Four Problems with Spontaneous Order

Introduction

Among scholars of freedom, few are more admired than the polymathic Friedrich Hayek, who helped articulate the case for liberty in economics, law, politics, and other disciplines. Perhaps his most famous idea is that social mores or legal rules can emerge as a result of particular individuals acting on local knowledge — and therefore that economic and political order need not be designed and implemented by conscious planning. Indeed, economic and political orders are so complex, and involve so much scattered and inarticulable information, that no central authority could harness the details required to design them. In a free society, countless individuals managing their own affairs end up cooperating without realizing it, thanks to the choices they make based on their limited information. The whole institution grows from the bottom up. This “spontaneous order,” Hayek argued, is a dynamic discovery process, in which people can experiment with new social mores, or new laws, just as they might with new technologies. As he put it in The Constitution of Liberty, “[t]he existence of individuals and groups simultaneously observing partially different rules provides the opportunity for the selection of more effective ones.”

Hayek contrasted this with “rational constructivism”: that is, the effort to construct an order through top-down planning that coordinates individual actions toward some chosen end. Government bureaucracies and socialized industries are constructed orders, which Hayek defined as “relatively simple, or at least necessarily confined to such moderate degrees of complexity as the maker can still survey… usually concrete, in the sense… that their existence can be intuitively perceived by inspection, and… they invariably do (or at one time did) serve a purpose of the maker.”

This is a useful observation, so far as it goes. Unfortunately, Hayek went further. In Law, Legislation and Liberty, he used this observation as the foundation for a critique of constructivism. In short, Hayek argues that we ought to prefer spontaneously generated orders and resist efforts to construct and impose intentional and purposive institutions. But, as I explain more thoroughly in “Some Problems with Spontaneous Order,” there are four major problems with his argument: (1) The difference between constructed and spontaneous orders is not a difference in principle. Indeed, the difference turns out to depend solely on the observer’s choice of perspective. This means that (2) while spontaneous order is descriptively useful, it provides no basis for a normative critique of constructivism, just as the concept of evolution by natural selection cannot tell us whether a lion should eat any particular antelope. In fact, (3) unless all orders that persist are ipso facto just, then the concept of spontaneous order gives us no basis for recognizing an unjust order. Hayek tried to resolve this problem by incorporating intentional planning into the process of spontaneous order, but this meant that (4) remedying injustice requires “rational constructivism,” which leads us back to problem (1).

1. The Difference Between Spontaneous and Constructed Orders

The distinction between spontaneous and constructed orders dissolves upon rigorous inspection. Any action by any individual or firm in the market looks on close-up view like a constructed, artificial order. But take three steps back, and from a distance the same action looks like part of the bustling, experimental give and take of spontaneous order.

If a company adopts a new policy for handling paperwork or manufacturing some product, that policy — the brainchild of an executive who decided to impose the policy from the top down — is surely a constructed order; it is “relatively simple,” “concrete,” and “serve[s] a purpose of the maker.” But from the perspective of the economy as a whole, that same policy is just a single experimental new idea, a crucial ingredient in spontaneous order: “[t]he existence of individuals and groups simultaneously observing partially different rules provides the opportunity for the selection of more effective ones.”

Consider an exchange between Judge Richard Posner and economist Donald Boureaux in the NYU Journal of Law and Liberty. Posner commented that Hayek’s belief in spontaneous order was “in considerable tension with his great admiration for the Constitution of the United States,” because the Constitution was a written plan of government formulated by experts — a constructed order. But Boudreaux disagreed: the Constitution’s authors “did not seek to create all or even most law de novo,” or “to replace wholesale one set of laws with another.” Rather, they incorporated “[t]he evolved common law rooted in English experience and modified by more recent experience in the colonies.”

Both Posner and Boudreaux were right. The Constitution was rationally constructed, if looked at up close — but it was also the product of a spontaneous order, seen in the context of the history of Anglo-American common law. One cannot distinguish between spontaneous and constructed orders on the basis that Boudreaux suggests — that spontaneous orders incorporate the ideas learned from past experience — because no constructed order is entirely brand new. “No system of law,” Hayek admits, “has ever been designed as a whole, and even the various attempts at codification could do no more than systematize an existing body of law, and in doing so supplement it or eliminate inconsistencies.” Even the most sophisticated bureaucratic, top-down plan is going to incorporate lessons learned through historical experience. In other words, the “partially different rules” that compete in the spontaneous order are necessarily “constructed” ones. And because Hayek incorporates these elements of constructivism into his account of spontaneous order, he ends up making it impossible to discriminate between a spontaneous and a constructed order.

