Hayek's Social and Political Thought

Hayek's Social and Political Thought

Hayek's Social and Political Thought

Hayek's Social and Political Thought

Synopsis

Revered by some as the most important twentieth century theorist of free society, Friedrich A. Hayek has been reviled by others as a mere reactionary. Impartial throughout, the author offers a clear exposition and balanced assessment that judges Hayek's theory by its own lights. The author argues that the key to understanding Hayek lies in an appreciation of the proper link between descriptive social science and normative political theory. He probes the idea of a spontaneous order and other notions central to Hayek's thought, and concludes that they are unable to provide the "scientific" foundation Hayek seeks for his liberalism. By drawing out the distinctive character of Hayek's thought, the author presents a new and more accurate picture of this important social and political theorist.

Excerpt

Like all spontaneous orders, the web of exchange relations forming in the market is, Hayek says, the outcome of a two-part mechanism. Spontaneous economic order develops when the members observe certain rules and adjust to their local situation. Put forward in such generality, this assertion is hardly comprehensible and its relevance for liberalism beyond grasp. A detailed reconstruction is needed if we are to understand what Hayek has in mind here. This chapter explores the sense in which individual adjustment may be said to contribute to the emergence of a spontaneous economic order.

Whenever Hayek talks about the mechanism conducive to spontaneous order, he gives individual adjustment much less prominence than rule-following, the other element of that mechanism. There is a reason for such unobtrusiveness. The idea that spontaneous economic order is, partly, the result of the members adapting to the specific circumstances of their individual situation is the by-product of, and is usually only mentioned in connection with, a claim to which Hayek consistently attaches much greater significance. This is the contention, central to his defence of the market, that spontaneous orders are far better able than the hierarchically structured organizations to utilize knowledge (e.g. 1973: 51; 1978: 75). Turning to individual adjustment means, therefore, above all addressing Hayek's views on the informational capacities of the market. Accordingly, the structure of the argument in this chapter will be the following. The chapter opens with an exposition of Hayek's views on the epistemic role of the market. Hayek claims not merely that a market system manages to gather and utilize the knowledge relevant for efficient economic activity yet dispersed across society. Crucially, he also maintains that only markets can generate the facts and the information needed if such activity is to . . .

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