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Economic Calculation in the Socialist Commonwealth
This is the essay that overthrew the socialist paradigm in economics, and provided the foundation for modern Austrian price theory. When it first appeared in 1920, Mises was alone in challenging the socialists to explain how their pricing system would actually work in practice. Mises proved that socialism could not work because it could not distinguish more or less valuable uses of social resources, and predicted the system would end in chaos. The result of his proof was the two-decade-long "socialist calculation" debate. This new edition contains an afterword by Joseph Salerno, who applies the calculation argument to contemporary problems like environmentalism and business regulation.
74 pages, Paperback
First published January 1, 1920
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About the author
Ludwig von Mises
262 books1,234 followersLudwig Heinrich Edler von Mises (German pronunciation: [ˈluːtvɪç fɔn ˈmiːzəs]; September 29, 1881 – October 10, 1973) was an Austrian economist, historian, philosopher, author, and classical liberal who had a significant influence on the Austrian government's economic policies in the first third of the 20th century, the Austrian School of Economics, and the modern free-market libertarian movement.
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February 18, 2022
The premise of any ECP argument is (1) without markets, there is no economic calculation, (2) without economic calculation there can be no rational economy, (3) without rational economy, there stable system. If #1 is true, then the rest inevitably follow, so proving the premise of #1 is the most important, demonstrating that without markets, there can be no economic calculation.
While I am by no means an advocate of going out and implementing a totally planned economy, I usually have viewed this as an issue of practicality, of limitations in infrastructure, i.e. the ability to collect necessary and transmit information for economic planning, and technology, i.e. the ability to efficiently compute that information. Some planning, thus, can be in effect, as long as is it corresponds to level of infrastructure and technology, or in other words, it's a problem of information and computation.
I was interested in reading Mises' work as often I have been told that his book "proves" that with infinite access to information and computation, a planned economy still could not be achieved. This seems rather absurd to me. Clearly, if you knew what everyone wanted, and exactly how to achieve it, then you could, at least, on paper, do it, even if the "knowing" part may be impractical in reality. However, after reading Mises' book, I was rather disappointed, as this is not his argument at all, and indeed his argument is incredibly boring and juvenile.
Mises does, indeed, use as the premise of his argument that he can conceive of sufficient information, i.e. that he accepts as a premise that a planned economy could know everything it needs to know to plan:
Mises even accepts that planned is not inherently impossible, at least on a small scale.
Notice his language here: it is possible to plan an economy on a small scale because the entire production process can be easily supervised from beginning to end. Mises sees this as a form of "computation" where the individual is computing the effects of his labor by seeing whether or not it produces increased or decreased output. In a economic system, every producer engages in these kinds of computations on a mass scale. The economy thus decentralizes computation.
So far, none of this is interesting. Pretty much everyone agrees with this. Market economies decentralize calculation, since every enterprise has to figure out a sufficient price based on the value they added to the manufacture, and thus as the manufacture moves up the supply chain once it hits the top the entire supply chain has been calculated.
The question is still open, though. If you had all information on the supply chain in its entirety, why couldn't you just calculate it directly? Mises beats around the bush with this question for quite awhile.
Here he arbitrarily divides between "lower" and "higher" order enterprises where the lower order produce directly for consumption and the higher orders produce capital goods to be allocated to the lower orders. He says because there is no market here, they could "test their bearings".
Yet, he fails to justify this. He himself said that you could plan an economy if you could see if changes in production lead to greater or lower consumption.
First, his distinction between the two "orders" is vague. The two orders are still "producing" and "consuming". Even though the manufacturers producing means of production do not sell these on a market, they can still clearly see whether or not any change in the production process yields to a higher or lower yield.
Second, even if we accept his vague distinction, it still is unjustified. A centrally planned economy, which Mises already allows the assumption that it has sufficient information to plan, would already know the inputs and outputs to al its enterprises as well as what consumers want. So even a tiny change on the highest orders could then be computed how this affects all lower orders and even how it impacts consumption (Paul Cockshott in his book "Towards a New Socialism" discusses how this can be performed using input-output tables).
So, really, this argument isn't an argument. It leaves the question on the table: why could they not perform this kind of economic calculation? Here we get to the core of Mises' argument, finally, and it is, to put it bluntly, a genuine piece of comedy.
Mises' argument is that calculation is impossible because there is just too much complexity for "the human mind" to compute. In fact, his argument is even worse, because he seems to think that people who imagine a planned economy imagine it not just planned by "the human mind," but very specifically "the mind of one man alone."
Okay, I can cut Mises' a tiny bit of slack. This book was written in the 1930. Computers wouldn't become much of a thing until the 1930s. So discussions of planning early on would've mostly imagined it being done by people. But I cannot cut anyone slack who actually cites this book on the 21st century as a convincing argument.
If you think I am misrepresenting Mises, my version of the book also has a post-script from another Austrian economist, Joseph Salerno, who summarizes the argument the same why I did.
This book later criticizes the use of labor time as a unifying way to measure economic efficiency. I don't find this particularly interesting because one can imagine thousands of ways to organize a planned economy, and this is just an attack on a specific proposal.
In fact, Mises, in the first quote I gave, accepts that the planners could know what consumers want, and obviously producing more of what consumers want is desirable. In fact, more than this, Mise also says, "it is not difficult to decide whether it desires 1,000 hectolitres of wine rather than 500 of oil," i.e. Mises also accepts that different subjective evaluations between goods and services can be known.
If this were the case, then one could also "test their bearings" without any sort of "calculation in natura" at all, since one would know how that society would subjectively evaluate the products. One could compute how to distribute capital to the manufactures since they would already know exactly what needs to be produced and in what ratios, and then could "test their bearings" by making a small change to the production process of the higher order and then observing precisely how this affects not just the lower orders but how that this in turn affects consumption (since all interconnections between enterprises are known) and thus whether or not it more appropriately or less appropriate matches the already-known consumer desires.
Nowhere in this book could I even find any sort of attack on the prime argument of Marxists. It seems to be touted as the ultimate "defeat" of Marxism, but it never even addresses the core argument. The core tenet of Marxism being historical materialism, the viewpoint that no economic system is eternal, but are built upon certain conditions which are always changing, and thus new economic systems constantly arise, only to eventually fall apart, and make way for a new society.
In capitalism in particular, Marx's fundamental thesis is that capitalism is based on competitive markets, but competitive markets have tons of means, which Marx refers to as the "laws of the centralisation and concentration of capitals," which causes market economies to have a tendency to move more and more towards monopolization over time, by the very mechanisms by which defenders of capitalism praise: innovation.
