Rethinking economic planning

Abstract

The special issue ‘Rethinking Economic Planning’ contributes to the emerging literature on economic planning in the age of digitalization and climate crisis. This introduction will first situate the new planning debate in the context of the historical socialist calculation debate. We will then provide an overview of the current literature on democratic economic planning, elaborate on the contributions of this special issue and its individual papers against this background, and summarize the six texts. We close with a brief section on gaps in the debate.

The return of planning

The long decade since the North Atlantic Financial Crisis, increasing awareness of approaching ecological disaster and the COVID-19 pandemic have clearly illustrated the multiple contradictions of capitalist market societies in the age of late neoliberalism. The parallel crises of finance, social reproduction, democracy, geopolitics, and the social metabolism have given rise to notions of a ‘polycrisis’, meaning a series of heavily interrelated crises whose collective impact is larger than the sum of its parts (Tooze, 2022). It is thus not surprising that new academic and political debates have started to discuss economic and social alternatives to financialization, neoliberalism, and capitalism more generally (Adamczak, 2021; Adler, 2019; Arruzza et al., 2019; Fraser, 2020; Hahnel and Wright, 2016; Hester and Srnicek, 2023; Malleson, 2023; Mazzucato, 2021). Some of these centre on contested techno-politics in the age of digitalization (Rifkin, 2014; Srnicek and Williams, 2015). Others have suggested varieties of Green New Deals (Klein, 2019; Riexinger et al., 2021; The Red Nation, 2021) or post-growth economies (Hickel 2020; Kallis, 2018; Raworth 2017; Schmelzer et al., 2022) as a solution to impending ecological disaster.

Most recently, this turn towards broader discussions of alternative futures has frequently been complemented by a controversial but increasingly popular topic: democratic planning as an alternative to market-based allocation (e.g. Durand et al., 2023; Foster, 2023; Groos, 2021; Groos and Sorg, 2025; Hahnel, 2021; Jones, 2020; Laibman and Campbell, 2022; Morozov, 2019; Pahl et al., 2024; Sorg; 2023a, 2023b; Beckmann et al., 2024). The special issue ‘Rethinking Economic Planning’ contributes to this emerging literature on economic planning in the age of digitalization and climate crisis. This introduction will first situate the new planning debate in the context of the historical socialist calculation debate. We will then provide an overview of the current literature on democratic economic planning, elaborate on the contributions of this special issue and its individual papers against this background, and summarize the six texts. We close with a brief section on gaps in the debate.

Markets and planning: Historical perspectives

The respective strengths and weaknesses of markets and planning and the question of whether economic planning on the scale of an entire economy is possible and desirable have been discussed throughout the 20th century in what has been termed the socialist calculation debate. The debate mainly featured Austrian, Marxist, and neoclassical economic theorists, the latter in turn being divided into socialist and non-socialist neoclassical economists. The traditional narrative of the debate holds that it started when Austrian economist Ludwig von Mises ([1920] 1990) published a critique of the Otto Neurath’s ([1919] 1973) proposal for a form of moneyless (‘in kind’) economic planning based on the experience of war-time economic planning. Von Mises asserted that in the absence of private property and a free market for factors of production, socialist planning would struggle to engage in rational economic calculation. Socialist economists soon rediscovered Enrico Barone’s ([1908] 2012) suggestion that if an economy can be displayed as a system of equations, economic planning could in principle be conducted by solving these equations. The ground of the debate thus shifted from whether planning was theoretically possible to whether it was feasible in practice to solve the enormous number of equations in time. With neoclassical socialists Oskar Lange and Fred Taylor (1938) suggesting that a planning board could set the prices of capital goods and adjust them in response to excess supply or demand, and with the computer on the horizon to ‘obtain the solution in less than a second’ (Lange, 1979), most contemporary economists (e.g. Bergson, 1948) concluded that socialist planning was indeed practical.

