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 believe it has been said that one copy of The Times contains more useful information than the whole of the historical works of Thucydides.”
—Richard Cobden (1804–1865)
“When rich villains have need of poor ones, poor ones may make what price they will.”
—William Shakespeare (1564–1616)
“The law isn’t justice. It’s a very imperfect mechanism. If you press exactly the right buttons and are also lucky, justice may show up in the answer. A mechanism is all the law was ever intended to be.”
—Raymond Chandler (1888–1959)