Abstract
The socialist calculation debate centred on two questions: could a socialist society use planning to replicate the performance of a capitalist society? And could socialism improve on capitalism? Many economists answered both questions in the affirmative until shortly before the demise of the planned economies of the Soviet bloc. The calculation debate was about the interactions among models, motives and incentives. In hindsight, it is evident that the incentives in a planned economy are such that planners are not motivated to promote the public interest.
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Levy, D.M., Peart, S.J. (2018). Socialist Calculation Debate. In: The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-95189-5_2070
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DOI: https://doi.org/10.1057/978-1-349-95189-5_2070
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