Thanks!
It doesn't look to me as if this addresses the question I thought Lumifer and I were arguing about, though: namely, whether we know that the collapse of the communist economies of the USSR and its satellites shows that central planning is a bad idea. (See notes 3 and 4 below.)
Maskin's lecture says that theoretical economic analysis has led economists to believe that in an idealized situation (in particular, with no monopoly/monopsony power and no externalities) free markets are in some sense optimal. OK, fine (but see note 2 below), but that's a quite separate question from what conclusions we can draw from the alleged fact that "central planning failed" (see note 1 below).
... I find that there are a bunch of other largely separate things I need to say.
Note 1: For all I know, there may indeed be overwhelming evidence that the late-20th-century failures of communist states were largely the result of economic catastrophe caused solely by central planning. But Maskin's lecture doesn't appear to contain or point at anything resembling such evidence.
Note 2: I would be more completely convinced by a consensus of academic economists if there were more sign of mechanisms by which academic economists' opinions could be strongly constrained by reality. I don't doubt the correctness of the mathematical manipulations, but how applicable those are to actual economies is another matter. (I take it we can agree that it's possible for consensus within an academic field to be quite disconnected from reality; consider e.g. the theology of any religion you don't follow. I think economics is better off than theology in this respect, but it seems to fall some way short of, say, chemistry.) Having said which, I am in fact perfectly happy to accept the economists' consensus that markets generally do a much better job of price-setting than central planning, and at no point in this discussion have I said (or intended to imply) otherwise.
Note 3: It's possible that I have misunderstood Lumifer's comment "Sigh. Why do you think central planning failed?" -- which I take to mean something like "Gee, Jiro, you're being stupid. It's common knowledge that the communist USSR and its satellites collapsed because their economies were wrecked by central planning, and if you understood that you'd see that what you're proposing would be disastrous for the same reasons".
Note 4: So far as I can see, what Jiro was suggesting really isn't very much like the "central planning" of (e.g.) the USSR. S/he proposed interference with prices only in cases where sellers are desperate (having in mind goods that people normally wouldn't sell unless desperate) which may or may not be a good idea but has basically nothing to do with the question of markets versus central planning (versus anything else) for "normal" price-setting.
Specifically, what Lumifer quoted end of:
Maybe the primary reason why the USSR wasn't a roaring economic success was that central planning is inferior to free markets, but I don't think we have enough evidence to make that claim with a lot of confidence.
So intended to address question of central planning --> bad economy? rather than bad economy --> central planning bad? Maskin's lecture speaks to that point. But unimportant.
Maskin, like most economists, confuses efficiency with efficacy. I cited him just to indicate that academic economists are v...
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