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On the Economic Theory of Socialism

Oskar Lange

Socialist calculation / market socialism

Lange's model is the canonical statement of market socialism and the indispensable reply in the calculation debate, central to socialist economic thought.

Synopsis

A rigorous argument that a socialist economy can rationally allocate resources by simulating market pricing, rebutting claims that planning is inherently impossible.

Core passage idea

Paraphrase · Modern copyrighted work

A central planning board can set prices by trial and error, adjusting them when shortages or surpluses appear, so socialism can achieve efficient allocation without private capital markets.

It reframes the socialist calculation debate by showing planning need not be blind, offering a theoretical answer to Mises and Hayek.

To avoid a bubble

Pair with Ludwig von Mises, Human Action.

Reading note

Engage it as a technical economic argument; understand the Mises-Hayek challenge first so Lange's solution lands.

Best paired with

Ludwig von Mises, Human Action

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