Ariane Fischer, David Woodruff, and Johanna Bockman have translated Karl Polanyi’s “Sozialistische Rechnungslegung” [“Socialist Accounting”] from 1922. In this article, Polanyi laid out his model of a future socialism, a world in which the economy is subordinated to society. Polanyi described the nature of this society and a kind of socialism that he would remain committed to his entire life. Accompanying the translation is the preface titled “Socialism and the embedded economy.” In the preface, Bockman explains the historical context of (...) the article and its significance to the socialist calculation debate, the social sciences, and socialism more broadly. Based on her reading of the accounting and society that Polanyi offers here, Bockman argues that scholars have too narrowly used Polanyi’s work to support the Keynesian welfare state to the exclusion of other institutions, have too broadly used his work to study social institutions indiscriminately, and have not recognized that his work shares fundamental commonalities with and often unacknowledged distinctions from neoclassical economics. (shrink)

The dissertation concerns F. A. Hayek’s critique of legislation. The purpose of the investigation is to clarify and assess that critique. I argue that there is in Hayek’s work a critique of legislation that is distinct from his well-known critique of social planning. Further that the main claim of this critique is what I refer to as Hayek’s legislation tenet, namely that legislation that aims to achieve specific aggregate results in complex orders of society will decrease the welfare level. The (...) legislation tenet gains support; from the welfare claim – according to which there is a positive correlation between the utilization of knowledge and the welfare level in society; from the dispersal of knowledge thesis – according to which the total knowledge of society is dispersed and not available to any one agency; and from the cultural evolution thesis – according to which evolutionary rules are more favorable to the utilization of knowledge in social cooperation than are legislative rules. More specifically, I argue that these form two lines of argument in support of the legislation tenet. One line of argument is based on the conjunction of the welfare claim and the dispersal of knowledge thesis. I argue that this line of argument is true. The other line of argument is based on the conjunction of the welfare claim and the cultural evolution thesis. I argue that this line of argument is false, mainly because the empirical work of political scientist Elinor Ostrom refutes it. Because the two lines of argument support the legislation tenet independently of each other, I argue that Hayek’s critique of legislation is true. In this dissertation, I further develop a legislative policy tool as based on the welfare claim and Hayek’s conception of coercion. I also consider Hayek’s idea that rules and law are instrumental in forging rational individual action and rational social orders, and turn to review this idea in light of the work of experimental economist Vernon Smith and economic historian Avner Greif. I find that Smith and Greif support this idea of Hayek’s, and I conjecture that it contributes to our understanding of Adam Smith’s notion of the invisible hand: It is rules – not an invisible hand – that prompt subjects to align individual and aggregate rationality in social interaction. Finally, I argue that Hayek’s critique is essentially utilitarian, as it is concerned with the negative welfare consequences of certain forms of legislation. And although it may appear that the dispersal of knowledge thesis will undermine the possibility of carrying out the utilitarian calculus, due to the lack of knowledge of the consequences of one’s actions – and therefore undermine the legislation tenet itself – I argue that the distinction between utilitarianism conceived as a method of deliberation and utilitarianism conceived as a criterion of correctness may be used to save Hayek’s critique from this objection. (shrink)

Hayek developed two contradictory epistemologies. The epistemology for which he is famous attributed dispersed knowledge to economic actors and credited the price system for aggregating and communicating this knowledge. The other epistemology attributed to human and non-human organisms alike the error-prone interpretation of stimuli, which could never truly be said to be “knowledge.” Several of the paradoxes of Hayek's economic and political thought that are explored in this symposium can be explained by the triumph of the first epistemology over the (...) second, including his historical interpretation of socialism as a planning mentality; his tendentious definitions of “liberty” and “justice”; and his opposition to economic redistribution even as he endorsed all manner of economic and social regulations. (shrink)

