Spontaneous Order in Hayek’s The Fatal Conceit

Hayek’s most recent work, The Fatal Conceit, suggests conflicting interpretations of the concept of “spontaneous order.” Spontaneous order has traditionally referred to institutions that are the result of human action but not of human design, such as money or language. Classical liberals often portray spontaneous order as a voluntarist or market-based concept that stands in opposition to coercive central planning. The question arises, however, whether we should consider public sector institutions as part of the spontaneous order.

Hayek appears to want to have his cake and eat it too. On the one hand, he continually refers to socialism and central planning as elements external to the spontaneous order; socialism attempts to impose the discipline of planning upon an order that is too complex to be effectively directed by conscious engineering.

On the other hand, Hayek (p. 37) stresses the importance of institutions based upon deliberate organization as a part of the spontaneous order. Such institutions include “firms and associations, as well as...administrative bodies”. Although many elements of these structures are planned, they “have a place only within an even more comprehensive spontaneous order” (p. 37). Hayek’s prose is not unambiguous here, but from reading this passage and many others in The Fatal Conceit, one might take Hayek to be suggesting that the state has evolved within society and is part of a broader spontaneous order.

Social sciences such as anthropology, political science, and public choice economics imply that governmental structures have evolved within the context of a broader spontaneous order. It would surely be strange if a theory of the importance of unintended consequences excluded the public sector from participation in evolutionary feedback mechanisms. While many governmental structures were consciously planned, the evolutionary, unplanned elements appear no less important. Consider, for instance, the evolution of the committee system in Congress or the American two-party system. Neither institution was designed according to a master plan, yet both are an integral part of our government.

We can attempt to resolve the tension in Hayek’s theory of spontaneous order in a number of different ways, each of which raises further questions. We might argue, for instance, that Hayek is not fully consistent and that only the market is a spontaneous order; the state, qua state, is the product of rationalist of “constructivist” planning. I believe, however, that this view is empirically false, for reasons briefly noted above. In addition, this is probably not the correct interpretation of Hayek, as it leads to libertarian or anarchistic conclusions that Hayek unequivocally rejects.

Another possibility is that Hayek means to draw a distinction in kind between “government” and “socialism”. Western style mixed-economy governments may be part of the spontaneous order but totalitarian regimes, such as Stalinist Russia or Pol Pot’s Cambodia, are not. Even if such a distinction can be defended, it leads only to a rather obvious and unoriginal condemnation of totalitarianism. Hayek appears to be saying more than merely regurgitating Mises’s critique of the total command economy.

A third way of resolving the tension in Hayek’s thought is to accept the state, in all its manifestations, as part of a spontaneous order that encompasses all aspects of social life. Current governments have evolved within this spontaneous order, although we need not believe that they are necessarily benign. We may believe, however, that the historical successes enjoyed by Western society give us valuable information about the desirability of the underlying institutional structure. (I do not think that Hayek’s argument relies upon any [false] analogy with the theory of group selection in population biology, as some critics have alleged. It is an empirical fact that successful socioeconomic systems, such as the Roman Empire, the European democracies, and America have spread their influence. In Asian history, the most successful cultures of antiquity were also the most influential, e.g., China and India.) Such successes include large populations, maintaining a high standard of living and education, and producing and spreading cultural products.

One can thus read Hayek as having produced a sophisticated “historicist” defense of Western civilization. Although this historicism may not be inconsistent with the desire of classical liberals to expand the scope of the market economy, Hayek’s theory of spontaneous order does not itself imply a fundamental critique of existing government interventions. Such interventions have evolved as part of a spontaneous order (just as markets have evolved) and are part of the most successful socioeconomic systems the world has seen to date.

Some passages in Hayek’s words are inconsistent with the historicist interpretation of The Fatal Conceit. I am thus offering only a possible reading of Hayek, not an account of what he “really meant”. Like many other great thinkers (Mill, Hume, Marx, and Quine, to name a few) Hayek’s thought is riddled with tensions and problems, some of which border on outright inconsistencies. The reader’s attempt to wrestle with such tensions is precisely what makes Hayek’s work so rewarding; like many of Hayek’s earlier works, The Fatal Conceit should be a source of inspiration for future scholars.

Hayek’s work is drained of much of its richness if we try to defeat or eliminate these tensions by interpreting Hayek in either purely libertarian or conservative fashion. Libertarians wish to rely upon the results of market evolution but do not rely upon evolution in general to produce the proper mix between market and state. In contrast, conservatives give evolution a large place in deciding the proper mix of state and private sector activities but are more willing than libertarians to interfere with market evolution. Hayek’s theory of spontaneous order, as it currently stands, does not allow us to easily endorse one kind of evolution and reject the other. The Fatal Conceit thus shows how subtly the presuppositions behind either conservatism or libertarianism can be used to support the other doctrine; perhaps this is the greatest contribution in Hayek’s new book.