Executive VP & COO, Allstate
Search every verified Mario Rizzo interview, podcast appearance, and on-the-record quote — each transcript cross-checked by AI and human review to confirm speaker identity. Mario Rizzo, Executive Vice President and Chief Operating Officer at Allstate, delivered a lecture on August 3, 2010, at the Foundation for Economic Education seminar "Advanced Austrian Economics," which was published online in 2019. In the lecture, Rizzo discussed economic concepts related to time, competition, and coordination, drawing on the ideas of economists such as Friedrich Hayek and Ludwig von Mises. He argued that competition is a process of discovery that produces novel and unpredictable outcomes, contrasting this with the traditional view of competition as a computational process that enforces equilibrium. Rizzo stated that attempts to guarantee people's expectations about market values would disable the discovery process responsible for coordinating economic activities. Rizzo also addressed the relationship between entrepreneurship and unpredictability, saying that the same factor responsible for adjusting to disequilibria—entrepreneurship and discovery of opportunities—also produces unpredictability, making coordination and unpredictability mutually connected in the real world. He suggested that good plans allow flexibility to change when something unexpected happens, and that better than maximizing profit is planning to survive over the long run by avoiding outcomes that knock a firm out of business. Rizzo noted that Hayek preferred the concept of order over equilibrium, describing it as "like a stream flowing with some attention to its banks."
“Competition produces things which are novel, unpredictable; some expectations are disappointed because other market participants don't realize changes, but the necessary mechanism for coordination is this process of discovery.”
“If we try to guarantee people's expectations about market values and quantities, we would disable the discovery process responsible for the coordination of economic activities.”
“The very factor responsible for adjusting to disequilibria—entrepreneurship and discovery of opportunities—also produces unpredictability, so coordination and unpredictability are mutually connected in the real world.”
“Hayek believed that a tendency toward equilibrium is necessary for economics; without it, economics as we understand it couldn't exist.”
“Plans under a real conception of time are more flexible because the world can present unexpected events at any point, so plans must allow for changes at a moment's notice.”
“The traditional equilibrium concept is less useful in a world where entrepreneurial discovery creates unpredictability and surprises, leading Hayek to prefer the concept of order over equilibrium.”
“The market is a discovery process where competition produces unpredictable results, contrasting with the standard view of competition as a computational process enforcing equilibrium.”
“Good plans allow flexibility to change when something unexpected happens; rigid plans risk failure because the world is unpredictable.”
“Better than maximizing profit is planning to survive over the long run by avoiding outcomes that knock the firm out of business, reflecting uncertainty in economic decision-making.”
“Hayek's idea of order is like a stream flowing with some attention to its banks, implying economic order is less precise and more unpredictable than traditional equilibrium suggests.”
Lecture presented by Mario Rizzo on August 3, 2010 at the Foundation for Economic Education seminar "Advanced Austrian ...
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