Caroline P. Ch-3

Q: The main difference between competition and planning lies in what? Should we try to find a balance between the two?

A: Hayek argues that while the two both agree on that there must be some sort of a plan, or “framework”, for any economic system to prevail, the control of the framework is disputed between them. Competition gives the responsibility of planning to the individuals where as planning wants for a “central direction and organization” dictated by a “blueprint” (40-41). However, when competition is destroyed in an industry and each industry makes its own “blueprint”, there will then be formed a “corporative organization of industry” in which the individual becomes subject to the will of whomever runs the business to which they belong.