In his highly influential 1948 introduction to economics, for instance, neoclassical economist Paul Samuelson (1948: 590ff) used a model similar to Lange’s to illustrate among other things ‘a possible method of attacking the almost unbelievably complex problem of socialist economic planning’. He did not assume that mathematicians will ‘have to be called in to solve thousands and thousands of simultaneous equations’, because ‘the decentralized planners would proceed by successive approximation, by trial and error’ instead (Samuelson, 1948: 602). Joseph Schumpeter (2003: 188) in 1942 argued along similar lines that there ‘is nothing wrong with the pure logic of socialism’, a fact he considered ‘so obvious that it would not have occurred to me to insist on it were it not for the fact that it has been denied and the still more curious fact that orthodox socialists, until they were taught their business by economists of strongly bourgeois views and sympathies, failed to produce an answer that would meet scientific requirements’. Schumpeter claimed that socialist planning was not only theoretically possible, but indeed practically feasible, because a planning agency ‘would command information sufficient to enable it to come at first throw fairly close to the correct quantities of output in the major lines of production, and the rest would be a matter of adjustments by informed trial and error’ (Schumpeter, 2003: 185).

Against the background of the crises of Western Keynesianism, Southern Developmentalism, and Eastern state socialism and the related rise of neoliberalism since the 1970s, Austrian economists (e.g. Kirzner, 1988; Lavoie, 1985) managed to successfully transform this narrative of the debate (Adaman and Devine, 1996; O’Neill, 1996). They argued that socialist neoclassical economists had fundamentally misunderstood the Austrian challenge to planning, which they argued ¹ had always centred on the discovery and mobilization of ‘tacit knowledge’, most forcefully articulated by Friedrich August Von Hayek (1945). Such knowledge was dispersed among different actors, embodied in time and place and thus could not simply be aggregated by central planners. Instead, they argued, tacit knowledge required free entrepreneurs to act on it. The terrain of the debate thus shifted from what were essentially questions of computation to questions of knowledge, with most economists now being increasingly sceptical about the prospects of encompassing economic planning (on this shift in historiography: Lavoie, 1985; O’Neill, 1996; Adaman and Devine, 1996). Even critics of capitalism grew increasingly pessimistic about planning and instead suggested different models of market socialism (e.g. Roemer, 1994; Schweickart, 2002) as the politics of ‘feasible socialism’ (Nove, 1983). They conceded the market as a superior form of social mediation but maintained that it was possible to combine it with worker self-management of workplaces.

This period constitutes the prelude for the present-day wave of the socialist calculation debate. It was in explicit contrast to market socialist ideas that a series of new models of democratic economic planning emerged, which have only very recently been rediscovered by a broader audience. These models maintained that democratic economic planning as a third alternative to market economies (including socialist ones like in Yugoslavia) and statist command economies remained possible. The first of these models was Pat Devine’s (1988) notion of ‘negotiated coordination’, which stresses the need to replace atomistic decision-making on investment with deliberation by representatives of the major groups affected by a decision. In his model, market exchange between different cooperatives would generate the necessary qualitative and quantitative information for non-market deliberation over societal priorities and investment decisions. Michael Albert’s and Robin Hahnel’s (1991) ‘participatory economics’ approach suggested a libertarian model of participatory planning, in which worker and consumer councils, respectively, determine societal supply and demand in a bottom-up process. After the councils have suggested plans for societal supply and demand, a technical Iteration Facilitation Board would adjust prices based on these plans and thus facilitate an iterative process of finding an equilibrium between supply and demand. A third and much less libertarian ‘cyber-socialist’ model has been suggested by Paul Cockshott and Allin Cottrell (1993), who argue for computerized central planning. Digitally connected workplaces communicate required inputs and production capacities to a central planning agency, which uses this information to optimize economic production via linear programming and thus produce options for economy-wide plans. These are in turn subjected to referendums. Fourth and final, David Laibman (1992, 2002) has developed a model that he calls ‘multilevel democratic iterative coordination’ (MDIC) in which democratic coordination is achieved through a continuous multilayered feedback process between decentralized units with locally embedded knowledge and a democratically legitimized centre with system-level knowledge of interdependencies. In order to maximize local autonomy of workplaces, he argues that the main task for the centre is to aggregate information and use it to centrally plan prices in a way that aligns the particular interests of workplaces with societal interests.

