ABSTRACT
This chapter describes the issue of rational economic calculation under socialism in light of a third variant of market socialism, a variant dubbed by Ludwig von Mises the "artificial market". This third variant of market socialism will be termed "pragmatic market socialism," to distinguish it from Langian market socialism and cooperative market socialism. The chapter is concerned with the potential economic performance of a pragmatic market socialist system in relation to that of contemporary capitalism. The pragmatic market socialist proposal is founded on the judgment that, at least potentially, the question of "capitalism versus socialism" is almost entirely independent of the question of "market versus plan". The chapter discusses questions of static economic performance, and questions of dynamic economic performance. It presents a very simple model of "capital management effort," which employs very elementary and almost universally accepted economic principles.
