Question: Most observers agree that centrally planned economies fail because it
Most observers agree that centrally planned economies fail because it is impossible for bureaucrats in large government hierarchies to coordinate different sectors of an economy as efficiently as market mechanisms do. Many diversified firms, however, are as large as some economies and use private sector hierarchies to coordinate diverse business activities in a firm. If you do not consider these large private sector hierarchies as different from the government hierarchies of centrally planned economies, then why do they continue to exist?
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