Hacker News Reader

Comment by tom_mellior | Hacker News Reader

> One of the strengths of capitalism is that it solves the "local knowledge problem" (see https://en.wikipedia.org/wiki/Local_knowledge_problem) by distributing the decision making to the consumers.

I don't follow. People living in non-capitalist systems go shopping as well. What's the difference to capitalism from the point of view of the consumer or the shop?

View on HN

And what's to stop national economy planning from distributing decision making in the same manner? It's not like Walmart doesn't do nation-level planning.

I talked to a lot of people who lived in the soviet union, who watched Finnish television broadcasts that could be heard beyond our borders. Their parents told them that all the tv ads for e.g. bananas in the 1990s were in fact propaganda, and that regular people in Finland surely couldn't purchase such exotic fruits.

So I can assure you, the people living in "non-capitalist systems" do not in fact "go shopping".

Of course they go shopping, they need food and stuff. I would know, I grew up in an Eastern European country in the 1980s. We had shops. What I think you possibly mean is that there is little selection. That is true. But the context here was whether the relevant information was there: Of the things that are there, what do they prefer? What sort of things do they ask for that are not available?

The difference to capitalism is that in capitalism this kind of information does trickle "upwards" to the wider economy, because the store orders more of the popular stuff and less of the unpopular stuff. In a planned economy, the information is not propagated upwards because the planners don't care, or wouldn't be able to do anything about it. But the "local knowledge" that the OP mentioned is there.

(Also I'm confused whether you count 1990s Finland as a non-capitalist system.)

Reply on news.ycombinator.com