The digital and ecological calculation debate

The height of neoliberal hegemony greatly decreased interest in planning and these approaches to democratic planning, developed during the ‘end of history’ (Fukuyama, 1992), were thus only discussed at the margins of social science (Science and Society, 1992, 2002, 2012). However, the escalating polycrisis has recently reignited interest in non-market forms of social mediation and coordination and also in the possibility of democratic economic planning. The new debate can roughly be divided into three broader themes: planning in capitalism, digital planning, and ecological planning.

The first major theme is the observation that ‘planning is already endemic to capitalism’ (e.g. Bensussan et al., 2023; Braun, 2018, 2022; Jochum and Schaupp, 2022; Jones, 2020; Philipps and Rozworski, 2019; Rikap, 2022; Sorg, 2023b). The historical increase of deliberate corporate planning within companies vis-à-vis market competition between them has been observed by a variety of renowned economists and social scientists from different backgrounds (e.g. Coase, 1937; Schumpeter, 2003; see; Simon, 1991; Sorg, 2023a). There have been similar arguments about increases in government size and capacity over time, with regard to the size of hegemonic state formations in different historical periods (Arrighi, 2007) and to the drastic increase in public planning after World War II (e.g. Devine, 1988; Krippner, 2011).

Novel bodies of academic literature have recently observed new transformations in both corporate and public planning. While some more popular work has discussed the emergence of large-scale procurement and distribution networks such as Walmart or Amazon as a significant advance in distributive planning (Jameson, 2009: 420ff; Bratton, 2016: 327ff; Phillips and Rozworski, 2019), work in economic and industrial sociology has discussed related transformations under the banner of intellectual monopoly capitalism (Pagano, 2014; Durand and Milberg, 2020; Rikap, 2022). The decline of mid-20th-century vertically integrated corporations (Chandler, 1977) had created the appearance of a shift from bureaucratic corporate planning to flexible and networked market exchange (Piore and Sable, 1984). However, leading firms maintained firm control over their supply chains (Arrighi, 2007: 170), and new technologies such as logistics and supply chain management software, satellite communications, and the Internet provided new ways for them to meticulously plan along global value chains (Bensussan et al., 2023).

Likewise, the new state capitalism literature has argued that public planning is on the rise across the globe (Alami and Dixon, 2020; Alami, 2023; Alami and Dixon, 2023). However, the concept lacks a common definition and is thus employed quite differently, for instance, to describe a particular variety of capitalism or the expansion of state-owned enterprises, among others (Alami and Dixon, 2020). Despite these conceptual differences, empirical observation of the state capitalism literature strongly indicates a shift in state-market relations towards more public planning via industrial policy, sovereign wealth funds, and public development banks (Alami and Dixon, 2020). Other research has also pointed to an increasing return of industrial policy (Evenett et al., 2014; Wigger, 2023), especially against the background of the US Inflation Reduction Act (Riley and Brenner, 2022), the European Green Deal (Pianta and Lucchese, 2020), and the rise of China (Baltz, 2022). Still other work in financial sociology has pointed to the increasing role of ‘central bank planning’ (Braun, 2018, 2022) and ‘macrofinancial regimes’ (Gabor and Braun, 2023) in shaping public planning (see Sorg, 2023b, in this special issue).

It is important to note here that observations of increasing corporate planning and public planning in capitalism have generally not related one to the other, and neither of them have been generally related to previous and current debates about the possibility of post-capitalist planning (as a notable exception: Bensussan et al., 2023). There thus remains space for research that analyzes these transformations from organizational sociology’s foundational departure point, which is that modernity has been characterized by a huge increase in the size and capacity of (both public and private) organizations (Fligstein, 2021).

A second theme of the new planning debate is the question of whether digital technologies can be of help in making new forms of democratic economic planning possible (Groos and Sorg, 2025; Heyer, 2025; Rief, 2023; Sorg, 2023a). In exploring the possibilities of post-capitalist and democratic varieties of planning, these works have rediscovered the older models of democratic planning elaborated in the previous section against the background of new digital technologies. While early ideas included the use of semi-autonomous software agents for developing economic plans (Dyer-Witheford, 2013), newer approaches explore the potential of forecasting technologies to determine demand (Grünberg, 2023a). While there are still those who work in the centralist tradition of the approach laid out by Cockshott and Cottrell (Dapprich, 2022), most approaches have looked towards digital technologies less in terms of computing power for central planning, but for their capacity as networked media of coordination that could bring about alternatives to market-based solutions.

