ABSTRACT
The main functions of any economic system are those of distributing limited resources among diverse and, many times, competing uses, so as to determine what is going to be produced, how, and in which amount, and how the final products are to be distributed among the population. This chapter expresses the fact that productive efficiency can be phrased mathematically is insufficient to explain our adherence to it. It examines the exact meaning of efficiency as conceived in mainstream economic theory. The chapter also expresses that the notion of efficiency rests in the same moral foundations or type of knowledge. It establishes a model of the economy where, given any set of prices, producers' profit motivations will lead them to produce efficiently. Since the proof assumes the convexity of the production possibility frontier, then any efficient outcome can be seen, in principle, to be achievable by market interaction.