In the 1920s, Ludwig von Mises argued correctly that the problem of making economic calculations without market‐generated prices would be an insuperable difficulty for socialist systems of production. Bryan Caplan is right to argue that there is no theoretical way to infer the magnitude of this difficulty, but he is wrong to insist that the history of poor economic performance displayed by real‐world socialism should be attributed not to the “socialist calculation problem,” but to inadequate work incentives. A state that (...) had solved the calculation problem would have well within its means the solution to the incentives problem, too. (shrink)

The dominant practice of AI alignment assumes (1) that preferences are an adequate representation of human values, (2) that human rationality can be understood in terms of maximizing the satisfaction of preferences, and (3) that AI systems should be aligned with the preferences of one or more humans to ensure that they behave safely and in accordance with our values. Whether implicitly followed or explicitly endorsed, these commitments constitute what we term apreferentistapproach to AI alignment. In this paper, we characterize (...) and challenge the preferentist approach, describing conceptual and technical alternatives that are ripe for further research. We first survey the limits of rational choice theory as a descriptive model, explaining how preferences fail to capture the thick semantic content of human values, and how utility representations neglect the possible incommensurability of those values. We then critique the normativity of expected utility theory (EUT) for humans and AI, drawing upon arguments showing how rational agents need not comply with EUT, while highlighting how EUT is silent on which preferences are normatively acceptable. Finally, we argue that these limitations motivate a reframing of the targets of AI alignment: Instead of alignment with the preferences of a human user, developer, or humanity-writ-large, AI systems should be aligned with normative standards appropriate to their social roles, such as the role of a general-purpose assistant. Furthermore, these standards should be negotiated and agreed upon by all relevant stakeholders. On this alternative conception of alignment, a multiplicity of AI systems will be able to serve diverse ends, aligned with normative standards that promote mutual benefit and limit harm despite our plural and divergent values. (shrink)

How should we conceive of policymakers for the purposes of political analysis? In particular, if we wish to explain and predict political decisions and their consequences, if we wish to ensure that political action is as effective as it can be, how should we think of policymakers? Should we think of them as they are commonly conceived in traditional political analysis, i.e., as uniquely knowledgeable and as either altruistic (i.e., as motivated to realize goals associated with their constituents’ interests) or (...) knavish (i.e., as motivated to realize goals associated with their own personal interests), or should we treat them as possibly ignorant with respect to their political tasks? -/- It is always an open question whether policymakers possess the knowledge required to realize some policy objective. It should never be assumed a priori that policymaker knowledge is adequate to the policy tasks with which policymakers are charged. Politicians need knowledge concerning the causes of social phenomena adequate to control events sufficiently well to ensure the success of their policies. No argument has ever been offered for the standard, if only implicit, assumption that policymakers, somehow automatically, possess this knowledge. In many contexts, there is no reason to believe that policymakers possess or can acquire this knowledge. Indeed, a bit of reflection reveals how unlikely it is that and how rare the circumstances must be in which policymakers meet this condition, which political philosophers, theorists, economists, and other political thinkers have traditionally assumed as a matter of course. -/- The main purpose of the book is to encourage a conversation among scholars and students of political inquiry (in philosophy and political theory, political science, economics and political economy) concerning the best way to conceive of policymakers for the purposes of such inquiry. -/- The book defends an alternative, more realistic, method of political analysis. The book argues against the false assumption that policymakers are epistemically privileged. The book presents and defends the alternative assumption that, with respect to the knowledge required to discharge their political tasks effectively, policymakers are at least as ignorant as constituents. -/- The book further argues that whether policymakers are altruistic or knavish is, in the first instance, a function of the nature and extent of their ignorance with regard to constituent-minded policy goals. Policymakers who possess the knowledge required to be effectively altruistic are more likely to be altruistic, other things the same, than policymakers who are ignorant of the knowledge that successful altruism requires. -/- This being said, my goal is more to leave readers thinking about and inclined to debate these profound issues than to prescribe a particular methodological conclusion (even less to advocate a particular political conclusion). The book is a heuristic for spurring further conversation. It makes of readers fellow interlocutors partnered with the characters (and the author!) of the dialogue. -/- The vehicle for this analysis is a conversation between four friends, philosophy graduate students, with different interests, different levels and kinds of experience, and different political preferences. The four friends consider how politicians should be conceived for the purposes of analyzing political decision-making and its consequences. -/- In his famous Dialogues concerning Natural Religion, David Hume concluded that the assumption of an all-knowing and all-powerful God was neither necessary nor sufficient to explain natural phenomena. Dialogues concerning Natural Politics does for social science what Hume did for natural science. Both books undermine the assumption that some epistemically privileged being – God in the case of natural phenomena and God-like politicians in the case of social phenomena – must be invoked to explain relevant phenomena. (shrink)

