The essential difference between a private enterprise system, which will from now on concern us, and the alternative forms of the planned economy considered hitherto lies in the location of the ultimate authority to allocate resources. In the former system this authority is parcelled out among many different people, while in the latter it ultimately resides entirely with the government. The institution peculiar to private enterprise is private property, which confers on individual persons the right to devote particular resources
to whatever purposes they choose, provided only that these are not prohibited by the laws. Such a right, even in a planned economy, may be granted to men in respect of their own labour, in that they are permitted to work in whatever job they prefer, and for hours of their own choosing, at wage rates fixed by the government. They may also be free to make whatever use they care of their personal, household effects. But ownership of the material means of production, in a system of full and detailed central direction, will be vested in the state.