" reflect the sum total of the inherently dispersed information about the supply and demand of millions of distinct individuals for each product."
"Free market prices give us our only access to this information.... This is why centralized economic planning is doomed to failure...."
'It's a short step from this core insight about prices to their failure to track any coherent notion of moral desert. "
"Claims of desert are essentially backward-looking.... Free market prices are essentially forward-looking."
" Current prices signals producers where the demand is now...."
" Capitalism is constantly pulling the rug out from underneath
even the most thoughtful, foresightful, and prudent production plans of individual agents..."
"individuals cannot count on their virtue being rewarded in the free market."
" the market isn't to reward people for past good behavior. It's to direct them toward producing for current demand, regardless of what they did in the past...."
"Several implications follow.... "
"(a) The claim "I deserve my pretax income" is not generally true...."
"(b) The claim that people rocked by the vicissitudes of the market... are getting what they deserve is also not generally true...."
"(c)It is in principle impossible for even the most prudent to forsee all the market turns that could undo them. "
"(If it were possible, then efficient socialist planning would be possible, too..)..."
" (d) The volatility of capitalist markets creates a profound and urgent need for insurance, over and above the insurance needs people would have under more stable (but stagnant)
economic systems. "
given the uncertainty of outcome path
in even
a well behaved complete Arrow market system....
(as say frank fisher suggests )
the practical impossibility to even reach
a nash "rest" state fast enough where innovations occur along the trail ...
and thus a value dynamic never reaches its set of just dessert prices
but at any rate
here's where G-S rampant market failures enter
to squelch
"... maybe private insurance would do a better job meeting people's needs for insurance in the event of unemployment, disability, loss of a household earner, sickness, and old age.... "
but hayek draws the conclusion :
" no argument that people have a moral claim to their pretax incomes, sufficient to preclude taxing it for insurance purposes, has survived critical scrutiny"
speaking of scrutiny ...
fred's niece :
