The Impossibility of Democratic Socialism in a Factionalized Society: Hayek, Jewkes, and the Arrow Theorem

Makovi, Michael (2016): The Impossibility of Democratic Socialism in a Factionalized Society: Hayek, Jewkes, and the Arrow Theorem.

Abstract

Andrei Shleifer and Robert W. Vishny (1994) use Public Choice analysis to criticize market socialism, but they dismiss Hayek's Road to Serfdom (2007 [1944]) as irrelevant. Contrariwise, Peter J. Boettke (1995) and Peter T. Leeson with Boettke (2002) argue that Hayek (2007 [1944]) advanced a form of Public Choice analysis, including an adumbration of Arrow's Impossibility Theorem. This essay shows that John Jewkes joined Hayek in presaging a form of the Arrow theorem. In addition, this essay elucidates the specific implications which the Arrow theorem has for democratic socialism. Democratic socialism is impossible, in the sense that it cannot successfully accomplish the goals of its advocates, because the Arrow theorem implies that democratic political institutions are fundamentally incompatible with socialist economics. Similar problems apply to deliberative democracy.

• Item Type: MPRA Paper
• Language: English
• Keywords: Hayek; Road to Serfdom; democratic socialism; market socialism; economic democracy; deliberative democracy; totalitarianism; public choice; government failure; arrow; impossibility; rent seeking; rent-seeking
• Subjects: A - General Economics and Teaching > A1 - General Economics > A12 - Relation of Economics to Other Disciplines; B - History of Economic Thought, Methodology, and Heterodox Approaches > B2 - History of Economic Thought since 1925 > B24 - Socialist ; Marxist ; Sraffian; B - History of Economic Thought, Methodology, and Heterodox Approaches > B2 - History of Economic Thought since 1925 > B25 - Historical ; Institutional ; Evolutionary ; Austrian; B - History of Economic Thought, Methodology, and Heterodox Approaches > B5 - Current Heterodox Approaches > B51 - Socialist ; Marxian ; Sraffian; B - History of Economic Thought, Methodology, and Heterodox Approaches > B5 - Current Heterodox Approaches > B53 - Austrian; D - Microeconomics > D7 - Analysis of Collective Decision-Making > D70 - General; P - Economic Systems > P1 - Capitalist Systems > P10 - General; P - Economic Systems > P2 - Socialist Systems and Transitional Economies > P20 - General; P - Economic Systems > P3 - Socialist Institutions and Their Transitions > P30 - General; P - Economic Systems > P5 - Comparative Economic Systems > P50 - General

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