Are workers dominated? A recent suite of neo-republican and relational egalitarian philosophers think they are. Suppose they are right; that is, suppose that some workers are governed by an unjust and arbitrary power existing in labour relations, which persists even in the presence of the actual ability to exit. My question is this: does that give us reason to impose restrictions on firms? According to the so-called Efficiency Objection there are relevant trade-offs that need to be considered between the efficiency (...) of firms and the freedom of workers, and upon considering these trade-offs, we should reject workplace democracy. In this paper, I present a dilemma for the Efficiency Objection. I argue that either the Efficiency Objection is justified on moral grounds or non-moral grounds; if the Efficiency Objection is justified on moral grounds, then it fails because efficiency cannot be valued for its own sake (it is only instrumentally good); if the Efficiency Objection is justified on non-moral grounds, then it fails because of the respect that we owe to persons as persons; therefore, the Efficiency Objection fails. (shrink)

The thesis provides a philosophically grounded account of a socialist planned economy. While I do not primarily consider a positive case for socialism, I address two major objections to it and thus argue that the possibility of socialism as an alternative form of economic organisation has been dismissed too quickly. Furthermore, I provide an account of the precise form a socialist economy should take, outlining general principles of planning and distribution. Based on a welfarist interpretation of Marx, I show that (...) distribution of consumer goods should be facilitated by an equal distribution of tokens. These tokens can be redeemed for consumer products or substituted for additional leisure time. The rates at which tokens can be redeemed for consumer products should correspond to market clearing prices. Welfare-oriented socialism is also defended against a deontological objection to socialism by Robert Nozick, who claims that socialism leads to injustice because it violates private property rights. The thesis also considers Ludwig von Mises’s calculation argument against socialism, which claims that socialism leads to the abolition of economic rationality. I show how this objection can be overcome by using optimal planning techniques which are responsive to consumer demand as signalled by the market clearing rates of consumer products. The resulting model of socialism is tested using a computer simulation. The simulation also demonstrates that a novel system of valuation based on opportunity cost leads to a better adaptation of production in response to environmental constraints when compared to the labour values of classical political economy. (shrink)

According to G.A. Cohen, the principles of justice are insensitive to facts about human moral limitations. This assumption allows him to mount a powerful defense of socialism. Here, I present a dilemma for Cohen. On the one hand, if such socialism is to be realized through collective property ownership, then the information problem renders the ideal incoherent, not merely infeasible. On the other hand, if socialism is to incorporate private ownership of productive assets, then Cohen loses the resources to distinguish (...) his view from capitalism. For, if agents were ideally motivated, there would be no need for coercive taxation schemes and limitations on trade. Moreover, incorporating coercion drastically undermines Cohen’s original argument for socialism, which relies on an analogy to a camping trip among friends. (shrink)

