Is there any knowledge about the price mechanism

Pricing mechanism

Market price mechanism; Name for the principle of horizontal coordination of economic plans on decentralized markets, where the price can form as a result of the interplay of supply and demand free of direct state influence. Nevertheless, there are state-set framework rules (e.g. in the form of commercial law) for transactions on markets. The coordination is the result of the interaction of the coordination mechanisms negotiation, competition, contract and exchange. In contrast to macroeconomic planning, there is no central authority that determines the flow of goods and resources. Rather, these arise indirectly as a result of the economic activity of a large number of economic subjects. The price mechanism is the dominant form of coordination of economic processes in the market economy. By fulfilling the price functions, the price mechanism leads to a coordination of economic activities within the entire economy. It ensures that the interdependencies between the various markets flow into the calculation of the individual economic subjects and thus lead to an optimal allocation of resources. In markets that are characterized by market failure, however, the price mechanism cannot or not satisfactorily fulfill its functions and must then be supplemented by other forms of economic coordination, e.g. by state intervention. Eucken sees a functioning price mechanism as an essential prerequisite for the functioning of the transport industry. However, their existence is tied to a number of other constituent principles (see Freiburg School).