Friedrich Hayek

The present essay aims to account for F.A. Hayek's oft-noted 'turn' away from technical economics to concerns of a more philosophical nature. In particular, the paper seeks an explanatory principle that reconciles various elements of both continuity and discontinuity in Hayek's intellectual development, especially with respect to the evolution of his arguments concerning economic fluctuations. The essay uncovers such an explanatory principle in Hayek's own methodology of sciences of complex phenomena. According to this principle, an inquirer who confronts phenomena too (...) complex for adequate explanation on the basis of current knowledge must move to a more general, albeit less testable, explanation. This is precisely what occurred in the evolution of Hayek's thought concerning trade cycles. The concluding section considers the implications of the argument for the extensive secondary literature on Hayek's 'transformation'. (shrink)

This is the first section of a five part essay dealing with economics from the perspective of Ernst Cassirer's cultural philosophy. In this first section, I try to demonstrate how the human concern with meaning is distorted in our commercial society into a purely economic sense of reality that displaces other forms of meaning. This distortion and displacement are at the heart of the social, cognitive and spiritual dysfunctions that currently plague us. The "Leverage of Meaning" will prepare the ground (...) for the formulation of the economic as a symbolic form in order to hopefully find some guidance in Cassirer's thought for restoring economy to its rightful cultural function. (shrink)

Why do corporations and wealthy philanthropists fund the human sciences? Examining the history of the Santa Fe Institute, a private research institute founded in the early 1980s, this article shows that funders can find as much value in the social worlds of the sciences they sponsor as in their ideas. SFI became increasingly dependent on funding from corporations and libertarian business leaders in the 1990s and 2000s. At the same time, its intellectual work came to focus on the underlying principles (...) of adaptation, innovation, and decentralized coordination supposedly at work in ‘complex systems’ from biological ecosystems to markets and firms. This research cast the ideas of the libertarian economist Friedrich Hayek into a new scientific idiom. SFI also became a space where figures in business, media, academia, and politics could come to learn to see the world in a particular way—to acquire the subjectivity of what I call ‘the Santa Fe Institute libertarian’. At SFI, visitors did not simply learn the principles of neo-Hayekian complex system science. They came to see themselves as agents of social evolution, providing the spark that the free-market system needed to produce new technologies and new solutions to social problems without top-down political direction. For the Institute's corporate and libertarian financiers, SFI was not just a space where intellectuals described the world in favored ideological terms, but a space where elite actors became committed to the project of making a new political-economic order. (shrink)

Philosophy & Social Criticism, Ahead of Print. In light of a growing body of scholarship that has cast doubt on the analytic import of spontaneous order, the purpose of my article is to rethink the intellectual relationship between Edmund Burke and Friedrich Hayek by suggesting that reading spontaneous order into Burke’s thought introduces greater tensions between the two thinkers than prior scholars have suggested. One crucial tension, I suggest, is that Hayek believed that contractual arrangements, competitive markets and the rule (...) of law could sustain the growth of social order, while Burke maintained that particular social institutions and practices should remain protected from the full power of voluntary contracts and exchange relations. I conclude by suggesting that the tensions between Hayek and Burke could serve as complementary instruments, rather than as foes, in strengthening the liberal project in modernity. (shrink)

John Tomasi's new book, Free Market Fairness, has been well-received as "one of the very best philosophical treatments of libertarian thought, ever" and as a "long and friendly conversation between Friedrich Hayek and John Rawls—a conversation which, astonishingly, reaches agreement". The book does present an authoritative state-of-the-debate across the spectrum from right-libertarianism on the one side to high liberalism on the other side. My point is not to question where Tomasi comes down with his own version of "market democracy" as (...) a remix of Hayek and Rawls. My point is to use his sympathetic restatements of views across the liberal spectrum to show the basic misframings and common misunderstandings that cut across the liberal-libertarian viewpoints surveyed in the book. As usual, the heart of the debate is not in the answers to carefully framed questions, but in the framing itself. (shrink)

Encyclopedia entry: http://www.sagepub.com/books/Book234813#tabview=title.

