Micheal,

Hayek and Mises saw important differences between
businesses (large and small) and government or public
agencies. Private agencies involve the calculation of
monetary profit, public agencies do not. Hayek and
Mises saw monetary profit as a monitoring mechanism,
that allowed principles to check the performance of
agents easily. Mises repeatedly insisted that monetary
profits allow owners to monitor the performance of any
size organization. This runs counter to the views
expressed by Peter Klein, but Mises insisted upon this
in several of his books. Monetary profits regulate the
size of different branches in an organization. The CEO
can simply check rates of return in different
branches, expand the more profitable areas, curtail
the less so, and shut down areas with losses (unless
their is reason to expect better future prospects).
Public agancies lack calculation of monetary profit,
so this means of regulating large operations is not
available. 

Also, Mises stressed the importance of financial
markets in determining the investment projects of
private organizations. Future production is determined
by financial investors, who buy bonds and stocks,
extend loans, buy options... The plans of public
agencies are not regulated in this way, least of all
in socialism. Financial markets are a crucial
regulating mechanism in the Mises-Hayek system. I have
several papers on this, two of which are close to
being published at the EEJ and ROPE. I can send you or
anyone else copies...

Doug MacKenzie