COMPUTATIONAL CONTROVERSIES IN DISEQUILIBRIUM AND SHORTAGE MODELLING OF CENTRALLY PLANNED ECONOMIES

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Abstract
Most disequilibrium and shortage models of centrally planned economies fall into three categories: testable excess demand (the Portes school), disequilibrium indicators, and Kornai's economics of shortage. These models have generated numerous controversies and conflicting empirical results. However, this paper argues that some disputes are not caused by the theoretical features of the models but rather by the utilisation of different estimation methods that are not directly comparable. This suggests that several controversies are more apparent than real and can be resolved through the improvement of computational techniques and statistical hypothesis testing theory.