I am glad I have made my point clear about the way I understand the calculation problem.
Please notice that I do not think it is a global problem. As i said, we know that some sectors can be planned effectively -- and that others can't, so far as the evidence and theory to date has shown. The latter are the ones that call for markets.
I do not pretend, or assert, that markets are not riddled -- loaded -- fraught -- top-heavy -- with dysfunctional incentives of all sorts. But the issue is comparative. As long as everyone is provided with a reasonable minimum income, either through a job or or other payment, markets function better than plans in some sectors. (Not in others.) That does not mean they are not imperfect, dangerous, risky, and problematic. Sometimes life involves choices among evils.
Btw, the informational disincentives involved with planning cannot be fixed by abolishing material incentives. The problem is not that people are working for pay and therefore have some sort of incentive to lie about their needs and capabilities in order to get more money. It's that the process of planning for targets produces these dysfunctional incentives.
Even assuming a "to each according to his needs" (insofar as the plan can provide that) form of remuneration, people will still, in their desire (wholly altruistic, we may assume) to reach the plan target, have an incentive to say they need more than they really do and that they can do less than they really can. That way they will be more likely to hit the target -- but the whole system will be full of misinformation.
Unlike the case with markets, which also generate misinformation, there is no self-corrective mechanism. If the market overvalues a stock or someone mistakenly infers from sales of Xs that demand for X-like things is hot, the market will sort things out in its usual brutal, cruel, heavy-handed manner. (Crash! Your stock went through the floor! You're bankrupt!) What happens, though, when the very system of target planning gives workers an incentive to lie? What makes them tell the truth or gives planners or the system as a whole the correct information? Especially if thery can't be fired, disciplined, pout out of business, or otherwise suffer the consequences for bad decisions and systematic misrepresentation.
This is only one (though a very important) information incentive for epistemological error that generates the set of problems tied up in the calculation problem. There are others as well.
We are in agreement about parecon.
--- Bill Bartlett <billbartlett at aapt.net.au> wrote:
> At 4:45 PM -0800 17/12/06, andie nachgeborenen
> wrote:
>
>
> >With other sectors, consumer and production goods,
> >labor itself, there is no reason to think that
> anyone,
> >including C&C, have presented a plausible solution
> to
> >the calculations problems. C&C seem to think that
> the
> >answer is just more powerful computers (I
> oversimplify
> >a good deal.) They fail to notice the
> epistemological
> >bad incentives target planning gives producers to
> >overstate their needs and understate their
> >capabilities. (Just for one.)
>
> I see what you are saying now. The objection you
> raise is that of
> inappropriate incentives, I thought you were saying
> that there were
> two distinct problems with socialist economic
> planning, information
> and disincentives. I gather now that you identify
> only one
> fundamental problem - dysfunctional incentives,
> which leads to poor
> information, which makes planning impossible.
>
> Of course one could reply glibly that dysfunctional
> incentives is
> hardly something that market systems are innocent of
> either, but that
> hardly answers the objection.
>
> I agree that it is a real issue. The solution seems
> obvious - abolish
> the disincentives. Which couldn't be easier -
> abolish all material
> incentives. That is to say, we need to recognise
> that disincentives
> are merely the other side of the same coin as
> incentives.
>
> >I think C&C do far better than Albert & Hahnel,
> whose
> >parecon is a Misean-Hayekean disaster in spades, as
> >well as a silly utopian socialist cult. But not
> good
> >enough. I'll stick with Schweickart and the early
> >Kornai and Brus. Until I see a better answer to the
> >calculation problem, I'll stay a market socialist
> as
> >described.
>
> You flatter Parecon by describing it as either
> "socialist" or
> "utopian". Actually, even "disaster" is flattery in
> my book. But I
> maintain my objection that "market socialism" is a
> contradiction in
> terms and suspect that it too is riddled with
> dysfunctional
> incentives. Of course using using markets solve the
> problem of
> effective (central) planning by not having any, but
> that seems a bit
> defeatist. It doesn't solve the inherent problem of
> dysfunctional
> motivation and incentives in market based systems to
> pretend they
> don't exist though.
>
> Bill Bartlett
> Bracknell Tas
> ___________________________________
>
http://mailman.lbo-talk.org/mailman/listinfo/lbo-talk
>
__________________________________________________ Do You Yahoo!? Tired of spam? Yahoo! Mail has the best spam protection around http://mail.yahoo.com