Oskar Lange's Theory of Socialist Planning

Abstract

This article shows that the belief that there is an alternative to the market (for a modern economy) is based on error and gives an analysis in history of ideas to show how the error arose. The relevance of an analysis that purports to deal with socialism and central economic planning is called into question. It is shown that the new school of socialist thought does not criticize market relationships but criticizes the real world market economy for not living up to the illustrative theory of pure competition. The outcome of the socialist controversy is the vindication of market relationships.