The Austrian School seems to remain outside the debate on the realism of economic models. In principle, given the association of the term “model” with the Chicago School, and also for understanding that Hayek had critized the model of perfect competition as unrealistic. Even though in previous opportunities we showed how the theory of market as a process could be understood as the model of the Austrian School, and that Hayek’s criticism to the model of perfect competition was not so (...) much of unrealistic, but that it was wrongly stated (Zanotti & Borella, 2015), and we developed the ontological foundation of the model in Hayek’s thought (Borella, 2019), in this paper we will show how it is posible to compare pattern predictions with models, and how in this sense, the Austrian School, also seems to get near, even without sufficiently noticing it, to the discussion on models in economics and their realism. Keywords: Realism of models- Hayek- pattern predictions-models . (shrink)

Philosophy & Social Criticism, Volume 48, Issue 3, Page 386-415, March 2022. In light of a growing body of scholarship that has cast doubt on the analytic import of spontaneous order, the purpose of my article is to rethink the intellectual relationship between Edmund Burke and Friedrich Hayek by suggesting that reading spontaneous order into Burke’s thought introduces greater tensions between the two thinkers than prior scholars have suggested. One crucial tension, I suggest, is that Hayek believed that contractual arrangements, (...) competitive markets and the rule of law could sustain the growth of social order, while Burke maintained that particular social institutions and practices should remain protected from the full power of voluntary contracts and exchange relations. I conclude by suggesting that the tensions between Hayek and Burke could serve as complementary instruments, rather than as foes, in strengthening the liberal project in modernity. (shrink)

Friedrich August von Hayek war ein österreichischer Ökonom und Philosoph. In Wien in eine Familie von Akademikern hineingeboren, studierte Hayek zunächst Rechtswissenschaften an der Universität Wien, zeigte aber auch großes Interesse an Psychologie und Volkswirtschaftslehre. So nahm er regelmäßig an Seminaren von Ludwig von Mises Teil und wurde 1921 in Rechtswissenschaften und 1923 in Staatswissenschaften promoviert.

Critical theory has long resisted the notion that an “invisible hand” can operate within the real social dynamics of a free market. But despite the most radical desires of the socially critical imagination, the optimization of that “spontaneous order” or depersonalized way of ordering things known as “the economy” has become the dominant playing field and decisive electoral issue of modern politics. Within this broad contemporary context, Michel Foucault made a strange theoretical intervention that, to this day, continues to baffle (...) readers. During a lecture, he argued that Adam Smith’s invisible hand was, after all, truly and purposively, that is, for technical rather than ideological reasons, “invisible.” This article argues that there is a counter-positivism or tactical irony contained within the logic of such a controversial thesis; namely, that when one acknowledges that the principle of economic competition encourages an efficient self-organizing effect at all times, regardless of context, one is also immediately in a position to appreciate why the art of government should always maintain its political primacy over the spontaneous order of the market. (shrink)

Friedrich Hayek was a fervent advocate of the methodological specificity of the social sciences. However, given his contact with Karl Popper, several historians and philosophers have characterized his final position as Popperian, that is, a position that would have accepted the unity of scientific method. A closer look at Hayek's philosophy and Popper's own intellectual course shows that such a thesis is based on misconceptions that can be overcome by taking the Hayekian concept of 'spontaneous order' as the foundation of (...) a methodology immune to any kind of methodological monism. (shrink)

Entender algo sobre un mundo que se nos presenta de modo desordenado e incompleto constituye buena parte de la tarea de la filosofía y de la ciencia. La racionalidad, los modelos, y el mundo social introducen preocupaciones propias de la filosofía de la ciencia en general y de la epistemología de la economía en particular. Los aportes de Popper, Lawson, Mäki, Hayek y Cartwright se expresan en estos trazos como intentos abiertos para alcanzar a comprender nuestro mundo.

