> ANDREW
> it is clear that the decentralised self-regulating
> model of socialism (DS) has no way of ascertaining
> opportunity costs. It therefore has no way deciding
> between between projects, and for this reason alone
> cannot possibly work.
> ROBIN
> If project A requires 10 units of factor X and
> project B also requires 10 units of factor X but there
> is only 15 units of factor X available then you know
> very well that the opportunity cost of satisfying all
> of A's requirement of factor X is that you can only
> satisfy half of project B's requirement of factor .
> In other words the opportunity cost of fully
> satisfying A's project requirement is that project
> B's output has to be scaled back by half.
ANDREW: Where there are two products and two factors such mental
processes are indeed feasible. There are only a few permutations to
choose from. But in the real world where there are millions and
billions of permutations it isn't - hence the need for a simple
measure that people can comprehend - a unit of account.


ROBIN: This demonstrates conclusively that you are not really
addressing the concept of decentralised socialism at all and that you
not taken on the board any of the arguments about how such a system
could economise on factors of production without a common unit of
accounting/exchange. What you are talking about is central planning
whixch is a complete red herring....


>
>
> ROBIN
> Whether you would opt to fully satisfy A's project
> requirements or B's requirements depends on which
> output you value you most - and that means placing A
> and B along an ordinal scale.
ANDREW: This puts the cart before the horse. You cannot decide on A
or B until you know their opportunity costs. Feasible for two
products, but not for reality.]


ROBIN: Actually, as Ive already indicated, you can in a system of
decentralised socialism ascertain quite easily the implications of
allocating a particular scarce resource between a number of projects
quite independently of any evaluation. Therefore your criticism that
I am putting the cart before the horse is quite invalid. If you
wanted, I could easily demonstrate to you that if project A requires
5 units of X and project B requires 10 units of X and you have only
10 units of X, then gaving A absolute priority in the allocation of X
would mean you could only allow B , 5 units of X. On the other hand,
if B had absolute priority in the allocation of X, then A would get
zero units of X (as there are only 10 units of X which are fully
claimed by project B).

Note that I have said nothing about whether A or B should be
prioritised; all I havce demonstrated here are the allocative
implications of certain decisions. You say these implications have
to be worked out before you can make a choice or decision based on
your evaluation of which is more important. Well you can certainly
do that but I see reason why you necessarily HAVE to do that.

At the end of the day, however - and contrary to what you assert -
the notion of "opportunity costs" necessarily implies evaluation (it
concerns the BEST alternative you forego, where "best" implies an
evaluation) otherwise it is a meaningless or worthless concept. My
point is that evaluation is essentially a subjective matter which
lends itself only to an ordinal scale (A is better than or preferable
to or more valuable than, B). To pretend that you can somehow
objectively measure (in the form of prices) preference or value along
a cardinal scale (which lies at the root of the argument about the
alleged for a common unit of account) is a mumbo jumbo bogus
economics which has not got a theoretical leg to stand on. It falls
foul of the incommensurability problem not to mention the problem of
composition (i.e. that individual preferences are somehow expressed
through or capture in aggregate/social preference or market demand -
an argument that is as baseless as the statistical concept of
the "average person")

Best regards

Robin
www.worldincommon.org