Market competition pressures enterprises to constantly improve upon the production process, to constantly scale up infrastructure and technology. This, in turn, makes them grow larger and larger over time, the barrier of entry to grow larger and larger, and for "mature" enterprises to eventually form into natural monopolize as hundreds of billions of dollars worth of capital will be necessary to even begin to compete with the immense scale of technology and infrastructure.
This is fundamentally why Marxists argue that capitalism is inherently a temporary system, because it is based on decentralizes, yet has a tendency to very gradually centralize the more time progresses. If a person argues that a centralized society would inherently be "impossible," but does not address the point regarding capitalism's tendency to centralize, then this does not defeat Marxism. It only leads into a contradiction, where capitalism will inherently devolve into an "impossible" economy, one that in their mind would be very irrational and inefficient, albeit still inevitable.
I said I would cut Mises some slack, but not entirely. We cannot see things that are microscopic with the naked eye by definition. But we can still see them using a microscope, using a tool. Marx did not predict the modern computer, either, but he understood that as enterprises on the market continually scale and innovate, they are continually solving these problems. They are continually finding new ways to collect necessary information, and to compute it, in order to plan out the production of even larger and larger enterprises. Marx did not predict the modern computer exactly, but it inevitably falls out of his understanding that the capitalists will, at some point, develop a tool to enhance computation. Mises could not imagine this, he could not see beyond his nose.
Mises also makes it clear that his argument only applies to a fully planned economy. For example, he says an economy with some public planning could still be functional because public enterprise would still by and sell on the market, it would be an "oasis" of planning surrounded by markets which it could use to for reference.
This, however, leaves a huge open question which he never addresses. If he admits some planning is possible, then when exactly is the threshold for when it becomes impossible? This is not a trivial point as Marxists have never believed in "pure" economies in the first place but have always accepted all economies have internal contradictions within themselves, i.e. a socialist economy can have markets, this has long been accepted by every major Marxist author. Even Stalin, who went the furthest with economic planning, still did not go fully, maintaining a level of markets in the "kolkhoz" sector and in his Economic Problems of Socialism in the USSR argue that maintaining a level of markets was useful because they allowed a reference for rational economic calculation.
If one does not demonstrate the threshold between planning and markets, even if they successfully prove that a purely planned economy would be impossible (which Mises comically fails to do so with his appeals to the limited computational power of "the human mind"), they have failed to demonstrate socialism is impossible, nor have they failed to demonstrate that capitalism will not eventually give way to a society where public control reigns supreme over the interests of profits. All they have shown is that this society would not be able to exist in a pure form.
In reality, thus, Mises' argument really only addresses a very particular kind of socialist, those who advocate for implementing a fully planned economy in its entire in the the present era. Well, not even the present era, but in the early 20th century, prior to the invention of the modern computer, where all computations would be carried out solely by "the human mind."
This is thus rather disconnected from, for example, Chinese Marxist orthodoxy, which is the most prevalent today. This would mean any Chinese Marxist of its orthodoxy who reads this book would find that it is not even really relevant.
Ultimately, this book is outdated, as nobody is arguing for computation of the entire economy with "the human mind," as it is well understood by advocates of this that thus a thing would be carried out using tools for computation, particularly computers. In fact, it's already largely being done, computers are heavily integrated into pretty much every large-scale enterprise in order to plan its operations, and enterprises would not have been able to efficiently scale up to the size the behemoths they are today without these tools. I'm also not sure what is with the reference to "a single human mind", as nobody ever argued a single person, even back in the 20th century, would plan the whole economy alone.
Not only is the book outdated, but it's not entirely relevant as a rebuttal to Marxists. It is only relevant to a small subsection of socialist who want to implement a fully planned economy right now. They could easily just rebut this entire book, though, by pointing to the existence of computers.
Hence, no one in the 21st century should unironically use this book as an argument. Even against its intended target it is outdated for the current century. Any book that actually wants to attack Marxism has to: (1) take into consideration that computational power will gradually improve over time and is not constant (something Mises failed to do, as he imagined computation forever would be carried out by the "human mind"), and (2) establish the threshold on which this will render further planning unfeasible. This book establishes neither of these things.
While I am by no means an advocate of going out and implementing a totally planned economy, I usually have viewed this as an issue of practicality, of limitations in infrastructure, i.e. the ability to collect necessary and transmit information for economic planning, and technology, i.e. the ability to efficiently compute that information. Some planning, thus, can be in effect, as long as is it corresponds to level of infrastructure and technology, or in other words, it's a problem of information and computation.
I was interested in reading Mises' work as often I have been told that his book "proves" that with infinite access to information and computation, a planned economy still could not be achieved. This seems rather absurd to me. Clearly, if you knew what everyone wanted, and exactly how to achieve it, then you could, at least, on paper, do it, even if the "knowing" part may be impractical in reality. However, after reading Mises' book, I was rather disappointed, as this is not his argument at all, and indeed his argument is incredibly boring and juvenile.
Mises does, indeed, use as the premise of his argument that he can conceive of sufficient information, i.e. that he accepts as a premise that a planned economy could know everything it needs to know to plan:
It will be evident, even in the socialist society, that 1,000 hectolitres of wine are better than 800, and it is not difficult to decide whether it desires 1,000 hectolitres of wine rather than 500 of oil. There is no need for any system of calculation to establish this fact: the deciding element is the will of the economic subjects involved.
Mises even accepts that planned is not inherently impossible, at least on a small scale.
Only under simple conditions can economics dispense with monetary calculation. Within the narrow confines of household economy, for instance, where the father can supervise the entire economic management, it is possible to determine the significance of changes in the processes of production, without such aids to the mind and yet with more or less of accuracy. In such a case the process develops under a relatively limited use of capital. Few of the capitalistic roundabout processes of production are here introduced: what is manufactured is, as a rule, consumption goods or at least such goods of a higher order as stand very near to consumption-goods…In the narrow confines of a closed household economy, it is possible throughout to review the process of production from beginning to end, and to judge all the time whether one or another mode of procedure yields more consumable goods.
Notice his language here: it is possible to plan an economy on a small scale because the entire production process can be easily supervised from beginning to end. Mises sees this as a form of "computation" where the individual is computing the effects of his labor by seeing whether or not it produces increased or decreased output. In a economic system, every producer engages in these kinds of computations on a mass scale. The economy thus decentralizes computation.
Now, in the economic system of private ownership of the means of production, the system of computation by value is necessarily employed by each independent member of society. Everybody participates in its emergence in a double way: on the one hand as a consumer and on the other as a producer. As a consumer he establishes a scale of valuation for goods ready for use in consumption. As a producer he puts goods of a higher order into such use as produces the greatest return.
