"But that "conclusion" is based on the ASSUMPTION that the "...central authority..." actually KNOWS
-- in advance -- the exact numbers of apples and oranges that WILL be needed. "
Well, yes and no.
The utility equation can't work if you don't know how many of these you need to make a certain number of those work most efficiently.
So, yes, they have to know that in advance, but if they don't, then there is no utility equation, and at that point, no decision can be better than any other decision on the basis of utility, because there isn't a utility equation to compare options with.
You can argue that once you have these and those, you can easily see if you have too many or too few, but by then, it's too late to make planning decisions that will do you any good. If you can't plan ahead, then there's no point in comparing different systems on the basis of how efficiently each is able to plan ahead, because neither one can....plan ahead.
It's sort of a chicken and egg thing.
Much more importantly, it is at best a satellite issue, meant to show the perils of making decisions on the basis of a single variable.
Whether you agree with the utility equation, or the conclusions I drew from it, or not, makes absolutely no difference as to the advisability of making choices from a narrow point of view.
And no, I'm not a liberal, though I do enjoy making meals of them from time to time. They taste like crap, (must be all that tofu they feed on) but they can't run very fast, and don't know how to fight, so it's an easy dinner.
IMHO, experience has proved that the "Invisible Hand" of free markets is a far superior "manager" of economic activity than any rule-bound "central authority".
As a person with some familiarity with New London, I'd say that if the "Development Authority" had not used its funds for grandiose land-clearance schemes, but instead had simply cut taxes on New London's existing private businesses, the economy of New London would be far better off today than it is.
Power corrupts...