Why is it likely that a market economy will perform better than a command economy?
What will be an ideal response?
Difficulties like the coordination problem and the incentive problem suggest that the reason for the fall of the most of the planned economies is that the central planner does not fully understand consumer wants and the production capabilities of every sector of the economy, and it is difficult to incentivize workers if prices are not utilized. Because any individual knows only a small fraction of all that is known collectively, it is impossible to replicate the work of the invisible hand. Therefore, a market economy is likely to perform better than a command economy.
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