The China Thread

[The Minsky Moment]

Probably through trial and error.

But what to try and how do you recognize error?
Hayek was wrong about almost everything but not about the knowledge problem. We don't even know what it is we need to know.

[Valmy]

I have thought that a centrally planned economy might work with sophisticated enough data and computer resources.

We'll see if China successfully models it for us 

It's an interesting thought experiment, that might work if (and it's a big if) self interest of the decision makers is removed. What we are seeing in China are decisions being made for a reason other than optimal well being of the population.  It's a bit like the when say communism failed in the Soviet Union and the reply being that Communism was never tried in the Soviet Union.  But the question remains, could it ever really be implemented, or would self interest of those in charge always become the imperative.


I tend to think it is the latter, and for all its warts, Liberal Democracy may be the best model.

Well central planning has almost certainly been tried. Seems to me a regulated market economy works with the least disastrous results.

Liberal Democracy is not an economic model But if it is I would say straight up liberalism has a long history of disastrous economic meltdowns.

[crazy canuck]

I have thought that a centrally planned economy might work with sophisticated enough data and computer resources.

We'll see if China successfully models it for us 

It's an interesting thought experiment, that might work if (and it's a big if) self interest of the decision makers is removed. What we are seeing in China are decisions being made for a reason other than optimal well being of the population.  It's a bit like the when say communism failed in the Soviet Union and the reply being that Communism was never tried in the Soviet Union.  But the question remains, could it ever really be implemented, or would self interest of those in charge always become the imperative.


I tend to think it is the latter, and for all its warts, Liberal Democracy may be the best model.

Well central planning has almost certainly been tried. Seems to me a regulated market economy works with the least disastrous results.

Liberal Democracy is not an economic model But if it is I would say straight up liberalism has a long history of disastrous economic meltdowns.

Central planning to achieve political objectives yes.  But I read into your thought experiment an attempt to achieve optimal economic outcomes.  I don't think that has ever been attempted.

[Valmy]

Probably through trial and error.

But what to try and how do you recognize error?
Hayek was wrong about almost everything but not about the knowledge problem. We don't even know what it is we need to know.

Yeah I don't know. It is really just a theoretical thought experiment. If we had some kind of super AI gathering all the important data and managing the economy to achieve certain objectives could it work?

[DGuller]

I have thought that a centrally planned economy might work with sophisticated enough data and computer resources.

That's a very old debate.  Oskar Lange was arguing its possibility in the 1930s.

The problem is that even if you had the computing power needed and a workable model, how do you know and how can you get all the necessary information to input into the model?

I think in the age of AI China would eventually have better information about your wants than you do. 

[Jacob]

I tend to think it goes in this order (from best to worst):

• A liberal economic order with competent leadership and appropriate regulations and safeguards
• Centrally planned economy with competent leaderships and appropriate safeguards
• A liberal economic order with incompetent or corrupt leadership with misaligned regulations and safeguards
• Centrally planned economy with incompetent or corrupt leadership with misaligned regulations and safeguards

My read is that China's is tending towards 2, with dashes of 4; while the US is going all in at 3.

[Tonitrus]

I have thought that a centrally planned economy might work with sophisticated enough data and computer resources.

That's a very old debate.  Oskar Lange was arguing its possibility in the 1930s.

The problem is that even if you had the computing power needed and a workable model, how do you know and how can you get all the necessary information to input into the model?

I think in the age of AI China would eventually have better information about your wants than you do. 

It's not just your final duty...you want to go into the tanks and become one with all the people.

[DGuller]

I tend to think it goes in this order (from best to worst):

• A liberal economic order with competent leadership and appropriate regulations and safeguards
• Centrally planned economy with competent leaderships and appropriate safeguards
• A liberal economic order with incompetent or corrupt leadership with misaligned regulations and safeguards
• Centrally planned economy with incompetent or corrupt leadership with misaligned regulations and safeguards

My read is that China's is tending towards 2, with dashes of 4; while the US is going all in at 3.

I'm not sure that good planned economy can beat out shitty liberal economy, even with excellent leadership.  Part of the reason is that the scale of what needs managing is just too much, and would require many more levels of delegation than humans have learned to manage.  Another reason is that keeping the system competent and free of corruption for long is very hard.

I think it gets more uncertain when you add a hybrid category, something that has both a Five Year Plan and NEP.  That may have more of a chance at beating the shittiest of liberal economies.