massive shortfalls in production
Not necessarily.
I notice that you didn't provide any counterexamples which is, of course, because there aren't any. No planned economy larger than a few hundred people has ever succeeded. While capitalist economies do go through cycles of expansion and recession (which a well-functioning central bank and adequate regulatory oversight can ameliorate but not eliminate), capitalism consistently makes the entire society wealthier, top to bottom. Yes, it does tend to produce inequality, and that has some negative social effects, but over time even the poorest end up better off than under any other system, assuming modest government regulation to prevent abuses.
Capitalism is not very efficient, there's a lot of wasted resources and duplication of effort.
There really isn't; definitely not compared to central planning. The results speak for themselves, but it's useful to understand why, I think. When people look at the way capitalist economies tend to produce 10 factories making similar shoes while it seems obvious that one big factory would be more efficient, the mistake they're making is in looking only at what they can see with their eyes: Buildings, machinery, people, all making shoes, redundantly. What they fail to see is the knowledge about how to make shoes efficiently that ebbs and flows through those same enterprises. This is the core flaw in the Labor Theory of Value, actually, which was the basis of Marx's understanding of economics.
The Labor Theory of Value will tell you that the value of a product is determined by the resources that went into producing it, material, energy and labor. But it omits the knowledge required to produce the product and the right knowledge can decrease the resource requirements by orders of magnitude. Capitalism works because it incentivizes the creation of knowledge that enables more efficient production, as well as the creation of better products (where "better" means "optimized to consumer desires in context").
This is why the 10 shoe factories end up being more efficient than one.
But that's not where capitalism provides the biggest efficiency boost to the economy. The biggest boost comes from the knowledge it generates about the most efficient way to allocate capital. Wall Street looks on its face like an incredible waste of money. All of those people generating massive personal incomes by "gambling" on stocks and bonds. In truth, that competitive game is the knowledge engine that no central planning board has come remotely close to matching, and certainly has never exceeded. All of the money to be made in trading incentivizes brainpower to concentrate on solving the problem of making sure that the most productive enterprises have the resources they need.
Any system that fails to replace the knowledge generation capitalism provides will ultimately be far less efficient, and will generate production shortfalls. No one has yet proposed any system that even attempts to cover that critical gap.
So far, the absolute best economic structure we've devised -- as evidenced by actual outcomes, not just theory -- is lightly-fettered capitalism overlaid with a redistributive social safety net.