ABSTRACT
Discussions induced by the collapse of the erstwhile socialist regimes in eastern Europe tend to focus on one ostensible ‘lesson’ from that experience, namely, that central planning based on command economy structures does not deliver adequate results either in terms of growth or in terms of innovative efficiency. For example, Bardhan and Roemer (1992) argue: ‘What the Eastern European experience has shown is that a system of pervasive state control of firms, plus the absence of markets, does not work.’ This perception leads to the conclusion that countries seeking a more egalitarian and socially rational economic order should not opt for a planned system where ‘major economic decisions (such as would be entrepreneurial decisions in a capitalist economy) are taken by some central government body, and embodied in a general complex of decisions, or conspectus, co-ordinated ex ante for a definite planning period’ (Dobb, 1969). Instead, implicitly positing the ‘planning principle’ and the market as alternative mechanisms for organising production, it is argued that countries seeking an alternative to capitalism should adopt some variant of ‘market socialism’.
