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icantfindaname posted:I mean, basically every single one of the most miraculous expansions of production in history, in WW2 US, UK and USSR, in postwar France and East Asia, all made heavy use of central planning and state direction. Meanwhile basically every case of neoliberalization after the 1980s has not just been a disaster from a social perspective but from the very GDP growth perspective you claim is better served by Hayekian market liberalism. Most (all?) of Latin America’s growth performance was clearly better before neoliberalism and marketization than after. It’s just not empirically true that liberal market economies are more productive than planning, probably actually the opposite. you appear to be confusing expansions of production of war material with expansions of production, generally. the point of a planned, wartime economy is to hard convert the production of stuff from "what the populace demands" to "the poo poo we need for the war" not to increase the efficiency of the economy overall. it is to roll into a car factory and say "hi, you're making tanks now" not because that is more efficient at expanding the goods and services the economy produces, but because the government needs tanks, a lot of them, as soon as possible. you can, theoretically, argue that this demonstrates the superiority of a planned economy in reacting decisively to very significant shifts in societal demand. but at the end of the day the wwII analogies are not super useful because the US/UK used hybrid planning/market approaches and the people making the tanks certainly did not become owners of the means of production for the tanks - what was converted over to varying, disputable degrees was the planning function rather than ownership of capital. you are, of course, also ignoring the industrial revolution era which is...problematic...when you claim to be discussing "basically every single one of the most miraculous expansions of production in history"
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May 4, 2021 16:22
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all that said: icantfindaname, it is plain that you are getting tripped up by efficiency. efficiency is not the be-all and end-all of an economy, it is perfectly fine for various societal reasons to prioritize other issues over the efficiency of an economy. for example, in wartime, you may prefer a slightly less efficient economy that produces a lot of tanks! you may be far more willing to tolerate the inefficient allocation of human capital that a draft entails! or, you may feel that efficiency and fairness should be balanced - that an efficient economy that leaves the poor behind and simply accrues more benefits to the rich is inferior to a slightly less efficient economy that distributes benefits more fairly. it is generally pretty uncontroversial that a market system is generally more efficient than central direction. there are areas where it is well understood by all but libertarians that the market does not produce efficient outcomes and must be regulated (e.g. pollution). there are areas where it is well understood to all but libertarians that the market system breaks down and no longer has efficiency benefits compared to central allocation - wartime being the paradigmatic example with the least dispute, but by no means only one. the idea that the unregulated market solution is the best one is widely rejected by all but libertarians. that said, the implicit comparison you're making isn't a centrally planned economy - it's a very well regulated market economy, with significant government intervention. i am unware of any serious debate over if centrally planned economies are more efficient than regulated free market economies, merely dispute over if the societal benefits of such an economy are worth giving up that efficiency.
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May 4, 2021 16:35
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icantfindaname posted:I mean, basically every single one of the most miraculous expansions of production in history, in WW2 US, UK and USSR, in postwar France and East Asia, all made heavy use of central planning and state direction. Meanwhile basically every case of neoliberalization after the 1980s has not just been a disaster from a social perspective but from the very GDP growth perspective you claim is better served by Hayekian market liberalism. Most (all?) of Latin America’s growth performance was clearly better before neoliberalism and marketization than after. It’s just not empirically true that liberal market economies are more productive than planning, probably actually the opposite. what do you mean by "expansions of production"?
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May 4, 2021 17:33
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axeil posted:And yet they were right about this one thing: command economies generally suck at being productive compared to market economies. And they argued it with math and then other non-Austrians went and confirmed the math with empirical observation. Sorry that you hate the Austrians (I do too), but even people you hate can be right sometimes. Does that paper show resource efficiency, or does it show GDP per capita? Or am I reading that wrong?
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May 4, 2021 18:53
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Hello other number thread. I come with a gift basket of tweets from the number thread I come from. This lady is a Schwab shill who posts graphs all day every day. https://twitter.com/LizAnnSonders/status/1389525521181159424?s=19 It was cool reading someone's econ textbook rip, but I don't think I'm gonna stick around. So much easier to empty quote someone who posted "NUMBER GO UP". I hope you guys find your number footing and that your first crack ping is funny.
