the calculation problem and its misrepresentation

#./calcul.tex# We have argued elsewhere (Cottrell and Cockshott, 1993a) that the classic `socialist calculation debate' in the first part of this century took place on the terrain of the neoclassical critics of socialism rather than its Marxian advocates. This had an effect in defining the structure of the problem. In the neoclassical variant, the problem starts with the preferences of the individual agents and their production possibilities. This formulation is vulnerable to Hayek's critique, on the grounds that individuals' preferences are in no sense `given' to the planners. But Marxian economists would not accept that these individual preferences have any meaningful pre-1 existence;² they do not, therefore, form part of the problem.

The practical problem is to bring production potential into alignment with a pattern of social need revealed by a combination of democratic political decisions (as in the case of, say, the appropriate level of public health service provision) and aggregate consumer purchases. Given a reasonable data-collection system reporting on the rates at which consumer goods are selling, and assuming a pricing system based on labour values (Cockshott and Cottrell, 1993), deriving a target net-output vector demands no special telepathic powers on the part of the planning system. It is perhaps harder to gather the information about production possibilities. It is in this practical context that Hayek's discussion of centralised versus decentralised control systems must be placed.

#./calcul.tex#