Elgar Companion to Hayekian Economics

Elgar Companion to Hayekian Economics

Elgar original reference

Edited by Roger W. Garrison and Norman Barry

The Elgar Companion to Hayekian Economics provides an in-depth treatment of Friedrich August von Hayek’s economic thought from his technical economics of the 1920s and 1930s to his broader views on the spontaneous order of a free society. Taken together, the chapters show evidence both of continuity of thought and of significant changes in focus.

Chapter 12: Hayek versus the neoclassicists: lessons from the socialist calculation debate

Peter J. Boettke, Christopher J. Coyne and Peter T. Leeson

Subjects: economics and finance, public choice theory, politics and public policy, public choice


An important question for any researcher who wishes to revisit the socialist calculation debate is: Why flog a dead horse? With the collapse of communism in 1991, there seems to be little value, other than for historical purposes, in rehashing the debate over socialism’s feasibility. Nevertheless, we believe that there are at least two very good reasons to consider this debate once again. The first reason has to do with the fact that socialism is an intellectually and emotionally powerful idea. This is particularly so as it is articulated by Karl Marx. Socialism is thus worthy of our most serious intellectual effort in analyzing its claims. The classical political economy thought experiment that highlighted self-regulation and harmony of interests was called into direct challenge by Marx, who argued that the natural workings of the market economy led to a clash of interests among classes and to market failure in the cases of monopoly and crises. In the wake of the collapse of real existing socialism, many intellectuals continue to find comfort in socialism’s promise of a better world, even if the particulars of how to achieve that better world are a subject of dispute and puzzlement. It is often contended that the events of 1989–91 were the outcome of frail humanity that failed to live up to the demands of socialism. It is our contention that by revisiting the debate concerning socialism it becomes apparent that the opposite is actually true.

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