Other Definitions
allocation (dict)
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AllocationThe allocation of production and consumption is a key element of any model of economics. The most common allocation mechanisms include centralised mechanisms as in communism and corporations, or market based mechanisms as in capitalism. Market based mechanisms include positive and negative feedback loops to mismatches in demand and supply, but ignore a large number of parameters representing social and moral values and empirical behaviour, which most empirical sociology and psychology research show to be very resistant to quantification as monetary values. Alternative allocation mechanisms, which could incorporate non-monetary values by the means of rational, informed debate and decision making, and could be both decentralised and participatory, and could involve localised positive and negative feedback loops where groups of people active in their roles of either producers or consumers would make general proposals regarding production or consumption respectively. In the participatory economics model, the positive and negative feedback are provided by a third group of people which would iterate between the proposals of the producers' and consumers' groups. Other alternative allocation mechanisms most likely exist, since the parameter space has a large number of dimensions.
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