This is the seventh part of ten extracts from the book Democratic Economic Planning (2021, Routledge) by Robin HahneI. How can longer-term investment and development planning be organised, carried out, and integrated in order to maximise democratic participation and efficiency?
Introduction to Part IV
We have covered a lot of ground. We have explained how a participatory economy “works,” what we believe are its many advantages, and responded as best we can to a number of questions and criticisms others have raised over the past 30 years. However, we have yet to talk about any of the decisions most economists consider when they think about economic planning!
We have discussed how worker and consumer councils and federations can create a feasible, efficient, annual plan themselves to coordinate their interrelated economic activities, rather than relegate coordination to market forces or a central planning bureau. But we have yet to talk about planning for the future. We have yet to talk about how to plan investment – producing capital goods instead of consumption goods in order to be able to produce even more goods in the future. We have yet to talk about investing in various kinds of infrastructure necessary to support a great deal of economic activity in modern economies. Nor have we discussed different kinds of long-term, development planning. How do we propose to do what used to be called “manpower planning,” but is now better known as education planning – that is, investing in both formal and informal education and training programs to teach people the skills they need to perform at their best? How do we propose to do environmental planning and protect the environment from deterioration that unfairly harms future generations? How do we propose to do long-run, strategic international economic planning to change a country’s patterns of international trade and investment? And how do we propose to integrate all these kinds of planning that cover different time periods?
Investment and development planning over many years raise new issues and problems. In Parts IV and V, we propose how all these kinds of planning can be organized, carried out, and integrated in order to maximize democratic participation and efficiency. Here, in Part IV, we discuss participatory investment planning – first in Chapter 11 in a simple, single-good context sufficient to explore key issues about deciding on the appropriate level of aggregate investment, and then in Chapter 12 in a multi-good world where decisions must be made about how much of different capital goods to produce and how to distribute them among different firms in different industries. In Part V we discuss three different kinds of long-run development planning. In Chapter 13 we treat participatory educational planning, in Chapter 14 we take up participatory environmental planning, and in Chapter 15 we tackle participatory international economic planning, followed by an appendix to Part V, where we discuss infrastructure planning. We will discover that all these different kinds of plans, concerning different aspects of how people want their economy to “develop” over time, have some things in common as well as some unique problems to be addressed.