One of the distinctive features of the Austrian School of Economics has been its emphasis on the entrepreneur as central to the market process. One 20th century Austrian whose work is normally not thought of as making a major contribution to the Austrian theory of entrepreneurship is Ludwig Lachmann. However, a careful reading of his 1956 book Capital and its Structure can tease out a theory of the function of the entrepreneur that is distinctly different from that of Israel Kirzner, (...) yet still clearly situated in an Austrian conception of the market process. In this contribution, I want to emphasize two points that have been raised by previous work on Lachmann, but not explored in any detail. The first is that Lachmann’s conception of entrepreneurship is deeply bound up with the need to engage in monetary calculation thanks to the heterogeneity of capital and uncertainty of the future. For Lachmann, the key function of the entrepreneur is to “specify” the uses of capital goods. Such specification requires the use of money prices and what Mises called monetary calculation. The second contribution is to offer more detail on the way in which entrepreneurs both creatively specify and re-specify the uses of their capital goods in response to profit and loss signals. The constant shuffling and reshuffling of capital goods, of which coming up with new products or new twists to old ones are a part, is the essence of Lachmann’s implicit vision of entrepreneurship. For Lachmann, entrepreneurship is bound up with resource ownership and deployment through the creation and revision of plans in ways that are much more active than Kirzner’s conception of the entrepreneur. (shrink)

A legal system is any institution or set of institutions in a given society that provides dispute resolution in a systematic and reasonably predictable way. it does so through the exercise of three functions: the judicial, the legislative, and the executive. The judicial function, the adjudication of disputes, is the core of any legal system; the other two are ancillary to this. The legislative function is to determine the rules that will govern the process of adjudication (this function may be (...) merged with the judicial function, as when case law arises through precedents, or it may be exercised separately), while the executive function is to secure submission (through a variety of means, which may or may not include violence) to the adjudicative process and compliance with its verdicts. A government or state (for present purposes i shall use these terms interchangeably) is any organisation that claims, and in large part achieves, a forcibly maintained monopoly, within a given geographical territory, of these legal functions, and in particular of the use of force in the executive function. now the market anarchist objection to government is simply a logical extension of the standard libertarian objection to coercive monopolies in general.1 First, from a moral point of view, among people regarded as equals2 it cannot be legitimate for some to claim a certain line of work as their own privileged preserve from which others are to be forcibly excluded; we no longer believe in the divine right of kings, and on no other basis could such inequality of rights be justified. Second, from an economic point of view, because monopolies are insulated from market competition and hold their customers by force, they lack both the information and the incentive to provide consumers with fair, efficient, and inexpensive service. The anarchist accepts these arguments, and merely asks why they should apply with any less force to the provision of legal services. (shrink)

Boettke and Butkevich argue that a vibrant society is an entrepreneurial society. Entrepreneur- ial effectiveness is a function of the free movement of economic actions – their alertness to opportunities for mutual gain, and their sense of when and where to enter and exit a market. Boettke and Butkevich focus not so much on the behavior of entrepreneurship, but the institutional conditions within which entrepreneurship takes place. They argue that policies which hinder the above ground legitimate expression of entrepreneurial discovery (...) must be eliminated for the further development of the Russian economy towards a market system and away from the current “virtual economy”. Institutions of governance must be established which reduce political uncertainty and encourage individuals to be willing to bet on their ideas and find the financing to bring those bets to life.Boettke et Butkevich suggèrent que l’activité entrepreneuriale est la force motrice d’une société. L’efficacité de l’activité entrepreneuriale dépend de la libre circulation des acteurs économiques – leur vigilance à l’égard des opportunités de gains mutuels, et leur jugement concernant les moment et lieu opportuns pour entrer sur un marché ou en sortir. Les auteurs mettent l’accent, pas tant sur le comportement des entrepreneurs, que sur les aménagements institutionnels à l’intérieur desquels l’activité entrepreneuriale a lieu. Ils considèrent que les politiques qui font obstacle aux manifestations légitimes de découverte entrepreneuriale doivent être éliminées pour accompagner le développement de l’économie russe vers une économie de marché, distincte de l’actuelle “économie virtuelle”. Des institutions de gouvernance qui réduisent l’incertitude politique doivent être établies. Ces institutions devraient aussi encourager les individus à parier sur leurs idées et à trouver des sources de financement pour instaurer ces idées. (shrink)

