Market/planned (fwd)

Richard Wolff rwolff at minerva.cis.yale.edu
Wed Jan 11 10:54:19 MST 1995


FYI

---------- Forwarded message ----------
Date: Wed, 11 Jan 1995 12:50:53 -0500 (EST)
From: Richard Wolff <rwolff at minerva.cis.yale.edu>
To: "Bradley J. Molyneaux" <Bradley.J.Molyneaux at Dartmouth.EDU>
Subject: Re: Market/planned


	Coase argues against state intervention aimed to right the
"errors" of private property and market transaction. That intervention
has long been warranted by claims that private property and markets lead
to "inefficient" economic outcomes because of various costs and benefits
which private market transactors either do not count or count
inaccurately thereby leading to actions taken or not taken that would
have yielded more efficient results.
	Coase argued smartly that while it was true enough that private
property owners interacting in markets might not know about or be able to
measure ALL the economic costs and benefits associated with any economic
act they were contemplating (and that hence inefficient acts could happen
anytime), HE WANTED TO DRIVE HOME THE POINT THAT GOVERNMENTS COULD NOT
EITHER KNOW OR MEASURE ALLECONOMIC COSTS AND BENEFITS SINCE THEY WERE IN
PRINCIPLE INFINITE AND HENCE NEITHER KNOWABLE OR MEASURABLE.
	Coase concluded that no warrant for state intervention exists. He
argued instead that analysis must presume that individuals react to
existing economic institutions and events by taking those steps that
"maximize" their well being. Thus, at any moment, that which exists is
the best everyone can do/get given their individual preferences and
financial capacities. This logical "proof" for the unwarranted nature of
any state intervention in economies comprised of private property owners
interacting in unregulated markets won the Nobel Prize for Coase.
	It is, of course, nothing less than the economic theory to
rationalize Voltaire's old argument attributed to his character Dr
Pangloss: everything is for the best in this best of all possible worlds."

	That Marxists should take efficiency logics seriously: that is
the great mystery and example of entrappment in the "other's" ideology.

R. Wolff

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