David Prychitko, Markets, Planning and Democracy:
Essays after the collapse of communism.
Cheltenham, UK: Edward Elgar, 2002, Bibliography
and index. pp 190.
Published online: 7 April 2007
Springer Science + Business Media, LLC 2007
David Prychitko’s Markets, Planning and Democracy marks a significant step forward in
developing Austrian theory. Based on Mises’ argument that only markets enable economic
calculation to encompass the complexity of modern society and Hayek’s insight that the
“knowledge problem” is the central issue in understanding societies, the Austrian approach
raises different questions than neoclassical theory. Prychitko’s work elaborates some
implications of this difference and, along the way, offers strong criticisms of neoclassical
approaches to similar issues.
The volume collects essays published over a 12-year period, many slightly modified for
this volume. Given that some deal with policy challenges important in a time now past,
such as Yugoslavia’s struggle with immediate postcommunist realities, they might seem
dated. I disagree. The test of good analysis is how well it comprehends the complexities of
actual political and economic events, and the passage of time offers a decisive check.
Prychitko passes with flying colors.
The book is divided into two parts: one part on essays dealing with issues in “economic
democracy” and another, less focused, on projects for reform within explicitly market
contexts. The author’s sensitivity to the economic and social relations manifesting within
the overall context of the market order is a connecting thread. I find this approach valuable.
Much analysis by Austrians and non-Austrians alike proceeds at such abstract levels that
the human dimension can virtually disappear, a problem that Prychitko criticizes. Another
quality throughout is Prychitko’s respectful tone when criticizing those with whom he
In his section on economic democracy, Prychitko focuses on Marxists’ attempts to adapt
to a postcommunist world. Of particular importance is his sensitivity to the full complexity
of Marxist analysis, particularly those characterizing Yugoslav thinkers. “Marx and
Decentralized Socialism” explores efforts to replace the “alienation” of market prices with
“relational” dialogic models. These efforts run afoul of central Austrian insights for “It is
simply absurd to condemn market prices for not exposing all the intimate details of
Rev Austrian Econ (2007) 20:209–211
G. diZerega (*)
Department of Government, St. Lawrence University, Canton, NY 13617, USA