So far, none of this is interesting. Pretty much everyone agrees with this. Market economies decentralize calculation, since every enterprise has to figure out a sufficient price based on the value they added to the manufacture, and thus as the manufacture moves up the supply chain once it hits the top the entire supply chain has been calculated.
The question is still open, though. If you had all information on the supply chain in its entirety, why couldn't you just calculate it directly? Mises beats around the bush with this question for quite awhile.
Every good will go through a whole series of stages before it is ready for use. In the ceaseless toil and moil of this process, however, the administration will be without any means of testing their bearings. It will never be able to determine whether a given good has not been kept for a superfluous length of time in the necessary processes of production, or whether work and material have not been wasted in its completion. How will it be able to decide whether this or that method of production is the more profitable?
Here he arbitrarily divides between "lower" and "higher" order enterprises where the lower order produce directly for consumption and the higher orders produce capital goods to be allocated to the lower orders. He says because there is no market here, they could "test their bearings".
Yet, he fails to justify this. He himself said that you could plan an economy if you could see if changes in production lead to greater or lower consumption.
First, his distinction between the two "orders" is vague. The two orders are still "producing" and "consuming". Even though the manufacturers producing means of production do not sell these on a market, they can still clearly see whether or not any change in the production process yields to a higher or lower yield.
Second, even if we accept his vague distinction, it still is unjustified. A centrally planned economy, which Mises already allows the assumption that it has sufficient information to plan, would already know the inputs and outputs to al its enterprises as well as what consumers want. So even a tiny change on the highest orders could then be computed how this affects all lower orders and even how it impacts consumption (Paul Cockshott in his book "Towards a New Socialism" discusses how this can be performed using input-output tables).
So, really, this argument isn't an argument. It leaves the question on the table: why could they not perform this kind of economic calculation? Here we get to the core of Mises' argument, finally, and it is, to put it bluntly, a genuine piece of comedy.
[O]nce this decision has been taken [on what to produce based on the information gathered of consumer demand], the real task of rational economic direction only commences, i.e., economically, to place the means at the service of the end. That can only be done with some kind of economic calculation. The human mind cannot orientate itself properly among the bewildering mass of intermediate products and potentialities of production without such aid. It would simply stand perplexed before the problems of management and location.
Mises' argument is that calculation is impossible because there is just too much complexity for "the human mind" to compute. In fact, his argument is even worse, because he seems to think that people who imagine a planned economy imagine it not just planned by "the human mind," but very specifically "the mind of one man alone."
[T]he mind of one man alone — be it ever so cunning, is too weak to grasp the importance of any single one among the countlessly many goods of a higher order. No single man can ever master all the possibilities of production, innumerable as they are, as to be in a position to make straightway evident judgments of value without the aid of some system of computation.
Okay, I can cut Mises' a tiny bit of slack. This book was written in the 1930. Computers wouldn't become much of a thing until the 1930s. So discussions of planning early on would've mostly imagined it being done by people. But I cannot cut anyone slack who actually cites this book on the 21st century as a convincing argument.
If you think I am misrepresenting Mises, my version of the book also has a post-script from another Austrian economist, Joseph Salerno, who summarizes the argument the same why I did.
Mises’s pathbreaking and central insight is that monetary calculation is the indispensable mental tool for choosing the optimum among the vast array of intricately-related production plans that are available for employing the factors of production within the framework of the social division of labor. Without recourse to calculating and comparing the benefits and costs of production using the structure of monetary prices determined at each moment on the market, the human mind is only capable of surveying, evaluating, and directing production processes whose scope is drastically restricted to the compass of the primitive household economy...a single human mind — even if it were miraculously endowed with complete and accurate knowledge of the quantities and qualities of the available factors of production, of the latest techniques for combining and transforming these factors into consumer goods, and of the set of all individuals’ value rankings of consumer goods — would be utterly incapable of determining the optimal pattern of resource allocation or even if a particular plan was ludicrously and destructively uneconomic
This book later criticizes the use of labor time as a unifying way to measure economic efficiency. I don't find this particularly interesting because one can imagine thousands of ways to organize a planned economy, and this is just an attack on a specific proposal.
In fact, Mises, in the first quote I gave, accepts that the planners could know what consumers want, and obviously producing more of what consumers want is desirable. In fact, more than this, Mise also says, "it is not difficult to decide whether it desires 1,000 hectolitres of wine rather than 500 of oil," i.e. Mises also accepts that different subjective evaluations between goods and services can be known.
If this were the case, then one could also "test their bearings" without any sort of "calculation in natura" at all, since one would know how that society would subjectively evaluate the products. One could compute how to distribute capital to the manufactures since they would already know exactly what needs to be produced and in what ratios, and then could "test their bearings" by making a small change to the production process of the higher order and then observing precisely how this affects not just the lower orders but how that this in turn affects consumption (since all interconnections between enterprises are known) and thus whether or not it more appropriately or less appropriate matches the already-known consumer desires.
Nowhere in this book could I even find any sort of attack on the prime argument of Marxists. It seems to be touted as the ultimate "defeat" of Marxism, but it never even addresses the core argument. The core tenet of Marxism being historical materialism, the viewpoint that no economic system is eternal, but are built upon certain conditions which are always changing, and thus new economic systems constantly arise, only to eventually fall apart, and make way for a new society.
In capitalism in particular, Marx's fundamental thesis is that capitalism is based on competitive markets, but competitive markets have tons of means, which Marx refers to as the "laws of the centralisation and concentration of capitals," which causes market economies to have a tendency to move more and more towards monopolization over time, by the very mechanisms by which defenders of capitalism praise: innovation.
Market competition pressures enterprises to constantly improve upon the production process, to constantly scale up infrastructure and technology. This, in turn, makes them grow larger and larger over time, the barrier of entry to grow larger and larger, and for "mature" enterprises to eventually form into natural monopolize as hundreds of billions of dollars worth of capital will be necessary to even begin to compete with the immense scale of technology and infrastructure.
This is fundamentally why Marxists argue that capitalism is inherently a temporary system, because it is based on decentralizes, yet has a tendency to very gradually centralize the more time progresses. If a person argues that a centralized society would inherently be "impossible," but does not address the point regarding capitalism's tendency to centralize, then this does not defeat Marxism. It only leads into a contradiction, where capitalism will inherently devolve into an "impossible" economy, one that in their mind would be very irrational and inefficient, albeit still inevitable.
