On the Hermeneutics Debate

Donald Lavoie is best known outside of Austrian economics for his work on the “socialist calculation debate.” In his Rivalry and Central Planning (1985), published by Cambridge University Press, he argued that the traditional account of the debate over the possibility of rational economic calculation under socialism was incorrect. While it was widely argued that the Austrians lost that debate to the market socialists, Lavoie established that Lange and Lerner never really addressed Mises and Hayek's chief concerns. Rather than losing the debate, as Lavoie demonstrated, the Austrians actually won it. After Lavoie, it became impossible to maintain the standard account.

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