The Use of Knowledge in Society
Friedrich von Hayek
Chapter 25 in Readings in the Economics of the Division of Labor:The Classical Tradition, 2005, pp 270-284 from World Scientific Publishing Co. Pte. Ltd.
Abstract:
AbstractWhat is the problem we wish to solve when we try to construct a rational economic order?On certain familiar assumptions the answer is simple enough. If we possess all the relevant information, if we can start out from a given system of preferences and if we command complete knowledge of available means, the problem which remains is purely one of logic. That is, the answer to the question of what is the best use of the available means is implicit in our assumptions. The conditions which the solution of this optimum problem must satisfy have been fully worked out and can be stated best in mathematical form: put at their briefest, they are that the marginal rates of substitution between any two commodities or factors must be the same in all their different uses.
Keywords: Division of Labor; Specialization; Extent of the Market; Knowledge; Political Economy; History of Economic Thought; Increasing Returns; Equilibrium; Price System; Coordination (search for similar items in EconPapers)
JEL-codes: C1 C7 (search for similar items in EconPapers)
Date: 2005
References: Add references at CitEc
Citations: View citations in EconPapers (38)
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