The Danish Social Democrats have lately been transitioning to this view (in earlier years, they much more strongly emphasized state ownership of the means of production). The buzzword "flexicurity" is a banner under which they've been explicitly pushing a decoupling of planning mechanisms from wealth distribution. The idea is that the economy will be "flexible", so you can do whatever you want with a minimum of red tape, easy regulations, and easy hiring/firing rules, but on the other hand nobody loses too badly because there is a strong social-safety net providing the "security" (https://en.wikipedia.org/wiki/Flexicurity). So it's easy to fire a worker, but the worker won't get evicted from their home if you do. If they have trouble finding another job, they'll get monetary support, retraining support, etc. In a way this makes it therefore even easier to fire them (because you lose the guilt aspect). Because benefits other than salary aren't tied to working, employers also feel quite a bit of flexibility to change people's hours: you can move someone from full-time to 3 days a week if business slows down a bit, without them losing their health insurance, which is a level of flexibility American employers don't enjoy.

One way of looking at it is modulating the outcome distribution of the "game". Yeah, games are a great way to test out economic ideas in "competition" with one another, but the outcome distribution maybe should be more shallowly sloped, not a winner-takes-all game.

I do think one important aspect is that the state still does make some planning decisions, especially on infrastructure. The decisions may be implemented with market mechanisms, by putting out a tender for the operating contract. But the state decides which metro lines to build, how much service there should be, what fares should be, etc. The state also centrally manages both the healthcare and university systems as a "single payer", though some degree of internal markets exist within those sectors (especially in the universities).