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May 4, 2021 18:56
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axeil posted:I literally posted a paper that proved the opposite of what you're arguing. The paper is about Eastern Europe, which is not relevant to my examples of postwar France, East Asia, or 40s era war production. Also, you can't compare Eastern Europe to Western Europe because the economies were not ceteris paribus equal on things besides planning versus markets. They were less developed overall, had lesser capital stock, less foreign trade, etc. If you compared capitalist, market-based Brazil or Argentina to Western Europe at the same time they would also be less efficient in technical efficiency terms Here is an overview of why the Soviet economy at least before the 1980s was not a failure, or at least performed as well as the non-Communist developing world that is the appropriate comparison https://press.princeton.edu/books/paperback/9780691144313/farm-to-factory Here's an entry in a fairly exhaustive series of blog posts about the USSR which is basically hostile and debunkatory, that concedes that static technical efficiency in the USSR was no lower than in other states, contrary to your paper https://nintil.com/the-soviet-union-productive-efficiency/ quote:So in the end, I think we can conclude that the Soviet economy was technically efficient in the trivial sense that soviet enterprises were working in the PPFs, given their level of technological development. This was in turn caused by slow and slowing technological progress. Allocative efficiency was low, as Novesays, due to the planning process itself, and TFP growth was lower than in the West, and decreasing. Finally, the growth model pursued by the Soviets, accumulating capital to generate more capital, proved to be a recipe for a quick takeoff, but also for stagnation and decline. To be sure, it didn't by itself cause the collapse of the Soviet Union, but it did contribute to the factors that led to it. evilweasel posted:you appear to be confusing expansions of production of war material with expansions of production, generally. the point of a planned, wartime economy is to hard convert the production of stuff from "what the populace demands" to "the poo poo we need for the war" not to increase the efficiency of the economy overall. it is to roll into a car factory and say "hi, you're making tanks now" not because that is more efficient at expanding the goods and services the economy produces, but because the government needs tanks, a lot of them, as soon as possible. There's a third factor besides efficiency and "fairness" although I'm not sure those are even different in a neoclassical framework, Pareto efficiency and TFP seems to cover both of them. Growth and the absolute volume of production is more important than either, and every instance of rapid growth (OK, after the year 1870) involved substantial central planning. Surely all subsistence economies are more efficient than a modern economy because the alternative is death, but that doesn't make them more desirable than the present day not not simply on "fairness" terms Finally the Marxian critique of the neoclassical and Austrian views is that subjective utility is a bad or even meaningless measure of value, and what is objectively necessary for social reproduction is the correct measure. By that framework winning WW2 is surely more efficient than what, making as many nylon stockings and varieties of toothpaste and breakfast cereal for civilians like in some stupid rear end reddit meme? And also WW2 planning didn't actually reduce civilian consumption Rainbow Knight posted:what do you mean by "expansions of production"? Rapid increase in total GDP  https://rooseveltinstitute.org/publications/public-spending-as-an-engine-of-growth-and-equality-lessons-from-world-war-ii/ https://rooseveltinstitute.org/wp-content/uploads/2020/07/RI_WWII_Working-Paper_202003-1.pdf
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May 4, 2021 19:13
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Honestly, I don't see the real distinction between military/civilian production beyond the particular emphasis needed by a government at that point. The Soviets had high degrees of military spending that arguably were a drag on consumer goods...but that wasn't because of central planning but because the Soviets were desperate to compete with a competitor with vastly larger economy and superior technology (although some fields like aerospace the Soviets were competitive in). A significant issue remains that people are still mixing Soviet history, concepts like a command economy, and Marxism all together when they are in fact separate things with some overlap: not all command economies were the Soviet Union, the Soviet Union was not always a command economy, and much of the Soviet Union was doing was very tangential to Marx's theories. (Also, I would say stuff like East Germany producing too many chandeliers could easily happen (and it does) in a free-market economy all the time. If anything it is arguably easier to fix in a command economy.)
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May 4, 2021 22:16
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Ardennes posted:(Also, I would say stuff like East Germany producing too many chandeliers could easily happen (and it does) in a free-market economy all the time. If anything it is arguably easier to fix in a command economy.) I believe this was the problem with pre 2008 (and perhaps present) General Motors. They needed to keep producing cars to post on paper fiscal solvency, even though there weren't enough customers to absorb said cars.
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May 4, 2021 23:01
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https://www.youtube.com/watch?v=VVp8UGjECt4
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May 5, 2021 00:18
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