“Competition as a Discovery Procedure.” New Studies in Philosophy, Politics, Economics and the History of Ideas. London: Routledge & Kegan Paul, 1978.

Excerpt:

“It is difficult to defend economists against the charge that for some 40 to 50 years they have been discussing competition on assumptions that, if they were true in the real world, would make it wholly uninteresting and useless. If anyone really knew all about what economic theory calls the data, competition would indeed be a very wasteful method of securing adjustment to these facts. It is thus not surprising that some people have been led to the conclusion that we can either wholly dispense with the market, or that its results should be used only as a first step towards securing an output of goods and services which we can then manipulate, correct, or redistribute in any manner we wish. Others, who seem to derive their conception of competition solely from modern textbooks, have not unnaturally concluded that competition does not exist.
Against this, it is salutary to remember that, wherever the use of composition can be rationally justified, it is on the ground that we do not know in advance the facts that determine the actions of competitors. In sports or in examinations, no less than in the award of government contracts or of prizes for poetry, it would clearly be pointless to arrange for competition, if we were certain beforehand who would do the best. As indicated in the title of this lecture, I propose to consider competition as a procedure for the discovery of such facts as, without resort to it, would not be known to anyone, or at least would not be utilized.”

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