2 , The debate over the role of the government The government 's role imeconomic management remains an unre solved issue in the current discussions of economic policy . The debate began ' n " the early twentieth century , particularly in context argument over socialist economic calculation , and was led by Ludwig von Mises , Oscar Lange , Friedrich von Hayek , and the Austrian School . Mises argued that rational economic management I n socialist economy is impossible because of absence of market and pric e mechanisms , Lange disagreed with . Mises , offering his concept market socialism , Lange contended that central planning board can substitute for a market - or price mechanism and resolve decentralized resource allocation problems . Lange 's planning board would be ableto search for the optimal allocation or discover an equilibrium price vector either through trialand error or a process of successive approxi mation . Later , Hayek ( 1948 ) joined the debate , contributing to the rising prominence of the Austrian School as well as to the development of the concept of market competition - dynamic discovery proce - dure . Although Hayek recognized the theoretical possibility of econ - omic calculation by the central planning board in the socialist economy . he doubted whether such system would work practically because - of the excessive information requirements . In the Hayeklan world , no manmadC system can discover optimal outcomes of resource allocation without a process of dynamic competition