Thursday, October 24, 2019
Socialist Planning Failed from the Very Beginning
That the planned socialist economies of the USSR and Eastern Europe suffered from serious dysfunctionalities was revealed already in the 1950s by American scholars based on interviews with former managers. The Hungarian economist, Janos Kornai, was the first to reveal in 1957 from within the Soviet bloc that the socialist planned economy was not even planned. Kornai went on to study the pathologies associated with planned socialism, such as soft budget constraints and shortage economies that threaten to bleed over into contemporary market economies.
go to Public Choice