[sudosysgen]

I'm on my phone right now, but there is a paper on the exact P=NP efficient market question.

I don't assume that planning an economy would require solving NP-hard problems to outperform the market because I am certain that the market itself cannot solve them efficiently.

As for resources, us as a society already dedicate trillions of dollars a year to market planning - its called profits and capital gains, as well as the entire finance and real estate industry. As long as the planning system requires less than a trillion dollars a year to run even without being more efficient than the market at whichever cost function we choose it will be more efficient overall.

[betwixthewires]

> I don't assume that planning an economy would require solving NP-hard problems to outperform the market because I am certain that the market itself cannot solve them efficiently.

That sounds to me like an ideological position, which is fine of course.

But the question arises, if solving distribution problems requires a participant to solve NP hard problems as you've said (I'd appreciate a link to that paper whenever you can get around to it, I seriously do want to read it and am not just shouting "source", same goes for the distributed planning in anarchist planned economies we were discussing in another thread) then how would that not be true for a machine? Either the problem is NP hard or it isn't, regardless of what entity is trying to solve it.

[sudosysgen]

It's not an ideological position - I don't think that P=NP and I don't think that the Church-Turing hypothesis is false so I don't think that markets can solve NP problems efficiently and thus I don't think markets are efficient.

NP-hard problems can be approximated. You get the machine to approximate a solution that is better than what the market could do or thereabouts.

[betwixthewires]

Why can't the market approximate NP problems at least as good as a central planning entity?

[sudosysgen]

Perhaps it can, perhaps it can't. I don't think we can know without real world trials. But planning, whether central or not, has the crucial advantage that it is much more flexible. Beyond that, we don't even need to go fully into one extreme.

The fact that it has to aproximate at all however completely invalidates Hayek's argument, which is why it is worthless - his assumptions beg the question.

That being said, given the ability of incredibly rudimentary paper-and-pen, low tech planning systems where planning is basically a very difficult computer science problem to get within a third to a half of what markets can do, I think there is a solid shot that planning can outperform markets in the majority of industries, though perhaps for smaller industries a flexible hybrid will be more useful.

[betwixthewires]

Honestly man, I really wanted to get at your reasoning for your position but your statements are all assertions and no reasoning. Markets can't optimally distribute resources because there are NP hard problems, but machines can approximate NP hard problems so NP hard problems are no problem for central planning, as to whether a market can also approximate? Who knows. That's your narrative so far. So why did you bring up NP hard problems in the first place if they're mostly irrelevant to your argument?

I did enjoy this conversation though. And again, I'd love to read what you have on decentralized planning in anarchist planned economies and NP hard problems humans have to solve in markets. If you can show me a paper that demonstrates that markets require participants to solve NP hard problems I'll be done with markets.

[sudosysgen]

I never said that central planning must work better or worse, just that Hayek's reasoning doesn't hold up because it starts from the ridiculous assumption that markets always find the equilibrium, always propagate local knowledge, etc.., and those are the reason why they theoretically are better than planning according to Hayek. I'm arguing against a purely theoretical argument that was cited with purely theoretical reasoning. The source for Hayek's assumptions implying P=NP is this : https://arxiv.org/pdf/1002.2284

I personally don't care for the purely theoretical arguments that Hayek makes, and yes the arguments are full of apriorisms and assumptions but that's the Austrian school for you and that's what you need to prove that markets must be better than planning.

The actual argument I'd make why planning can outperform markets in many industries and cases is pretty straightforward - markets require duplication of labour, they cause intrinsic crashes, they hurt knowledge transfer because they require intellectual property, they require infinite growth, and more.

Meanwhile actual implementations of planning have been plagued by incredibly slow iteration times (in the order of 5-4 years), access to data so horrible that CIA data was sought by planners, excessive centralization due to the impossibility of getting popular input, very low transparency, limitations in processing as data was collected and processed by hand, allocation of resources by hand, etc...

Planning is fundamentally a computer science problem at every level, and every single major defect can be fixed or palliated using techniques developped from computer science.

Because of this and the relative competitiveness, on the order of 1/3, of planning despite horribly deficient implementations, I think that there's a solid shot that planning can be a better solution than markets in most cases, though not all.

Finally, central planning doesn't actually mean eliminating markets - they are still useful for gaging the relative value and demand in consumer goods. Rather, the goal is to replace capital markets.

There, that's my case for why it is very probable that planning can be a better alternative to capitalist markets in most cases.

[nradov]

Real world trials have been run multiple times and central planning failed every time. Technology improvements haven't changed that basic reality.

[sudosysgen]

In every single attempt access to quality data, justifiable processing, transparency, and processing power was a huge limiting factor.