What Did Keynes and Hayek Believe About Government Central Planning

question 227

Multiple Choice

What did Keynes and Hayek believe about government central planning?

• A) Both believed that central planning could be used to allocate resources efficiently.
• B) Both believed that perverse political incentives would undermine the ability of central planners to allocate resources efficiently.
• C) Keynes believed that government central planning could improve on market outcomes; Hayek disagreed, arguing that both political incentives and insufficient information would undermine their ability to do so.
• D) Keynes believe that central planning would fail because the policy-makers did not have sufficient information to plan efficiently; Hayek believed that efficient central planning was possible if political decisions were made democratically.

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