How should we design our economic systems? Should we tax the rich at a higher rate than the poor? Should we have a minimum wage? Should the state provide healthcare for all? These and many related questions are the subject of distributive justice, and different theories of distributive justice provide different ways to think about and answer such questions. This book provides a thorough introduction to the main theories of distributive justice and reveals the underlying sources of our disagreements about (...) economic policy. It argues that the universe of theories of distributive justice is surprisingly simple, yet complicated. It is simple in that the main theories of distributive justice are just four in number, and in that these theories each offer a distinct, well-defined theoretical approach to distributive justice; yet it is complicated in that the main theories disagree at several distinct, fundamental levels, and in that it is possible to spin innumerable new theories from the elements of the four main theories. (shrink)

In the debate on realism of models in economics, the Austrian School and Hayekin particular, seem to have, in a certain way, remained outside. Assuming neoclassical models asunrealistic, the theory of the market as a process looks like a more realistic proposal. However, oneof the fundamental issue s in Hayek’s dissent is not so much the unrealism of the assumptions, but that the market equilibrium theory was not correctly raised, especially with regards to the perfectknowledge assumption. Despite this, in this (...) setting and in line with a previous paper (Zanotti & Borella, 2015), we will argue that Hayek’s spontaneous order may be understood as the Austrian School’s “model”, assuming Mäki’s MISS version of models (Models as Isolations and Surrogate Systems) and emphasizing the place of the ontological foundation of Hayek’s proposal when assessing his model. (shrink)

Si bien no es habitual pensar a Hayek en términos de realismo, sino comprenderlo como neokantiano, presentaremos la interpretación realista fenomenológica de Hayek que ofrece Zanotti a lo largo de su obra. Señalaremos los aspectos centrales de la epistemología de Hayek y la lectura realista fenomenológica como una posición superadora tanto del positivismo como de una hermenéutica relativista.

Friedrich Hayek’s defense of neoliberal free market capitalism hinges on the distinction between economies and catallaxies. The former are orders instituted via planning, whereas the latter are spontaneous competitive orders resulting from human action without human design. I argue that this distinction is based on an incomplete semantic history of “economy.” By looking at the meaning of “oikonomia” in medieval providential theology as explained by Giorgio Agamben and Joseph Vogl, I argue how Hayek’s science of catallactics is itself a secularization (...) of providential theology. This exposes Hayek to three criticisms: he unjustifiably neglects the possibility of tendencies toward spontaneous disorder in free markets, he condemns the “losers” of neoliberal competition to being providential waste on the road to general prosperity, and he imposes on people the duty to consent to a neoliberal order that hinders them from cultivating their inoperativity. (shrink)

Karl Polanyi's double movement is a dialectical process characterized by a continuous tension between a movement towards social marketization and a movement towards social protectionism. Notably, Polanyi condemns the former movement while defending the latter. Without using the term " double movement " , F.A Hayek's theory of social evolution acknowledges the same phenomenon but reaches different normative conclusions. While for Polanyi the marketization of society is a utopia with dystopian consequences, Hayek's evolutionary explanation of this dialectical process asserts that (...) there is no alternative to a market oriented society. Both authors defend that their favoured movement is the one that truly supports the continuity of life. This article compares the authors' normative readings of the double movement and concludes that, from an evolutionary perspective, Polanyi's conclusion possesses a robustness that Hayek's postulate lacks. (shrink)

In this paper we will analyze Lawson’s criticism of Hayek for not having transcended positivism. We will distinguish two levels in the criticism: methodological and ontological. So far as methodological criticism is concerned, we consider that Lawson’s positivist interpretation of Hayek regarding the method in economics is not the only possible, and we will try to develop another one. With respect to ontological criticism, we will state that though it is possible to understand Hayek as an ontological positivist, since he (...) assumes an ontological individualism, this fact would not necessarily lead to positivism -question to which Lawson seems to bring Hayek closer after 1955- but a moderate ontological individualism could be assigned to Hayek founded on a realistic interpretation of Husserl’s phenomenology. (shrink)