I said I would cut Mises some slack, but not entirely. We cannot see things that are microscopic with the naked eye by definition. But we can still see them using a microscope, using a tool. Marx did not predict the modern computer, either, but he understood that as enterprises on the market continually scale and innovate, they are continually solving these problems. They are continually finding new ways to collect necessary information, and to compute it, in order to plan out the production of even larger and larger enterprises. Marx did not predict the modern computer exactly, but it inevitably falls out of his understanding that the capitalists will, at some point, develop a tool to enhance computation. Mises could not imagine this, he could not see beyond his nose.
Mises also makes it clear that his argument only applies to a fully planned economy. For example, he says an economy with some public planning could still be functional because public enterprise would still by and sell on the market, it would be an "oasis" of planning surrounded by markets which it could use to for reference.
[T]he extent to which socialism is in evidence among us constitutes only a socialistic oasis in a society with monetary exchange, which is still a free society to a certain degree. In one sense we may agree with the socialists’ assertion which is otherwise entirely untenable and advanced only as a demagogic point, to the effect that the nationalization and municipalization of enterprise is not really socialism, since these concerns in their business organizations are so much dependent upon the environing economic system with its free commerce that they cannot be said to partake today of the really essential nature of a socialist economy.
This, however, leaves a huge open question which he never addresses. If he admits some planning is possible, then when exactly is the threshold for when it becomes impossible? This is not a trivial point as Marxists have never believed in "pure" economies in the first place but have always accepted all economies have internal contradictions within themselves, i.e. a socialist economy can have markets, this has long been accepted by every major Marxist author. Even Stalin, who went the furthest with economic planning, still did not go fully, maintaining a level of markets in the "kolkhoz" sector and in his Economic Problems of Socialism in the USSR argue that maintaining a level of markets was useful because they allowed a reference for rational economic calculation.
If one does not demonstrate the threshold between planning and markets, even if they successfully prove that a purely planned economy would be impossible (which Mises comically fails to do so with his appeals to the limited computational power of "the human mind"), they have failed to demonstrate socialism is impossible, nor have they failed to demonstrate that capitalism will not eventually give way to a society where public control reigns supreme over the interests of profits. All they have shown is that this society would not be able to exist in a pure form.
In reality, thus, Mises' argument really only addresses a very particular kind of socialist, those who advocate for implementing a fully planned economy in its entire in the the present era. Well, not even the present era, but in the early 20th century, prior to the invention of the modern computer, where all computations would be carried out solely by "the human mind."
This is thus rather disconnected from, for example, Chinese Marxist orthodoxy, which is the most prevalent today. This would mean any Chinese Marxist of its orthodoxy who reads this book would find that it is not even really relevant.
Ultimately, this book is outdated, as nobody is arguing for computation of the entire economy with "the human mind," as it is well understood by advocates of this that thus a thing would be carried out using tools for computation, particularly computers. In fact, it's already largely being done, computers are heavily integrated into pretty much every large-scale enterprise in order to plan its operations, and enterprises would not have been able to efficiently scale up to the size the behemoths they are today without these tools. I'm also not sure what is with the reference to "a single human mind", as nobody ever argued a single person, even back in the 20th century, would plan the whole economy alone.
Not only is the book outdated, but it's not entirely relevant as a rebuttal to Marxists. It is only relevant to a small subsection of socialist who want to implement a fully planned economy right now. They could easily just rebut this entire book, though, by pointing to the existence of computers.
Hence, no one in the 21st century should unironically use this book as an argument. Even against its intended target it is outdated for the current century. Any book that actually wants to attack Marxism has to: (1) take into consideration that computational power will gradually improve over time and is not constant (something Mises failed to do, as he imagined computation forever would be carried out by the "human mind"), and (2) establish the threshold on which this will render further planning unfeasible. This book establishes neither of these things.
July 29, 2016
Mises' 1920 article "Die Wirtschaftsrechnung im sozialistischen Gemeinwesen" dismantled the economic tenets of socialism so efficiently that even Oskar Lange was compelled to suggest:
"... as an expression of recognition for the great service rendered by him and as a memento of the prime importance of sound economic accounting, a statue of Professor Mises ought to occupy an honorable place in the great hall of the Ministry of Socialization or of the Central Planning Board of the socialist state."
I'm not certain as to whether or not he was flattered by the prospect of having his marble bust featured in a soviet-polish vestibule, but I do know the following:
(1) Socialism rejects the notion of privately owned modes of production and replaces it with a public or nationalized version.
(2) This necessarily disrupts the intricate monetary calculations that are vital for connecting production goods of a 'higher order' and consumption goods of a 'lower order' in a market economy.
(3) The price mechanism, normally acting as distributed signal of supply and demand among market participants, is abandoned and thereafter replaced by the arbitrary guesses of a central committee about the quantity of goods, rates of production, prices, etc.
(4) Rational economic calculation becomes impossible as the capital structure of the economy is destroyed.
(5) The vital role of entrepreneurs in reducing costs of production through technological progression is completely nullified as the market environment becomes perverse for risk-takers.
(6) Shortages of goods, excessive waste, and misallocated resources become ubiquitous as the economy grinds to a halt.
This is the natural and only result possible when forcefully substituting the "egalitarian" principle of socialized modes of production for privatized modes of production based in voluntary exchange and self-interest. See the Soviet Bloc, Venezuela now, and certain EU countries in the coming years as examples.
Last but not least, my favorite quote from the book:
"They have criticized freely enough the economic structure of 'free' society, but have consistently neglected to apply to the economics of the disputed socialist state the same caustic acumen, which they have revealed elsewhere, not always with success. Economics, as such, figures all too sparsely in the glamorous pictures painted by the Utopians. They invariably explain how, in the cloud-cuckoo lands of their fancy, roast pigeons will in some way fly into the mouths of the comrades, but they omit to show how this miracle is to take place."
4.5 stars out of 5.
"... as an expression of recognition for the great service rendered by him and as a memento of the prime importance of sound economic accounting, a statue of Professor Mises ought to occupy an honorable place in the great hall of the Ministry of Socialization or of the Central Planning Board of the socialist state."
I'm not certain as to whether or not he was flattered by the prospect of having his marble bust featured in a soviet-polish vestibule, but I do know the following:
(1) Socialism rejects the notion of privately owned modes of production and replaces it with a public or nationalized version.
(2) This necessarily disrupts the intricate monetary calculations that are vital for connecting production goods of a 'higher order' and consumption goods of a 'lower order' in a market economy.
(3) The price mechanism, normally acting as distributed signal of supply and demand among market participants, is abandoned and thereafter replaced by the arbitrary guesses of a central committee about the quantity of goods, rates of production, prices, etc.
(4) Rational economic calculation becomes impossible as the capital structure of the economy is destroyed.
