The information problem for a central planner refers to the fact that he/she may not always know how to allocate resources to their highest value use.

Question

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The information problem for a central planner is one of the key criticisms of centrally planned economies. It refers to the fact that in a complex economy, it may be difficult for a central planner to have the information necessary to make perfect allocation decisions. This can result in inefficiencies and misallocation of resources.

The Information Problem for a Central Planner Refers to the Fact