ABSTRACT
In the previous chapter we saw that orthodox economics could not derive the sort of social policy conclusions that were necessary in order to justify the positivist metatheory. The use of orthodox theory by the 1930s' market socialists, while legitimate, failed because the orthodox theory itself could not be sustained. In particular, the concept of rationality employed by the orthodox economists was static, and was therefore not able to consider questions of dynamic economy. The Austrian critique was that economic values—and therefore imputed costs—are totally subjective in nature and cannot be known to any planner. Furthermore, they believed, the interaction of rational individuals led to a distinct order which it would be unwise to attempt to alter.
