Information and The Price Mechanism
Much of the literature in information economics was originally inspired by Friedrich Hayek's "The Use of Knowledge in Society" on the uses of the price mechanism in allowing information decentralization to order the effective use of resources. Although Hayek's work was intended to discredit the effectiveness of central planning agencies over a free market system, his proposal that price mechanisms communicate information about scarcity of goods inspired Abba Lerner, Tjalling Koopmans, Leonid Hurwicz, George Stigler and others to further develop the field of information economics.
Read more about this topic: Information Economics
Famous quotes containing the words information, price and/or mechanism:
“I have all my life been on my guard against the information conveyed by the sense of hearing—it being one of my earliest observations, the universal inclination of humankind is to be led by the ears, and I am sometimes apt to imagine that they are given to men as they are to pitchers, purposely that they may be carried about by them.”
—Mary Wortley, Lady Montagu (1689–1762)
“I have asked a lot of my emotions—one hundred and twenty stories. The price was high, right up with Kipling, because there was one little drop of something, not blood, not a tear, not my seed, but me more intimately than these, in every story, it was the extra I had. Now it has gone and I am just like you now.”
—F. Scott Fitzgerald (1896–1940)
“A mechanism of some kind stands between us and almost every act of our lives.”
—Sarah Patton Boyle, U.S. civil rights activist and author. The Desegregated Heart, part 3, ch. 2 (1962)