Prices and knowledge: A market-process perspective

146 Index61, 118; on costless information35–6; and disequilibriumanalysis 39–40; on ‘diverse’information 30; andinformational efficiency ofprices 2, 6, 31–7, 118; and‘noisy’ prices 33–5, 36–7; andnormative standard 36, 52–5;and price inferred knowledge40–3; and prices as ‘sufficientstatistics’ 47–52Grossman, S.J. 2, 30, 32–6, 39–42,54, 61; see also Grossman andStiglitzHahn, F.: and disequilibrium 10–11;and sloppy equilibrium concept 9,102Hayek, F.A. 1, 6, 7, 117; andcentralized control 113–14; andcomplexity 81, 86–7, 112; andequilibrium prices andinformation 29–31, 32–7, 38–55;and knowledge problem 15–16,25; on the market-processconcept 9–10, 14–17, 20–2, 24–5, 73–4; and response to change99–100, 101, 106–7; see alsoLange-Lerner-Taylor-HayekdebateHellwig, M.F. 39‘heroic abstractions’ 69Hey, J.D. 12, 13hierarchies 4; defined 108; andexternalities 75; government109–11; and markets 72–6, 96;Simon’s view of 72, 75–6; versusmarkets 108–15, 120Hirshleifer, J. 53Hurwicz, L. 30–1, 43Hynes, A. 13ignorance 4, 83; and centralplanning 46–7; and complexity77, 104, 115; deliberate 23; andeconomics of information 22–4;and entrepreneurial discovery38,76–8, 104; optimal 9, 23; andprofit opportunities 17; radical 4,5, 119; sheer 23–4, 27, 38, 84,90, 107, 115, 121; Simon’sconcept of 76–8, 84, 90‘imaginary construction’, equilibriumas 21–2imperfect competition 67imperfect information 53–5incentives 119, 120; profits as 19–20,47, 55, 100, 111, 114; role ofmoney as 121inflation, and entrepreneurialdiscovery 122information: bridging 89–90, 91;collection of 32–3; costless 35–6,43, 53; costly 23–4, 26, 29, 32–3,34, 38–9, 53–4, 118; costs 24, 72,101; dispersed 30–1, 82;externalities 38–9; andgovernment planning 54;imperfect 53–5; irrelevant 68,78–9; and prices 16, 29–62, 80–3,116–20; prices as aggregated 30,32–7, 37–8; prices as summariesof 80, 81–3, 116, 120; as publicgood 53; and role ofdisequilibrium prices 29–30,44–7, 55–60, 118, 119–20;transmission of 30, 35, 37–8, 108;unquestioned 56–8; see alsoknowledgeinformation processing: in centrallyplanned systems 107; electronic67; human 66–7, 68, 79, 86, 96–7,118; and markets 73–4‘information rich’ world 67–8,115–16initiative, concept of 65innovation 98, 100, 114; andaspiration levels 71institutions, comparative standards25–7, 54–5integration, horizontal and vertical107investment 53, 65, 110‘invisible hand’ 11, 30, 35Kirzner, I.M.: on co-ordination