En este artículo se ofrece una presentación de los aspectos centrales de la concepción del hombre de Hayek y una breve refl exión sobre ella. Primero, se expone su concepción de lo que es el hombre: un ser individualista, cuya evolución histórica conduce a la "sociedad extendida", y creador de normas y tradiciones. A continuación, se caracterizan sus principales dimensiones: la ética es heterónoma y coincide con las reglas sociales; su razón es limitada; la libertad es individual, negativa, y se (...) limita a la libertad económica y, fi nalmente, sostiene que los hombres son naturalmente desiguales. We explain the main aspects of Hayek's conception of man and its intellectual background. The Austrian thinker developed this conception on two levels. On the one hand, he proffers an idea of what man is, namely, an individualist, who evolves from "tribal society" to "extended society", and a creator of norms and traditions. On the other had, he tells how man is, he spells out his chief characters: man's ethics is heteronomous and immanent to the reproduction of society; man's intelligence is limited and his central value is freedom, economically understood. Finally, Hayek maintains that me are naturally unequal. (shrink)

The article investigates the connections between Hayek’s cognitive psychology and his methodological individualism. It argues that Hayek’s theory of the sensory order, which is his less-studied scientific contribution, supports an original but largely unknown argument in favour of the Verstehen approach of methodological individualism. Hayek merges a theory of the temporality of knowledge as understood by phenomenological hermeneutics, and notably by Gadamer, with a proto-connectionist theory of mind to develop a perspective that anticipates by decades Varela’s and Maturana’s neuro-phenomenology. The (...) article shows that Hayek uses this perspective to criticize the deterministic paradigms of action that consider action to be a mechanical effect of a pre-given reality and challenge the Verstehen approach, which is defended both by methodological individualism and phenomenological hermeneutics. (shrink)

Friedrich Hayek is one of the most influential political philosophers of the twentieth century. A 1974 Nobel Prize winner for Economics, Hayek argues for the superiority of the free society over totalitarian, planned societies. Although Hayek arguably hit his target, he missed the bull’s-eye, because he failed to explain government and its prudential limits with reference to a complete view of human nature. This is partly because he failed to recognize that Christianity is the essence of Western civilization.

Name der Zeitschrift: Zeitschrift für kritische Sozialtheorie und Philosophie Jahrgang: 2 Heft: 1 Seiten: 182-199.

The present essay addresses the epistemic difficulties involved in achieving consensus with respect to the Hayek–Keynes debate. It is argued that the empirical implications of the relevant theories are such that, regardless of what is observed, both theories can be interpreted as true, or at least, as not falsified. The essay explicates the respects in which the empirical evidence underdetermines the choice between the relevant theories. In particular, it is argued both that there are convenient responses that protect each theory (...) from what appears to be threatening evidence and that, for particular kinds of evidence, the two theories are empirically equivalent. Larry Laudan's suggestion that ampliative methodological criteria can resolve an underdetermined choice between multiple scientific theories is considered and rejected as a possible means to rational consensus. (shrink)

The paper aims to establish that Terence Hutchison’s argument in The Politics and Philosophy of Economics (1981) to the effect that the young F.A. Hayek maintained a methodological position markedly similar to that of Ludwig von Mises fails to establish the relevant conclusion. The first problem with Hutchison’s argument is that it is not clear exactly what conclusion he meant to establish with regard to the methodological views of the two paragons of 20th century Austrian economics. Mises (in)famously maintained a (...) rather extreme methodological apriorism. However, Hutchison’s argument does not support the claim that Hayek was ever an apriorist of the Misesian variety. The concept of a priori knowledge that emerges from Hayek’s epistemology – specifically the epistemology implied by Hayek’s work in theoretical psychology – is the direct opposite of Mises’ treatment of a priori knowledge. Simply stated, Hayek conceived of a priori knowledge as fallible and relative, while Mises considered a priori knowledge to be infallible and absolute. Thus, it cannot be maintained – if, indeed, Hutchison meant to establish – that Hayek was a Misesian apriorist during the years in question. What’s more, the paper shows that Hutchison’s argument does not support a weaker interpretation of the relevant conclusion. There are alternative interpretations of the evidence adduced by Hutchison that are both more charitable and more in line with Hayek’s epistemology that undermine Hutchison’s conclusion. (shrink)

