitude of the buyer and the attitude of the seller, their reservation prices.

As i've expounded numerous times, the price is only the exchange value, which is an unfortunate phrase because it is 'value' in name only; it has little to do with accurate measurement of the intrinsic value of the product, of the inputs (especially labour) and can be hugely distorted by irrational micro-behaviour and external factors - currency, bubbles etc.