TAILIEUCHUNG - Luận án kinh tế - "Human and action" - Chapter 26

XXVI. THE IMPOSSIBILITY OF ECONOMIC CALCULATION UNDER SOCIALISM 1. The Problem The director wants to build a house. Now, there are many methods that can be resorted to. Each of them offers, from the point of view of the director, certain advantages and disadvantages with regard | XXVI. THE IMPOSSIBILITY OF ECONOMIC CALCULATION UNDER SOCIALISM 1. The Problem The director wants to build a house. Now there are many methods that can be resorted to. Each of them offers from the point of view of the director certain advantages and disadvantages with regard to the utilization of the future building and results in a different duration of the building s serviceableness each of them requires other expenditures of building materials and labor and absorbs other periods of production. Which method should the director choose He cannot reduce to a common denominator the items of various materials and various kinds of labor to be expended. Therefore he cannot compare them. He cannot attach either to the waiting time period of production or to the duration of serviceableness a definite numerical expression. In short he cannot in comparing costs to be expended and gains to be earned resort to any arithmetical operation. The plans of his architects enumerate a vast multiplicity of various items in kind they refer to the physical and chemical qualities ofvarious materials and to the physical productivity of various machines tools and procedures. But all their statements remain unrelated to each other. There is no means of establishing any connection between them. Imagine the plight of the director when faced with a project. What he heeds to know is whether or not the execution of the project will increase well-being that is add something to the wealth available without impairing the satisfaction of wants which he considers more urgent. But none of the reports he receives give him any clue to the solution of this problem. We may for the sake of argument at first disregard the dilemmas involved in the choice of consumers goods to be produced. We may assume that this problem is settled. But there is the embarrassing multitude of producers goods and the infinite variety of procedures that can be resorted to for manufacturing definite consumers goods. The most .

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