From the early-1950s on, F.A. Hayek was concerned with the development of a methodology of sciences that study systems of complex phenomena. Hayek argued that the knowledge that can be acquired about such systems is, in virtue of their complexity (and the comparatively narrow boundaries of human cognitive faculties), relatively limited. The paper aims to elucidate the implications of Hayek’s methodology with respect to the specific dimensions along which the scientist’s knowledge of some complex phenomena may be limited. Hayek’s fallibilism (...) was an essential (if not always explicit) aspect of his arguments against the defenders of both socialism ([1935] 1948, [1940] 1948) and countercyclical monetary policy ([1975] 1978); yet, despite the fact that his conceptions of both complex phenomena and the methodology appropriate to their investigation imply that ignorance might beset the scientist in multiple respects, he never explicated all of these consequences. The specificity of a scientific prediction depends on the extent of the scientist’s knowledge concerning the phenomena under investigation. The paper offers an account of the considerations that determine the extent to which a theory’s implications prohibit the occurrence of particular events in the relevant domain. This theory of “predictive degree” both expresses and – as the phenomena of scientific prediction are themselves complex in Hayek’s sense – exemplifies the intuition that the specificity of a scientific prediction depends on the relevant knowledge available. (shrink)

"Friedrich von Hayek and Karl Popper were two of the twentieth century's greatest thinkers, and two of its greatest proponents of freedom and open society. They were also close friends, and even people who are very familiar with their writings often think that their philosophical, economic, and political views are more or less the same. This book, however, argues that Hayek and Popper differed in fundamental ways about rationality, economism, and democracy--and that these differences, and the different ways in which (...) Hayek and Popper argued for them, lie at the heart of political thought and still have significant consequences for our own political discourse today. It argues that Hayek and Popper disagreed about whether and to what extent society is well served by deliberate attempts at government intervention; about whether and to what extent democracy involves majority rule; and, most importantly, about whether we should value freedom for its own sake, as an end in itself, or merely as a means to greater prosperity and wealth. Contrary to Popper, this volume argues that Hayek was prepared to accept socialism--which in his view logically implies totalitarianism--if it could be shown to be at least as efficient and productive as the market; that his concept of freedom is grounded in the same sort of economism that Popper criticized in Marx; and that he proposed reforms to the electoral system that would actually transform a democracy into what Popper would have regarded as a tyranny"--. (shrink)

This paper examines two paths by which F. A. Hayek’s work has influenced the cognitive theory of institutions: cognition and cultural evolution. It argues that there is a relationship between the sensory order and the social order. The explanation of social order begins with the human mind. This is illustrated with ideas relating to understanding culture from a cognitive viewpoint. Human cognition makes cultural evolution an endogenous process. The paper draws on ideas of co-evolution of individuals’ mental models and their (...) actions. Mental models can be modified by feedback from altered perceived reality as a consequence of peoples’ altered actions. A key to understanding cultural evolution is an understanding of how individuals modify their mental models. (shrink)

Assesses John Tomasi's Free Market Fairness.