(5) The vital role of entrepreneurs in reducing costs of production through technological progression is completely nullified as the market environment becomes perverse for risk-takers.
(6) Shortages of goods, excessive waste, and misallocated resources become ubiquitous as the economy grinds to a halt.
This is the natural and only result possible when forcefully substituting the "egalitarian" principle of socialized modes of production for privatized modes of production based in voluntary exchange and self-interest. See the Soviet Bloc, Venezuela now, and certain EU countries in the coming years as examples.
Last but not least, my favorite quote from the book:
"They have criticized freely enough the economic structure of 'free' society, but have consistently neglected to apply to the economics of the disputed socialist state the same caustic acumen, which they have revealed elsewhere, not always with success. Economics, as such, figures all too sparsely in the glamorous pictures painted by the Utopians. They invariably explain how, in the cloud-cuckoo lands of their fancy, roast pigeons will in some way fly into the mouths of the comrades, but they omit to show how this miracle is to take place."
4.5 stars out of 5.
September 30, 2011
A small, efficient tome readily accessible to anyone with a little bit of patience - enough to put the book down and think every once in a while - as to why socialist economics is, ultimately, oxymoronic. If anything von Mises has been vindicated with the fullness of time in this, as stories of GOSPLAN fixing prices to Sears catalogs and North Korea pricing food in its restaurants wildly can attest.
July 11, 2020
This book is THE argument against socialism: Written in 1920, this paper-book is an elaboration of the idea of economic calculation and the necessity of a quantitative framework in which to calculate profit and loss as well as whether the goal has been met using the right amount of raw materials, time, capital, labour, and the other requirements of production. Then the book also expands on the Marxist theory of the labour-price of goods and the fallacy it is built on based on Bohm-Bawerck's seminal work, Capital and Interest.
The book is not an easy read. It's quite tough to understand, but understanding it is very rewarding. Not only is calculation necessary for an economy. It is necessary for society as well. One cannot imagine a functional society living hand-to-mouth as it leaves no room for any of life's higher and more sophisticated tasks. And without sound money, capital, as well as property and soon over dignity and wellbeing soon erode, as waste and thrift dissipate all that was built for ages past.
The book cautions us and tells us to compare ourselves between what we are today and what we were perhaps 20,000 years ago: The main difference is not really technology or citizenship, but a culture of respect between other human beings based on respect and cooperation, as well as the capital accumulated to form all the structures, the welfare, the surplus of food and drink and shelter that would leave more time on our hands for more thought and less misery and toil in satisfaction of immediate and urgent physical needs.
Socialism destroys itself because of its many inefficiencies, both economic (many +sum transactions don't happen because of regulations) and material (constant dissipation of capital goods, money, and private property). Socialism, in its end to end inequality, removes private property, sound money, and capital from the hands of the people to the hands of the public—but here, Mises reminds us that the public has to relegate to the elect (not necessarily cloistered) to work on the public good, which the elect ultimately will make utmost use for themselves. But suppose we only appoint saints who always try to do what's good for society? It is this polished argument which Mises attacks by reviewing the process of economic calculation and its impossibility in a socialist society.
I highly recommend reading Joseph Salerno's helpful afterword to this amazing and edifying pamphlet.
The book is not an easy read. It's quite tough to understand, but understanding it is very rewarding. Not only is calculation necessary for an economy. It is necessary for society as well. One cannot imagine a functional society living hand-to-mouth as it leaves no room for any of life's higher and more sophisticated tasks. And without sound money, capital, as well as property and soon over dignity and wellbeing soon erode, as waste and thrift dissipate all that was built for ages past.
The book cautions us and tells us to compare ourselves between what we are today and what we were perhaps 20,000 years ago: The main difference is not really technology or citizenship, but a culture of respect between other human beings based on respect and cooperation, as well as the capital accumulated to form all the structures, the welfare, the surplus of food and drink and shelter that would leave more time on our hands for more thought and less misery and toil in satisfaction of immediate and urgent physical needs.
Socialism destroys itself because of its many inefficiencies, both economic (many +sum transactions don't happen because of regulations) and material (constant dissipation of capital goods, money, and private property). Socialism, in its end to end inequality, removes private property, sound money, and capital from the hands of the people to the hands of the public—but here, Mises reminds us that the public has to relegate to the elect (not necessarily cloistered) to work on the public good, which the elect ultimately will make utmost use for themselves. But suppose we only appoint saints who always try to do what's good for society? It is this polished argument which Mises attacks by reviewing the process of economic calculation and its impossibility in a socialist society.
I highly recommend reading Joseph Salerno's helpful afterword to this amazing and edifying pamphlet.
December 13, 2020
I've never been a fan of Mises, but this essay, first published in 1920, is perhaps his most solid contribution to the social sciences. It started a debate that went on for 50 years, and was surpassed only in the 1970s thanks to the research in mechanism design theory.
Mises' argument was expanded by Hayek in the 1930s, and it even influenced his fundamental 1945 essay The Use of Knowledge in Society, which made even deeper considerations. The two essays together highlighted some basic problems laying at the very core of the centralized planning idea that are ultimately impossible to solve within that paradigm.
Mises' argument was expanded by Hayek in the 1930s, and it even influenced his fundamental 1945 essay The Use of Knowledge in Society, which made even deeper considerations. The two essays together highlighted some basic problems laying at the very core of the centralized planning idea that are ultimately impossible to solve within that paradigm.
June 7, 2017
Very dry and technical, but that was to be expected due to the subject matter and the fact that the intended audience were professional economists. This is some extremely dense stuff, but if you want to understand Mises' calculation-argument - truly understand it - then reading this is how you go about it. It's not Hayeks knowledge-argument in a different form, the two aren't even as closely related as you would think. Mises argues that even if a central planner did have perfect knowledge of the individual valuations of consumer goods by everyone in the world, he would have no basis for economic calculation. Production goods of a higher order (those that are farther removed from the final consumption good) could then not be allocated rationally. A socialist economy can only work when it still has prices to operate with, either from its own past (which naturally stands in the way of any progress at all) or by capitalist neighbors as in the case of the USSR and similar countries, or when it fully succumbs to primitivism and stops using production goods of a higher order. This is very interesting information to keep in mind when reading A Socialist Empire: The Incas of Peru, a book for which Mises even wrote the foreword.
The editors notes in this edition are excellent, by the way. They really help with the understanding, and include some additional information on how Hayeks and Mises' theories relate to each other and how the latters argument has been misunderstood by economists of all schools, from socialists to fellow Austrians.
The editors notes in this edition are excellent, by the way. They really help with the understanding, and include some additional information on how Hayeks and Mises' theories relate to each other and how the latters argument has been misunderstood by economists of all schools, from socialists to fellow Austrians.
