In the ideal market of general equilibrium theory, choices are made in full knowledge of one another and all expectations are fulfilled. This pre-harmonization of individual plans does not occur in real-world markets where decisions must be taken in ignorance of one another. The Austrian school grants this, but claims that real-world price systems are nonetheless effective in coordinating saving and investment decisions, which are motivated by disparate considerations. In contrast, Keynes held that without the pre-reconciliation of individual plans, investment and employment would be less than optimal, and the resulting distribution of income arbitrary and inequitable.
