Re: Participatory Planning

[Allin Cottrell <cottrell@xxxxxxxxxxxxxxxxx>]

1. In response to Barkley's parting shot, the claim was
obviously not that the evolution of a capitalist economy
is slow relative to actual biological evolution (which
is constrained by the rate of genetic mutation and the
length of the reproductive cycle).  Rather it was that
evolution under capitalism is slower, and more likely to
get trapped at a local optimum, than evolution in a
hypothetical (but technically feasible) efficient
planning system that uses high-speed computers to mimic
a Darwinian search of economic state space.

2. On innovation (in response to both Barkley and Steve Keen).
Clearly it is possible for a planned system to stagnate,
particularly if the planners deliberately devote little
resources to the innovation process (other than in the
military and space sectors).  But in a democratic planning
system, the citzenry could decide to devote x per cent of
total social labor time to seeking out new products and pro-
cesses.  Teams of potential innovators could apply for grants
from this budget.  But then what about the "incentive to
innovate", you ask.  (Implicitly there is none, in the absence of
huge financial gains for successful innovators?)  Basically,
I find this a strange argument to be coming from academics.
What incentive do _we_ have to innovate, other than the
sort of incentives that would be present in any healthily
open and democratic socialism (e.g. the recognition of
one's peers, greater esteem and security in one's job, and
perhaps a modest pay bonus)?  And yet isn't innovating (in
our theoretical fields) what we do (or try to do) all the
time?  How far do you want to push homo economicus?  I think
he's just as misleading a caricature as the totally selfless
Socialist Man.

On a subsidiary point here, Steve is worried that thinking
in n-dimensional input-output terms will somehow freeze n.
Here, I don't think you are really taking on board what is
possible in the field of computation these days.  Yes, for
any particular simulation, n is given, but if the plan-
balancing calculations can now be done and re-done in hours or
even minutes, even for n in the millions (as Paul and I
claim in our book -- anyone is welcome to check our
calculations) this does not at all imply that n has
to be fixed for 5 years, or even 5 months.

3. On information (primarily in response to Barkley, I think).
In the system whose contours Paul and I have been exploring,
particular production 'projects' -- or those whose output is
marketed to consumers at any rate -- are expanded or contracted
according to the value of this indicator: the ratio of (a) the
approximately-market-clearing price of their product, in labor-
tokens, to (b) the total labor content of their product.
('Labor-tokens' are what the citizens are paid for their work,
and what they spend to acquire consumer goods.)  A project that
overstates its input requirements, in classic Soviet style, will,
cet. par., show a poor value of this indicator and will therefore
be contracted (in the limit, shut down).  To maintain operations,
projects must use no more total labor hours (direct plus that
embodied in means of production) than consumers are willing
to pay for their product.  We also discuss how this general idea
might be extended to non-consumption goods (albeit less directly).


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Allin Cottrell
Department of Economics
Wake Forest University
cottrell@xxxxxxxxxxxxxxxxx
(910) 759-5762
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