June 25, 2016
Brandon's review is a great explanation of what this essay is about, namely that Socialism fails because it is impossible for central planners to make rational decisions about the economy.
I find it stunning that the key failure of Socialism was so clearly identified a century ago, really before it even got started in practice. Mises must have been a truly brilliant thinker to be able to see through the hype and succinctly summarize the critical issue. If people would have listened to him, a lot of pain and suffering would have been avoided.
The most crude explanation I've heard of why the Soviet Union collapsed from within is that the economy finally failed to produce enough toilet paper for everyone. I can certainly understand why that pushed things over the edge!
I find it stunning that the key failure of Socialism was so clearly identified a century ago, really before it even got started in practice. Mises must have been a truly brilliant thinker to be able to see through the hype and succinctly summarize the critical issue. If people would have listened to him, a lot of pain and suffering would have been avoided.
The most crude explanation I've heard of why the Soviet Union collapsed from within is that the economy finally failed to produce enough toilet paper for everyone. I can certainly understand why that pushed things over the edge!
March 3, 2022
Cualquiera que quiera entender el argumento de Mises debe leer este libro. Breve, conciso pero muy bueno. Deja bien claro porque en el socialismo no puede existir una economía racional, ni economía como tal.
April 11, 2020
A good overview of socialism from an economic perspective. I liked how he showed that socialism would eventually fall into a "capitalist" system because of the way socialistic monetary policies and exchange has been developed (or lack thereof). You would have to value everyone's hours put into the system differently since the person stocking shelves would have a lot easier hour than a lineman or engineer. If everyone's work was truly "equal" then everyone would be low level employees since there's no motivation to do more. Supply and demand would be adjusted slower and products would be valued differently. The example he used was of people wanting cigars or cigarettes. If someone gets a ration of cigarettes, but prefers cigars, they may trade with someone who prefers cigarettes. Then you have a new monetary system subverting the socialist system.
This helped give some basic and specific deficiencies in the socialist system and helps show just how completely incompatible with reality socialism is.
This helped give some basic and specific deficiencies in the socialist system and helps show just how completely incompatible with reality socialism is.
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February 19, 2022Mises Institute should release an updated scholarly edition now that Socialism with Chinese Characteristics has caused the displacement of the US as the world's richest nation. The essay briefly addresses the "market socialists" in their movement's infancy, but obviously no commentary on any "socialist market economy", as no such thing existed at the time and the distinction would've sounded nonsensical to any reasonable person.
June 16, 2020
This book was written in 1920.
July 2, 2025
This is the death blow to socialism. It’s how the Soviet Union ended up with chandeliers that fell on people’s heads and balconies that fell out from under their feet. No prices means no informed allocation, and no informed allocation means little production, and little production means poverty.
June 26, 2015
Great essay presenting arguments for the fact that in a planned economy there is no rational economic calculation. Any form of socialist planning is doomed to fail, because it is impossible to rationally plan production (how, what, when, where) without calculation based on the market price system and profits. Through this socialism will always be much less effective than free-market economy. I would recommend this essay to anyone. It is also worth to reach for Human Action written by Ludwig von Mises. In that book Mises ebunks attacks of socialists and provides new arguments for his statement.
//polish
Świetny esej przedstawiający argumenty za tym, że w gospodarce planowanej nie istnieje racjonalna kalkulacja ekonomiczna. Każda forma socjalistycznego planowania jest skazana na porażkę, ponieważ nie da się w racjonalny sposób rozplanować produkcji(ile, czego, kiedy, gdzie) bez kalkulacji opartej o rynkowy system cen i zysk. Przez to socjalizm zawsze będzie znacznie mniej efektywny niż gospodarka wolnorynkowa. Polecam tej esej każdemu. Warto też sięgnąć po Ludzkie Działanie Ludwiga von Misesa. W tamtym dziele Mises odbija ataki socjalistów i dostarcza nowych argumentów za swoim stwierdzeniem.
//polish
Świetny esej przedstawiający argumenty za tym, że w gospodarce planowanej nie istnieje racjonalna kalkulacja ekonomiczna. Każda forma socjalistycznego planowania jest skazana na porażkę, ponieważ nie da się w racjonalny sposób rozplanować produkcji(ile, czego, kiedy, gdzie) bez kalkulacji opartej o rynkowy system cen i zysk. Przez to socjalizm zawsze będzie znacznie mniej efektywny niż gospodarka wolnorynkowa. Polecam tej esej każdemu. Warto też sięgnąć po Ludzkie Działanie Ludwiga von Misesa. W tamtym dziele Mises odbija ataki socjalistów i dostarcza nowych argumentów za swoim stwierdzeniem.
January 17, 2013
A short but indispensable essay on the absolute failure of the State when it comes and tries to intervene, "fix" or organize. The Eastern Bloc failed long time ago and collapsed for everyone to see, yet there remain many people wishing for Socialist implementations of all sorts (the ecologists perhabps the more active nowadays, but by no means the only ones). These people should read this and try to understand, neither of which they will do, since Socialism much resembles a religion (as Freud presciently said long ago). This booklet shows how and why Socialism failed and will always do.
July 8, 2021
This is without a doubt, the strongest, and most concise argument against socialism. Written in 1920, Mises is still more relevant than ever. The excellent epilogue by Joe Salerno demonstrates how the Misesian economic calculation argument can be applied not just to socialism, but to any form of economic interventionism.
The only disappointment is knowing that this work has been misunderstood and ignored on a massive scale. You might win the argument, but that doesn't mean anyone was listening; and if no one is listening, did you really win?
The only disappointment is knowing that this work has been misunderstood and ignored on a massive scale. You might win the argument, but that doesn't mean anyone was listening; and if no one is listening, did you really win?
January 17, 2009
Not a book for beginners. I give it 4 stars instead of 5 because Solerno is able to present all the information in this book in a manner that is less headache inducing.
The argument is well presented and the logic is rock solid, it did however take me reading this twice to grasp the entire argument.
A good book for those who already have a basic concept of economics and economic thought.
The argument is well presented and the logic is rock solid, it did however take me reading this twice to grasp the entire argument.
A good book for those who already have a basic concept of economics and economic thought.
April 30, 2022
Ever had a socialist argue about the virtues of planned economy? Mises destroyed them more than a century ago. 'But these days with the advance in AI we can have much more efficient planned economy!' cries the socialist. 'No, you can't' says Mises from 1920 and destroys their argument despite never having heard of an AI.
November 5, 2020
This is, perhaps, one of the most intellectually aggressive arguments against economic regulation I’ve encountered.