Situated at the intersection of economics, computer science, and science and technology studies, such scholars have discussed whether information-rich feedback signals in combination with cybernetic principles of organization could promise an alternative to the information-poor price system of the market economy (Bratton, 2016: 327ff; Morozov, 2019; Swann, 2021; Jochum and Schaupp, 2022). Others have developed new models that explicitly make use of new digital possibilities, such as the use of digital platforms to mediate between economic actors (Saros, 2014), or the use of digital technologies to enable a commons-based form of planning (Meretz and Sutterlütti, 2025) that relies on stigmergic signals as an important coordinating mechanism. In contrast to approaches that search for digital methods of mediating between a given supply and demand, Evgeny Morozov argues that the true challenge for digital technologies within the planning debate revolves around the ability to devise alternative mechanisms for producing the new (Morozov and Groos, 2025).

In contrast to the notion that digitalization makes encompassing economic planning feasible, the third theme has complemented the debate with the idea that climate disaster and the loss of biodiversity make planning necessary to avoid ecological breakdown (Felli, 2019; Malm, 2021; Saitō, 2022; Vettese and Pendergrass, 2022; Planning for Entropy, 2022; Krahé, 2022; Durand et al., 2023; Foster, 2023; Nishat-Botero, 2024; Dyer-Witheford, 2025; Hofferberth et al., 2025). Some authors have argued that the rapid and substantial price adjustments necessitated by climate change would render market mechanisms dysfunctional and thus require planning (Krahé, 2022). Others have called for ‘democratic planning’ in order to, among other things, ‘scale down ecologically destructive and less-necessary forms of production to reduce excess energy and material throughput in the core’ (Hickel and Sullivan, 2023). Along similar lines Durand et al. (2023) stated that if post-growth economies are to be achieved ‘by design not by disaster’, there will be a need for planning to set ecological limits, share restorative labour equitably, retire entire industries and instead divert resources into sustainable sectors. Other authors have rediscovered war economies as potential models for eco-planning (Malm, 2020; Saitō, 2022).

Of course these three themes are not meant to be either exclusive or exhaustive. Many texts in the new debate on economic planning discuss more than one of these topics, while others cover issues that fit none of the categories. The latter include questions of investment (Benanav, 2022), socialist governmentality (Groos, 2025), trans- and international dynamics (Sorg, 2025, see also Elias-Pinsonnault et al., 2023, in this special issue), post-sovereign planning (Mohammed, 2025), commonist planning (Meretz and Sutterlütti, 2025), reproductive planning in a liberated society (Lutosch, 2025), planning and anarchy (Bernes, 2020), biocommunist planning (Dyer-Witheford, 2025), and more. The six articles in this special issue (Elias-Pinsonnault, 2023; Grünberg, 2023b; Nardelli et al., 2023; Rochowicz, 2024; Sorg, 2023b; Thompson and Nishat-Botero, 2023) similarly build on and contribute to the existing themes of the new planning debate, while uncovering roads less travelled. The first three papers engage with more traditional themes of the socialist calculation debate such as investment, calculation, and innovation. The second half of the issue then complements this largely economic focus with political, social, and ecological considerations. Throughout the special issue the reader will encounter both forms of planning within capitalism and theories of post-capitalist planning. At the same time, they will find papers zeroing in on single themes that have so far not received sufficient attention in the planning literature. These hitherto underexplored issues include questions of transformation, innovation, international planning, space and the urban, the intricacies of optimization algorithms, and cyber-physical systems.

