Lindblom - The Market System - Afghan Journalists' Committee

Market-System Coordination 49Diffusion of participation and control. The market systemis remarkable—unique, I think one can say—in its extremediffusion of participation and control. Among the billionsof persons coordinated by the market system, all sharein control over it. Although entrepreneurs are far more influentialparticipants, they are not the only ones who exercisecontrol. You and I and every buyer also do so. So doeseveryone who offers a performance for a wage or fee. One“votes” through one’s spending, thus creating a massivecontrolling influence. Market “voting” has a far higher rateof participation than can ever be achieved in democraticballoting. Among those coordinated no one is inactive or apassive nonparticipant; there are no nonvoters.Simplicity of decision problems. Although entrepreneurialproblems, especially in a big corporation, may appeardaunting, they are small when compared with the problemsof efficient choice when faced by central planners. Markettransactions resolve questions over the distribution of income,the rate of investment, and the allocation of the laborforce, yet no decision maker has to face such problems. Acorporate executive does not have to decide how to best allocatesteel for society but only whether the enterpriseshould buy it, sell it, or make it. And in coping with suchchoices with the benefit of efficiency prices, the executivecan measure, make estimates, and obtain feedback.Coordination of conflicting sets of preferences. Marketsystemcoordination is remarkable in solving a mammothproblem posed by a discrepancy between two always presentdesired patterns of coordination. Imagine a societywhose rulers or voters wish to put 40 percent of the workforceinto heavy industry, like steel and automobiles, butno more than 20 percent want to work in heavy industry.How to reconcile the two patterns? Conscript the necessary