1945] HAYEK:THE USE OF KNOWLEDGE IN SOCIETY 525 solely on the basis of his limited but intimate knowledge of the facts of his immediate surroundings.There still remains the problem of communicating to him such further information as he needs to fit his decisions into the whole pattern of changes of the larger economic system. How much knowledge does he need to do so successfully?Which of the events which happen beyond the horizon of his immediate knowledge are of relevance to his immediate decision,and how much of them need he know? There is hardly anything that happens anywhere in the world that might not have an effect on the decision he ought to make.But he need not know of these events as such,nor of all their effects.It does not matter for him wky at the particular moment more screws of one size than of another are wanted,why paper bags are more readily available than canvas bags,or why skilled labor,or particular machine tools, have for the moment become more difficult to acquire.All that is significant for him is how muck more or less difficult to procure they have become compared with other things with which he is also con- cerned,or how much more or less urgently wanted are the alternative things he produces or uses.It is always a question of the relative importance of the particular things with which he is concerned,and the causes which alter their relative importance are of no interest to him beyond the effect on those concrete things of his own environment. It is in this connection that what I have called the economic calculus proper helps us,at least by analogy,to see how this problem can be solved,and in fact is being solved,by the price system.Even the single controlling mind,in possession of all the data for some small,self- contained economic system,would not-every time some small adjust- ment in the allocation of resources had to be made-go explicitly through all the relations between ends and means which might possibly be affected.It is indeed the great contribution of the pure logic of choice that it has demonstrated conclusively that even such a single mind could solve this kind of problem only by constructing and constantly using rates of equivalence (or "values,"or "marginal rates of substitution"),i.e.,by attaching to each kind of scarce resource a numerical index which cannot be derived from any property possessed by that particular thing,but which reflects,or in which is condensed its significance in view of the whole means-end structure.In any small change he will have to consider only these quantitative indices (or "values")in which all the relevant information is concentrated;and by adjusting the quantities one by one,he can appropriately rearrange his dispositions without having to solve the whole puzzle ab initio,or without needing at any stage to survey it at once in all its ramifications