The special issue makes two other significant academic contributions. First, questions of planning have been tremendously understudied in sociology, political economy, and business and management studies in recent years. The interdisciplinary focus on the predominance and hegemony of market forces is understandable considering several decades of neoliberal transformation but has rendered illegible the degree to which different forms of planning continue to be endemic to capitalism. Second, the texts contribute to a ‘normatively grounded sociology [and by extension academia] of the possible, not just the actual’ (Wright, 2013). They question current institutional arrangements and thus open a critical conversation on the merits and shortcomings of different social systems. This appears to be a timely endeavour in times of an escalating polycrisis.

The papers

Christoph Sorg’s contribution discusses a series of dispersed and undeveloped claims in the planning debate that finance plays a significant and increasing role in economic planning within capitalist systems. After suggesting a way to conceptualize planning in market economies and situating the role of finance within it, the paper then elaborates how financialization has significantly shaped both public economic planning for overall accumulation within a given territory and private economic planning of companies for individual profits. Drawing on insights from the democratizing finance literature, the text then builds a bridge to discussions about post-capitalist planning. In doing so it discusses finance’s capacity for economic coordination and argues that said capacity for steering makes it a potential tool for transformation towards increased social and democratic control over the economy. The text closes with some reflections on trajectories of transformation, which remains a pivotal gap in the planning debate, given the latter’s strong focus on models and theories of post-capitalist planning.

The paper by Sorg introduces the important distinction between ‘static planning’ as allocation based on existing productive capacity and ‘dynamic planning’ as the transformation of said capacity. While Sorg’s focus on finance leads him to concentrate mainly on the latter, the paper by Max Grünberg shifts the focus to the former. It identifies five suggested strategies for static planning in the literature and argues that algorithmic mediation is the only potential candidate for dealing with high complexity. Grünberg then introduces the historical background of optimal planning and the shortcomings of Soviet command planning, thus laying the foundation for further reflection on algorithmic coordination. He identifies four key challenges that optimal planners would encounter: computational complexity, the need to generate the necessary economic data, the difficulty of reconciling static optimal solutions with dynamic real-world economies, and the question of whether an optimal planning framework can effectively address both the economic and political issues that plagued the Soviet system.

Mirroring the historical trajectory of the socialist calculation debate elaborated above, the third paper by Nils Rochowicz moves the focus from computation and calculation to innovation and discovery. It follows Morozov in arguing that the pivotal hurdle for proponents of democratic economic planning is to devise a framework that matches the market economy’s capacity for innovation and dynamism (Morozov and Groos, 2025). Rochowicz examines three existing proposals for integrating innovation into planning models, assessing their compatibility with empirical evidence on technological progress and the normative and political objectives that planning proposals should meet. These include the coordination of interdependent investment via negotiation, investment councils, and mission-oriented innovation. Rochowicz evaluates whether these models can serve as the foundation for generating innovation within a planning framework and in doing so builds not only on their benefits and shortcomings but also on insights from the literature on the economics of innovation and technology prediction. He then presents a model for institutionalizing innovation in a manner that rivals market economies. His model revolves around two primary elements: accelerated, democratic missions to identify demand for particular forms of innovation, and the careful selection and screening of promising new technologies to fuel the supply side of innovation.

The paper by Sophie Elias-Pinsonnault, Mathieu Dufour, and Simon Tremblay-Pepin also critically reviews models in the planning literature but shifts the focus from innovation to the international realm. This is an important contribution, given that existing approaches are characterized by a methodological nationalism that has so far understudied relations between and beyond national political territories (Sorg, 2025). The authors first review whether and how existing models conceptualize international economic relations. They then outline a set of principles for the international relations of democratically planned economies. Two of the principles (autonomy and efficiency) are inspired by the literature review, but the authors complement them with three other variables: multifactoriality, transparency, and cooperation. Finally, they illustrate how these principles could work in practice in the case of a small open economy, concluding that an international interface can be integrated into a multidimensional accounting system.

Matthew Thompson and Yousaf Nishat-Botero examine the literature on democratic economic planning against the background of space and urban dynamics, drawing from Henri Lefebvre’s ideas on planetary urbanization and space production. They highlight a tendency in the planning literature to prioritize overcoming abstract labour time over abstract space, thus hindering a full understanding of capitalism’s urban manifestations and its potential transformation. By considering recent critical discussions on the logistics revolution and the logistical state, their article suggests that postcapitalist planning will emerge from urban struggles over everyday life. It advocates for future research to focus empirically on urban struggles, recognizing the urban as a key mediator of capitalist relations, and to draw inspiration from historical and contemporary municipalist movements that aim to reimagine communal structures.

