ReImagining Liberty 017: Don Lavoie and the Case Against Planning (w/ Pete Boettke)
Oct 5, 2022
Pete Boettke, an economist and professor at George Mason University, shares insights on his mentor Don Lavoie, a pivotal figure in Austrian economics. They delve into Lavoie's critiques of economic planning and the socialist calculation debate, highlighting Mises and Hayek's contributions. Boettke discusses how Lavoie challenged the libertarian right's alignment and the cultural shifts post-Cold War. They also explore whether modern AI can tackle the knowledge problem, emphasizing tacit knowledge's essential role in understanding economics.
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From Computer Science To Economics
- Don Lavoie transitioned from computer science to economics after reading Human Action during a pointless summer job.
- He earned a PhD under Israel Kirzner and published Rivalry and Central Planning with Cambridge in 1985, shaping a generation of students.
Why Calculation Needs Property And Prices
- The socialist calculation debate asked whether abolishing private property destroys the ability to do rational economic calculation.
- Mises argued prices and property are necessary for calculation, and Hayek added the contextual, dispersed-knowledge critique.
Hayek's Two-Pronged Response
- Hayek split his response into philosophy of science and institutional analysis to explain why economists missed the knowledge problem.
- Lavoie updated Hayek and Mises for later debates by stressing institutions and the tacit, contextual nature of knowledge.
