1.3.3. Market

Thus, planning the solution of complex problems faces two issues. First, the problem of aligning the subjective values of various acting agents. Second, the problem of dispersed knowledge, which the planning agent is unable to collect and account for in plans, while its neglect easily disrupts the execution of the plan. Both of these problems can be solved in two ways.

The first path is the leveling of interfering factors. This is achieved through a transition to a maximally homogeneous totalitarian society with very primitive economic practices and an absence of development (development disrupts plans). In such a society, central planning copes reasonably well with its tasks. However, such a path is practically impossible to combine with the observance of libertarian principles.

The second path is the decentralization of planning. Instead of simplifying society and the environment for the sake of making central planning work, one can accept that people build and implement their own plans, relying on their subjective values and their local knowledge. However, such a society requires a mechanism for aligning individual plans; otherwise, it effectively ceases to be a society and collapses into self-sufficient units capable of handling only rather primitive tasks.

Traditionally, the market is defined as a set of practices that ensure the possibility of free trade between its participants. In a broader sense, the market can be defined as a set of practices that ensure the free conduct of any voluntary transactions. In this definition, the market turns out to be precisely the sought-after decentralized mechanism for aligning individual plans while observing libertarian principles. Thus, market transactions include the appropriation of ownerless property if others do not object, gifts, damage compensation by agreement of the parties, community cleanup days, and consensual sex.

Nevertheless, in a complex society, commodity-money relations—pertaining to the market in a narrower sense—begin to play a crucial role, which is why we will examine them in more detail.


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