socialist planners can’t just invent prices out of thin air
Which is why they don’t do that in any planned economy. Prices are set rationally based on complex calculations, the main difference between centrally planned prices and free market prices is that there’s no pressure to raise prices to the maximum for profit, and the state has the ability to make things more or less expensive (essentially taxing/subsidizing them) for other reasons instead. It can lead to a situation where the capitalist look at how cheap gasoline is in the Soviet Union and say “that doesn’t make sense! surely people will just dump their unused gas out to get more free/near free gas to replace it” but in reality everything makes perfect sense within the planned system.
And perverse incentives exist within every human-made system, production quotas that led to piles of poor-quality parts or unwanted widgets in the USSR are an example, so is price gouging, exploiting truck drivers, or taking a deliberately longer route because the cost of gas is outweighed by the labor gains in capitalist economies is another. The good thing is that humanity has gotten pretty good at catching those and addressing them, as we have deepened out knowledge of complex systems.
Which is why they don’t do that in any planned economy. Prices are set rationally based on complex calculations, the main difference between centrally planned prices and free market prices is that there’s no pressure to raise prices to the maximum for profit, and the state has the ability to make things more or less expensive (essentially taxing/subsidizing them) for other reasons instead. It can lead to a situation where the capitalist look at how cheap gasoline is in the Soviet Union and say “that doesn’t make sense! surely people will just dump their unused gas out to get more free/near free gas to replace it” but in reality everything makes perfect sense within the planned system.
imagine if a state subsidized the costs of cars. boy would that be bad or what
And perverse incentives exist within every human-made system, production quotas that led to piles of poor-quality parts or unwanted widgets in the USSR are an example, so is price gouging, exploiting truck drivers, or taking a deliberately longer route because the cost of gas is outweighed by the labor gains in capitalist economies is another. The good thing is that humanity has gotten pretty good at catching those and addressing them, as we have deepened out knowledge of complex systems.