Planning and the market do not exclude each other. Planning may utilise the uniformity of behaviour patterns of units operating in the market as one … - Oskar Lange

The actual capitalist system is much better described by the analysis of Mrs. Robinson and of Professor Chamberlin than by that of Walras and of Marshall. But the work of the latter two will be more useful in solving the problems of a socialist system.

The existence of an ideological element in each science has caused some representatives of the sociology of knowledge to deny the objective validity of scientific statements, particularly in the domain of the social sciences. Such a conclusion is unwarranted. The validity of scientific statements can be ascertained with impersonal objectivity through an appeal to facts. Predictions derived from scientific statements are or are not borne out under the test of verification. The outcome is entirely independent of human motivations, conscious or subconscious; it depends entirely on the correctness of the scientific procedure applied in establishing the statements.

Having treated the theoretical determination of economic equilibrium in a socialist society, let us see how equilibrium can be determined by a method of trial and error similar to that in a competitive market. This method of trial and error is based on the parametric function of prices. Let the Central Planning Board start with a given set of prices chosen at random. All decision of the managers of production and of the productive resources in public ownership and also all decisions of individuals as consumers and as suppliers of labour are made on the basis of these prices. As a result of these decisions the quantity demanded and supplied of each commodity is determined. If the quantity demanded of a commodity is not equal to the quantity supplied the price of that commodity has to be changed. It has to be raised if demand exceeds supply and lowered if the reverse is the case. Thus the Central Planning Board fixes a new set of prices which serves as a basis for new decisions, and which results in a new set of quantities demanded and supplied. Through this process of trial and error equilibrium prices are finally determined. Actually the process of trial and error would, of course, proceed on the basis of the prices historically given. Relatively small adjustments of those prices would constantly be made, and there would be no necessity of building up an entirely new price system.