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Unformatted text preview: market via the price system, to organize the economy one of the main problems of the sot system, along with problems of political organization and political self-interest. The economic problem of knowledge is that without a market, and without a price system, one could never know if resources were being put into enterprises in a profitable way. Economic calculation would become impossible without information as to what resources were in relative scarcity and surplus, and this information changes daily, with only a few members of society being aware of it. Resources of all types are bound to be used inefficiently, and not substituted for others when a price system would call for it. For this reason, political incentives are what structure the economy rather than economic incentives. Therefore, totalitarianism is the logical conclusion of som....
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This document was uploaded on 10/27/2011 for the course MAP CA102 at NYU.
- Fall '10