From: Anders Sandberg (asa@nada.kth.se)
Date: Mon Nov 18 2002 - 02:32:43 MST
On Sun, Nov 17, 2002 at 09:19:40AM -0800, Lee Corbin wrote:
> Anders writes
>
> > Let's say we try to use it to run a planned economy. We
> > try to make everybody equally well off in some material
> > sense. We make an allocation scheme, and it predicts the
> > outcome. OK, scheme 1 leads to a scarcity of food in
> > Manhattan, so let's up the bread allocation there. Now
> > scheme 2 leads to starvation in Chad....
>
> Yes, but what do you say about Oskar Lange? He seems to
> be tackling the problem at a higher level of abstraction
> where perhaps an impossibility argument isn't so clear.
Well, I actually assumed in my example that the above kind of iterations
would lead to some stable state that fulfilled the equality condition
and some other constraints. But I personally think a huge number of
iterations are needed since the human world is a highly chaotic
situation. The Lange argument is indeed on a higher level of
abstraction, but it seems to be based on the assumption of a static
economy (a condition endemic to many neoclassical economists) - new
products are added to the system and procedures change, and this
destabilizes the big plan. No wonder the Czech government accused Otto
Wichterle for "economic sabotage" when he developed contact lenses. That
centralized bureacuracies have no incentive to create development is
another serious problem, of course.
Determining the prices from stocks seems to be equivalent to solving a
large linear equation system, or more likely getting the eigenvalues of
it. Rather large effects can occur if one changes just one value a bit,
but adding an entirely new row and column can be even more drastic. A
market economy is essentially an iterative solution method, where the
iterations also cause the values to change according to a profit motive.
-- ----------------------------------------------------------------------- Anders Sandberg Towards Ascension! asa@nada.kth.se http://www.nada.kth.se/~asa/ GCS/M/S/O d++ -p+ c++++ !l u+ e++ m++ s+/+ n--- h+/* f+ g+ w++ t+ r+ !y
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