I agree that it would increase creativity, but the question is how new inventions or better versions of existing goods are spread.
When the means of production are with the government how are they incentivised to take the risk of reducing the production of an existing article to produce an alternative, which might be more or less sought after.
Of course a similar problem exists in capitalism where a small amount of people decide what is produced in high amounts but the competition in capitalism strongly favors your product to be slightly different than your competitors, which in theory should lead to evolution as long as no monopolies are allowed.