Pedro HJ Nardelli, Pedro E Gória Silva, Harun Siljak, and Arun Narayanan present a decentralized planning framework based on insights from value-form theory and commoning as an alternative to both central planning and markets. They conceive their model as a cyber-physical system, aimed at coordinating production and distribution without reliance on money or other capitalist social forms. In doing so the authors offer a tangible technical blueprint for a prospective society founded on principles of communal ownership, polycentric, and shared resource allocation. They specifically stress the benefits of decentralized planning via cyber-physical systems for pivotal economic sectors such as energy, logistics, industry, and agriculture. The paper concludes with a case study of the moneyless decentralized organization of electrified energy systems.

Themes and outlook

While this special issue contributes to a broad range of themes, it nonetheless reproduces a couple of gaps that are also common in the larger planning literature, including questions of transformation, social reproduction, and Southern perspectives.

Transformation: with most of the planning literature focusing on theories and models of post-capitalist planning, future research needs to engage with research on and practices of contentious politics and social movements, especially with regard to their relationship to social, political, and economic planning (Redecker and Groos, 2025). What are the forms of social coordination that movements for decommodification, climate justice, the recognition of care work, solidarity economy, or platform cooperativism envision? How do heterodox bodies of knowledge production such as modern monetary theory or degrowth think about planning? Future research may interrogate these proposals, movements, and schools of thought in view of their positions on economic planning and ask how they challenge current forms of economic planning. They may also elaborate what interstitial, ruptural, or symbiotic trajectories (Wright, 2010) towards more democratic forms of planning could look like.

Social reproduction: the origin of the planning debate lies in the question of whether democratic coordination and planning can replace the market forces that govern relationships among companies and between the economic and political sphere. At the same time, most models of post-capitalist planning have constituted encompassing models of a post-capitalist social order. There has thus been an economist and class-reductionist tendency to identify theories of post-capitalism with the abolition of markets in the ‘productive sphere’, thereby largely excluding perspectives on waged and unwaged forms of reproductive labour. Despite a series of critical interventions (e.g. Fraser and Sorg, 2025; Lutosch, 2025; Mohammed, 2025; Sorg, 2023) and constructive proposals for democratically planned reproduction (e.g. Bohmer et al., 2020), the planning literature has yet to fully integrate the insights coming from feminist perspectives on post-capitalism (e.g. Hester and Srnicek, 2023; Lewis, 2021, 2022) that centre among other things on critiques of the family-form, suggestions for communal care, and post-work notions of social reproduction. Future research will need to acknowledge that a tremendous share of socially necessary work is currently conducted in households and thus rendered invisible by the planning literature’s focus on the production of goods.

Multiple pasts, presents, and futures of planning in the Global South-East: there is an unfortunate gap between the current Eurocentric debate on digital planning and the plural Southern histories and presents of economic planning, which features not only Chile’s Cybersyn project (Medina, 2011) but also Yugoslavian and Arab Socialism, the Latin American Pink Tide, varieties of Asian indicative planning, Indian development planning, participatory planning in Kerala, and visions of a New International Economic order, among others (Bettelheim, 1974; Chakravarty, 1993; Patnaik, 1998; Mannathukkaren, 2010; Pierzyńska, 2012; Weber, 2021; see also: Sorg, 2025). The experience of colonialism and imperialism has always countered hegemonic discourses of capitalist free markets versus socialist planning, with core states using political and military power to subsidize industries while prohibiting peripheral states from equal access to Northern markets. Future research needs to draw on insights from these experiences and may discuss or compare particular case studies of planning, elaborate the possibility of democratic planning on a world scale, or focus on the colonial and imperial legacies any project of democratic planning would have to grapple with. Contributions could also identify notions of planning in debates about delinking and auto-centred development, the Non-Aligned Movements, and contemporary South-South collaboration, thus spelling out trajectories for democratic global coordination to originate in the Global South.