In the final parts of Piketty’s Capital and Ideology, he presents his vision for a just and more equal society. This vision marks an alternative to contemporary societies, and differs radically both from the planned Soviet economies and from social democratic welfare states. In his sketch of this vision, Piketty provides a principled account of how such a society would look and how it would modify the current status of private property through co-managed enterprises and the creation of temporary ownership (...) models. He also sets out two principles for when inequalities are just. The first principle permits inequalities that are beneficial to the worst-off, while the second permits inequalities that reflect differences in people’s choices and ambitions. This article identifies a tension between Piketty’s two inequality-permitting principles. It also argues that the procedural limits on how decisions are made within the enterprises of participatory socialism might create inequalities not permitted by the guiding distributive principles of participatory socialism. This tension points to the need for either further changes in firm structure and ownership, an even more progressive taxation scheme, or an egalitarian ethos reflected in citizens’ choices in their everyday lives under participatory socialism. (shrink)

Twenty-five years ago, communism, the political system dominant in Eastern Europe, collapsed. Two years later, in 1991, the Soviet Union was dissolved. The People’s Republic of China remained the sole communist power, but throughout the 1990s its anti-capitalist party line was watered down through the introduction of market-oriented reforms. Today, only one country can be said to be truly communist: North Korea. Communism, in the 1980s a mighty geopolitical force holding half of Europe and roughly one third of the world’s (...) population in its grip, is today confined to an internationally isolated prison state, one of the poorest countries on the planet. How are we to remember the past of a utopia? By recounting the utopian dream? Or maybe by still dreaming the dream, hoping for it to come true? After all, as Alain Badiou puts it in his book The Communist Hypothesis,1 “Communism is [still] the right hypothesis”, and those who disagree “resign themselves to the market economy, to parliamentary democracy” — the true evils of our time, in Badiou’s eyes. But was communism just a dream, just a hypothesis? (shrink)

What is typical of Hayek's challenge concerning socialism is that he always maintained that this question was for economic theory to decide. Sketching the historical background of what has come to be known as the "socialist calculation debate" (section 1), I try to link this debate with the Menger-Wieser Zurechnungsproblem and show that the Pareto-Barone approach has determined the theoretical form of this economic controversy. I then go on to explore Hayek's 'inapplicability' argument (section 2) and try to show how (...) it is related to Mises' 'logical impossibility’ argument. This is followed by an examination of Hayek's second argument (section 3), which I refer to as 'the evolutionary argument'. I display what is the specific gist of this argument and connect it tightly to the first one. I then discuss certain methodological issues (section 4) pertaining to the allegedly radical difference between Mises' arguments and Hayek's tentative refutation of socialism. Here I challenge the received view that Mises' based his case on the 'impossibility in principle' of socialism, whereas Hayek's own position was to challenge the 'possibility in practice' of a centrally planned economy. This reading (especially by Willem Keizer) of Hayek's contribution to the debate seems to me misguided and unwarranted. I attempt to propose, on the contrary, that both lines of reasoning involve the same kind as arguments since both of them should be interpreted as impossibility theorems. Finally (section 5) I try to give an appropriate and adequate answer to the question raised in the title of this paper. (shrink)

Most people presume that government is always responsible for providing solutions to pollution problems, including transportation pollution. This paper examines the validity of this argument from a minarchist libertarian, property rights principles perspective, and concludes that government cannot solve these problems using command-and-control legislation. The primary policy suggested for government to adopt is the strict adherence to property rights protection and enforcement regarding polluters, including themselves. Further encouragement of market forces could be accomplished by stopping interference within the market at (...) critical points, namely the production of roads, production and sales of automobiles, and the subsidization of alternative fuels. (shrink)

Abstract David Ramsay Steele's From Marx to Mises argues correctly that the standard account of the economic calculation debate is a misrepresentation. Mises and Hayek were not bested by Lange and Taylor. However, it is not true, as Steele claims, that socialists have yet to face the Misesian challenge, nor that the debate over socialist calculation sheds much light on the recent collapse of communism. Steele's critiques of market socialism and worker self?management and his treatment of Marx are, moreover, deficient, (...) as a consequence of his ?Libertarian Panglossism.? Tout est an mieux . . . dans ce meilleur des mondes possibles. (shrink)