Friedrich Hayek was awarded the 1974 Nobel Prize for Economic Sciences for his contributions to the analysis of money and the business cycle, and for his penetrating analysis of the interdependence of economic, social and institutional phenomena. Hayek was a polymath: he systematically analyzed human rationality, the nature of knowledge, and methodology. This book, which analyses his contributions to the emerging – and revolutionary – field of behavioral economics, has been written by an outstanding collection of authors including Deirdre McCloskey, (...) Herbert Gintis, Peter Boettke and Nobel Laureate Vernon Smith. It is demonstrated that Hayek's seminal contributions came decades before economists such as Herbert Simon (winner of the 1978 Nobel Prize) and Harvey Leibenstein began to develop the field in earnest. (shrink)

Hayek developed two contradictory epistemologies. The epistemology for which he is famous attributed dispersed knowledge to economic actors and credited the price system for aggregating and communicating this knowledge. The other epistemology attributed to human and non-human organisms alike the error-prone interpretation of stimuli, which could never truly be said to be “knowledge.” Several of the paradoxes of Hayek's economic and political thought that are explored in this symposium can be explained by the triumph of the first epistemology over the (...) second, including his historical interpretation of socialism as a planning mentality; his tendentious definitions of “liberty” and “justice”; and his opposition to economic redistribution even as he endorsed all manner of economic and social regulations. (shrink)

At the end of World War II, F. A. Hayek denounced the then-popular idea of central planning by arguing that, if pursued to its logical conclusion, it would entail totalitarianism. But there were at least two problems. First, judging by his example of Nazi Germany, state control over the economy appears to be a consequence, not a cause, of the monopolization of political power. Second, he conflated socialism and mere interference in the market with central planning. Therefore, history did not (...) so much falsify Hayek's prediction as bypass it: Once the vogue for central planning faded in the West, Hayek's book became irrelevant—except, ironically, in Germany. There, it was read as a manifesto for “good planning” through the rule of law. Alongside other “neoliberal” writers, Hayek had a profound (if little acknowledged) influence on the shape of the emerging Federal Republic and, through it, on the whole European institutional framework. (shrink)

There is an odd proximity between Hayek, hero of the libertarian right, and Rawls, theorist of social justice, because, at the level of principle, Hayek was in some important respects a Rawlsian. Although Hayek said that the idea of social justice was nonsense, he argued against only a particular principle of social justice, one that Rawls too rejected, namely distribution according to individual merit. Any attempt to make reward and merit coincide, Hayek argued, would undermine the market's price system, leaving (...) us all poorer and less free. Like Rawls, Hayek held that we should assess social institutions from behind a veil of ignorance, and he thought that doing so pushed us toward egalitarianism. Most of the distance between Hayek and Rawls at the level of policy stems from Hayek's optimism about the operation of markets, his equivocation about the meaning of central concepts, and his appeal to under-argued slippery slopes. Hayek wavered, however, between claiming that private property and markets benefit everyone, compared to the feasible alternatives, and the principle that they maximize the opportunities of a randomly selected member of society, i.e., aggregate opportunity. Contemporary Hayekians claim that capitalism raises the position of the worst off in the long run, in future generations, whereas Rawlsians insist that inequalities between social positions should benefit the worst off now. (shrink)

Michael Dorf and Charles Sabel invoke John Dewey’s “pragmatist account of thought and action” as the “backdrop” for their theory of democratic experimentalism, an approach to governance emphasizing judicially monitored local decision making within a system of decentralized administrative authority. Little credit for influence is given to the Austrian economist Friedrich Hayek and his classic liberal ideas. Indeed, Sabel has been highly critical of Hayek’s ideas. Yet, an argument can be made that (i) democratic experimentalism is at least loosely Hayekian (...) and (ii) a combined Deweyan-Hayekian analysis of Dorf and Sabel’s theory reveals some critical mistakes. One implication of my analysis is that Dewey and Hayek’s ideas are more compatible than most democratic theorists and political philosophers will admit. Evidence of this compatibility opens the door for creating and evaluating democratic experiments within a Deweyan-Hayekian theoretical framework, as well as extending the framework to other areas of political inquiry. (shrink)