A non-technical guide to the economics of boom and bust
Bureaucracy' is Ludwig von Mises' classic examination of the nature of economic management by the state
However, the adoption of socialism would mean the extension of bureaucratic management to all areas of the economy. The problem with this is that bureaucracies are inflexible. Changing economic conditions require the adaptation of production. Entrepreneurs implement changes in production because they seek profit. Mises explains why bureaucrats would act irresponsibly – they are not checked by profit and loss accounting. Since public services lack a cash value as generated by markets the costs of increasing public services are unknown. Bureaucratic managers would thus over expand their operations without realizing it.
Such bureaucratic excesses must be limited by restrictive rules. Hence bureaucracies lack the flexibility of entrepreneurial capitalism. Bureaucracy is the shortest and surest path to understanding the merits of free markets and the dangers of socialism.’ Dr Doug Mackenzie
1996, 1969, 1944, Published by Libertarian Press Inc, ISBN 0-910 88434 X, 138pp