July 29, 2021
Amazing book, devastating critique of planning and allocation with lack of markets
November 27, 2023
"Economic Calculation in the Socialist Commonwealth" is a seminal work by the Austrian economist Ludwig von Mises, originally published in 1920. The book addresses a fundamental critique of socialist economic planning, particularly focusing on the challenges inherent in the absence of a genuine price mechanism under socialism.
Mises begins by highlighting the role of prices in a market economy as signals that convey crucial information about the relative scarcity of resources and consumer preferences. In a capitalist system, prices are determined through the interaction of supply and demand, reflecting the opportunity costs and values assigned by individuals in their decision-making processes. However, Mises argues that socialism, which advocates for collective ownership of the means of production, lacks a genuine price system due to the absence of private property and market exchanges.
The absence of private ownership and competitive markets in a socialist system, according to Mises, hinders the allocation of resources in an efficient and rational manner. Without market prices to guide decision-making, socialist planners face insurmountable challenges in determining the most beneficial use of resources, coordinating production, and responding to changes in consumer preferences. Mises contends that without a price mechanism, rational economic calculation becomes impossible, leading to inefficiency, waste, and misallocation of resources.
Mises also addresses the notion of a planned economy, arguing that central planning cannot replicate the dynamic and decentralized nature of a market system. He emphasizes the inability of central planners to possess the necessary information to make informed decisions about resource allocation, production levels, and distribution. The complexity of the modern economy, Mises argues, requires decentralized decision-making based on the knowledge dispersed among individuals and entrepreneurs in the market.
In conclusion, "Economic Calculation in the Socialist Commonwealth" is a foundational work that challenges the feasibility of socialist economic planning. Mises argues that the lack of a genuine price mechanism under socialism results in a failure to effectively allocate resources, coordinate production, and respond to consumer preferences. The book remains a classic in the critique of central planning and continues to be influential in discussions about the role of markets in promoting economic efficiency and prosperity.
Mises begins by highlighting the role of prices in a market economy as signals that convey crucial information about the relative scarcity of resources and consumer preferences. In a capitalist system, prices are determined through the interaction of supply and demand, reflecting the opportunity costs and values assigned by individuals in their decision-making processes. However, Mises argues that socialism, which advocates for collective ownership of the means of production, lacks a genuine price system due to the absence of private property and market exchanges.
The absence of private ownership and competitive markets in a socialist system, according to Mises, hinders the allocation of resources in an efficient and rational manner. Without market prices to guide decision-making, socialist planners face insurmountable challenges in determining the most beneficial use of resources, coordinating production, and responding to changes in consumer preferences. Mises contends that without a price mechanism, rational economic calculation becomes impossible, leading to inefficiency, waste, and misallocation of resources.
Mises also addresses the notion of a planned economy, arguing that central planning cannot replicate the dynamic and decentralized nature of a market system. He emphasizes the inability of central planners to possess the necessary information to make informed decisions about resource allocation, production levels, and distribution. The complexity of the modern economy, Mises argues, requires decentralized decision-making based on the knowledge dispersed among individuals and entrepreneurs in the market.
In conclusion, "Economic Calculation in the Socialist Commonwealth" is a foundational work that challenges the feasibility of socialist economic planning. Mises argues that the lack of a genuine price mechanism under socialism results in a failure to effectively allocate resources, coordinate production, and respond to consumer preferences. The book remains a classic in the critique of central planning and continues to be influential in discussions about the role of markets in promoting economic efficiency and prosperity.
July 24, 2019
Mises descreve brevemente nesse livro alguns problemas relativos ao Cálculo Econômico no Socialismo.
Quem vai escolher o uso dos bens de consumo, e sob qual critério? No socialismo pode haver trocas do que for distribuído para eles, mas são apenas bens de consumo.
O cálculo monetário será impossível. Os camaradas precisarão levar em conta as proporções dos desejos das pessoas nos mínimos detalhes e quantidades, tentando a todo tempo precificar essas preferências.
O valor-trabalho para resolver esse problema é ridículo, trocando diretamente horas de trabalho pelos bens de preferência, como se os trabalhos fossem uniformes, retornando ao problema das preferências das pessoas. Ex: uma hora de um artista não vale uma hora do trabalho mais simples possível.
Não há parâmetros para mensurar lucratividade de métodos de produção, de produtividade da mão de obra. Seria necessário haver uma tabela geral de emprego de mão de obra para cada atividade, como dito por Engels, uma piada.
Há o problema da livre iniciativa e responsabilidade individual nas empresas comunais, visto que não há nenhum incentivo para que isso exista. As empresas estatais só não acabam logo de cara pois se adaptam à realidade das demais empresas privadas que interagem entre si, notando que as empresas estatais são infinitamente mais engessadas e fracassadas.
Lembra que Marx parte do pressuposto de que não haverá conflito entre o interesse coletivo e o individual. Critica a superficialidade de Otto Bauer em posições como a estatização dos bancos, em que Bauer sequer define o que é um banco. Também despreza a ignorância de Lenin em relação à Estatística.
Depois de ter lido o livro do Jesus Huerta de Soto, este livro ficou até sem graça.
Quem vai escolher o uso dos bens de consumo, e sob qual critério? No socialismo pode haver trocas do que for distribuído para eles, mas são apenas bens de consumo.
O cálculo monetário será impossível. Os camaradas precisarão levar em conta as proporções dos desejos das pessoas nos mínimos detalhes e quantidades, tentando a todo tempo precificar essas preferências.
O valor-trabalho para resolver esse problema é ridículo, trocando diretamente horas de trabalho pelos bens de preferência, como se os trabalhos fossem uniformes, retornando ao problema das preferências das pessoas. Ex: uma hora de um artista não vale uma hora do trabalho mais simples possível.
Não há parâmetros para mensurar lucratividade de métodos de produção, de produtividade da mão de obra. Seria necessário haver uma tabela geral de emprego de mão de obra para cada atividade, como dito por Engels, uma piada.
Há o problema da livre iniciativa e responsabilidade individual nas empresas comunais, visto que não há nenhum incentivo para que isso exista. As empresas estatais só não acabam logo de cara pois se adaptam à realidade das demais empresas privadas que interagem entre si, notando que as empresas estatais são infinitamente mais engessadas e fracassadas.
Lembra que Marx parte do pressuposto de que não haverá conflito entre o interesse coletivo e o individual. Critica a superficialidade de Otto Bauer em posições como a estatização dos bancos, em que Bauer sequer define o que é um banco. Também despreza a ignorância de Lenin em relação à Estatística.
