According to Hayek,a social planner has no hope of matching the efficiency of a competitive pricing system because
A) no social planner can be completely benevolent in his actions.
B) a social planner cannot have access to the specialized knowledge of individuals.
C) the social planner will be unable to fully monitor the activities of his agents.
D) people are selfish and will not be actively altruistic to the social planner.

Question

Quizplus · Accepted Answer

Hayek argues that a social planner cannot have access to the specialized knowledge of individuals, which is necessary for efficient allocation of resources. In a competitive market, prices serve as signals, and individuals make decisions based on their unique knowledge and circumstances. A social planner cannot replicate this individual knowledge, and therefore cannot allocate resources as efficiently.

According to Hayek,a Social Planner Has No Hope of Matching