Depois de ter lido o livro do Jesus Huerta de Soto, este livro ficou até sem graça.
September 29, 2021
"Where there is no free market, there is no pricing mechanism; without a pricing mechanism, there is no economic calculation."
It's a book that can claim to accurately forecast the problems and failings of socialism, and it drew attention to the "calculation problem" at the heart of it.
It's truly remarkable. Mises & Hayek were one of the only economists (certainly the most important ones) that set the debate from the position that socialism is impossible and stuck with it, where the vast majority of intellectuals either wanted socialism or did think it at least possible.
To be fair, the book probably fails to "proof" that socialism is impossible. The critics of the book in the 1920s-40s point at socialist models that don't abolish the price and exchange mechanism - and (semi-)socialist states are clearly "working". How good or bad, that's a different question.
Mises goes too far in claiming to irrefutably proof socialism can never work a priori.
What can certainly be said is that Mises pointed at probably the most significant problem that socialism is facing, that is at the heart of why capitalist economics works - the price mechanism.
It's a book that can claim to accurately forecast the problems and failings of socialism, and it drew attention to the "calculation problem" at the heart of it.
It's truly remarkable. Mises & Hayek were one of the only economists (certainly the most important ones) that set the debate from the position that socialism is impossible and stuck with it, where the vast majority of intellectuals either wanted socialism or did think it at least possible.
To be fair, the book probably fails to "proof" that socialism is impossible. The critics of the book in the 1920s-40s point at socialist models that don't abolish the price and exchange mechanism - and (semi-)socialist states are clearly "working". How good or bad, that's a different question.
Mises goes too far in claiming to irrefutably proof socialism can never work a priori.
What can certainly be said is that Mises pointed at probably the most significant problem that socialism is facing, that is at the heart of why capitalist economics works - the price mechanism.
September 5, 2021
This extended essay is a brilliant refutation of the "logic and practises" of socialist economics. It is especially valuable not only because there is a new fad in new socialism (my phrase) but because one sees very poorly uninformed critiques of economic freedom and capitalism even in countries with decently run economies. I don't intend to write a summary of the main arguments but my view is that this is an excellent piece for students of political economy and other people with opinions about the failures of existing systems of economic and social organization.
But the reason it merits a five-star rating in my world is that the arguments are cogent and the author was prescient. he boldly predicted the internal contradictions of socialist organization and he was borne right, fifty years later.
It requires patience to read because this is a translation from the German language and the sentence structure requires keenness. That stated, this isn't a fine piece of literature because of the facility with language but mostly for its plain logic and rigour in reasoning.
But the reason it merits a five-star rating in my world is that the arguments are cogent and the author was prescient. he boldly predicted the internal contradictions of socialist organization and he was borne right, fifty years later.
It requires patience to read because this is a translation from the German language and the sentence structure requires keenness. That stated, this isn't a fine piece of literature because of the facility with language but mostly for its plain logic and rigour in reasoning.
June 22, 2024
"The real character of the so-called centrally planned economy is well illustrated by a quip I heard several years ago by Soviet economist Nikolai Fedorenko. He said that a fully balanced, checked, and detailed economic plan for the next year would be ready, with the help of computers, in 30,000 years. There are millions of product variants; there are hundreds of thousands of enterprises; it is necessary to make billions of decisions on inputs and outputs; the plans must relate to labor force, material supplies, wages, costs, prices, “planned profits,” investments, transportation, storage, and distribution. These decisions originate from different parts of the planning hierarchy. They are, as a rule, inconsistent and contradictory to each other because they reflect the conflicting interests of different strata of bureaucracy. Because the next year’s plan must be ready by next year, and not in 29,999 years, it is inevitably neither balanced nor rational."
August 11, 2020
This book was written early in Mises’ career. Many of the arguments brought forward here are improved upon and expressed more eloquently and clearly in his magnum opus Human Action, but this essay is more expansive in content and yet more confined in length than his discussion on the socialist economy in Human Action. The only downside is that he had not completely decided on the proper use of some terms, and reading this after reading his later works where he is more fully developed makes it kind of confusing, but not impossible to follow. This could also be the fault of the translation. I have seen some bad translations from German. Overall, this is an important yet overlooked essay in the Socialist Calculation Debate, and everyone can gain something from this.
December 25, 2020
Technical book, for beginners in Economics
Mises' famous essay is technical and indicated only for those initiated in Economics.
In addition to the essay itself, the book has a preface and a postface that seek to assist the reader in understanding the work.
Even so, the work is not easy to understand and can frustrate the reader less versed in Economics.
------------------------------
PORTUGUÊS
Livro técnico, para iniciados em Economia
O célebre ensaio de Mises é técnico e indicado apenas para os iniciados em Economia.
Além do ensaio em si, o livro conta com prefácio e posfácio que buscam auxiliar o leitor na compreensão da obra.
Ainda assim, a obra não é de fácil entendimento e pode frustrar o leitor menos versado em Economia.
Mises' famous essay is technical and indicated only for those initiated in Economics.
In addition to the essay itself, the book has a preface and a postface that seek to assist the reader in understanding the work.
Even so, the work is not easy to understand and can frustrate the reader less versed in Economics.
------------------------------
PORTUGUÊS
Livro técnico, para iniciados em Economia
O célebre ensaio de Mises é técnico e indicado apenas para os iniciados em Economia.
Além do ensaio em si, o livro conta com prefácio e posfácio que buscam auxiliar o leitor na compreensão da obra.
Ainda assim, a obra não é de fácil entendimento e pode frustrar o leitor menos versado em Economia.
August 26, 2024
Świetny esej, który nie traci na aktualności. Mises świetnie ujął istotę kalkulacji oraz funkcji dynamicznie zmieniających się pieniężnych stosunków wymiany czynników produkcji w gospodarce. Do całości dorzuca krótkie, ale niesamowicie celne uwagi z zakresu teorii pieniądza oraz teorii wartości. Do eseju można i powinno się wracać wielokrotnie.
November 1, 2017
Um bom livro que trata sobre a impossibilidade do cálculo econômico sob o socialismo. O mais interessante é que Mises dá todas as vantagens para o modelo socialista e mesmo assim prova sua impossibilidade.
February 20, 2019
É interessante para quem gosta de economia. A argumentação do Mises é muito boa e fácil de seguir até para quem não possui graduação em economia, pois o autor não usa aqueles modelos econômicos que dependem excessivamente da matemática para fazer suas argumentações.
January 6, 2021
TL;DR: If the means of production are socialized, there is no voluntary exchange; and if there is no voluntary exchange, prices cannot be determined; and if prices cannot be determined, economic calculation is impossible. Are they even aware of this?
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