Hayek exploited his concept’s flexibility when he said that “deliberate efforts… [to] improve the existing system by laying down new rules” were actually consistent with the principle of spontaneous order because “it remains true that the system of rules as a whole does not owe its structure to the design” of planners. The phrase “as a whole” is doing all the work here. As a whole, no order is constructed. The term “as a whole” here represents Hayek taking a convenient and unwarranted step back to look at the system through a lens so wide that anything, no matter how rationally constructed, can still qualify as part of the spontaneous order.

This trick renders the distinction between spontaneous and constructed order trivial, or, worse, rhetorical. If the observer draws a circle narrowly around a single transaction, a single reform proposal, a single firm, a single state, or a single nation, then the order appears constructed. But take a step back and look at the transaction in the context of the multitude of interactions between individuals and firms — “the system of rules as a whole” — and even the most radical, state-implemented reform is just a tiny experimental particle in the flux of spontaneous order. The difference between constructed and spontaneous orders, in fact, begins to look more like the difference between microevolution and macroevolution in biology. Whatever use that distinction might have in some contexts, it is not a distinction in principle: all evolution is microevolution; macroevolution is just an accumulation of microevolutionary changes over the course of aeons.

2. The Normative Critique of Constructed Order

If there’s no conceptual distinction between constructed and spontaneous order, there can be no foundation for a normative critique of constructed orders. It is true that order can emerge from particular actions, but that is not a good argument against implementing planned or constructed approaches to social problems. If a bureaucrat proposes a top-down, rational plan for economic or social organization, the Hayekian cannot object that doing so will disrupt the development of spontaneous order; indeed, that plan is a product of the spontaneous order — and, of course, new spontaneous orders will grow up around it once implemented.

Hayek recognized that spontaneous orders generally include, or are made up of, constructed elements: a spontaneous order, he wrote, is a process “in the course of which spontaneous growth of customs and deliberate improvements of the particulars of an existing system have constantly interacted.” But the boundaries of this interaction are so imprecise that the idea of spontaneous order loses all strength as a basis for criticizing rational constructivism.

Consider, for example, an architect designing a college campus, who wants to decide where to put the sidewalks between the buildings. The “constructivist” solution is to draw lines where the students “ought” to walk, and put sidewalks there. But a Hayekian advises the architect to wait a year and see where the students choose to walk, and then put the sidewalks there, products of a spontaneous order. The architect takes this advice, but a year later, when he goes to install the sidewalks, he meets his Hayekian friend again, who urges him to stop and wait another year! After all, the student body has changed in the interim; rooms were reassigned, and various other factors have reordered the students’ preferences. To put in sidewalks now would be to handicap the dynamic, ever-changing spontaneous order. Every year, he is met with the same advice! Spontaneous orders always evolve, and whenever anyone tries to implement a “discovered” rule, the same objection applies. (Of course, Hayek recognized that discovered rules must eventually be implemented, but as we’ll see, his response to this creates even more problems.)

Hayek seems to argue that lawyers and economists ought only to aim at improving the process of spontaneous order, rather than focusing on results: “we can preserve an order of such complexity not by the method of directing the members, but only indirectly by enforcing and improving the rules conducive to the formation of a spontaneous order.” But everything is “conducive to the formation of a spontaneous order” in one way or another, including coercive institutions. The many accountants who make a living helping fill out tax forms are testament to this.

If spontaneous order incorporates constructed or coercive elements, then it cannot serve as a basis for criticizing constructivism or coercion. As I said before, biological evolution is a spontaneous order process, but it cannot tell any particular lion whether or not to eat any particular antelope, because either way, that choice is incorporated into the process of evolution. Likewise, spontaneous order can give us no guidance about whether any particular rationally constructed plan should or should not be implemented.

3. Recognizing Injustice

Hayek does not fall into the Panglossian trap of arguing that whatever rules happen to persist through social evolution are ipso facto good (although he comes close at times). But his recognition that there may be “occasions when it is recognized that some hereto accepted rules are unjust in the light of more general principles of justice” raises a new problem: how does one recognize unjust rules? Where do we get the “general principles of justice” against which to compare the existing order? Hayek’s antirationalism leads him to reject the idea of “construct[ing] social rules by deduction from explicit premises.” Indeed, he goes further: the individual mind is “itself the product of the same process of evolution to which the institutions of society are due,” and is “embedded in a traditional impersonal structure of learnt rules” so that “its capacity to order experience is a replica of cultural patterns which every individual mind finds given.” The process of cultural evolution actually “creates reason,” and philosophy’s “great error” is the idea “that the intuitively perceived ethical values, divined out of the depth of man’s breast, [are] immutable and eternal.”

But if the mind really is socially constructed, it would be untenable for the individual to criticize his social order by comparing it to some abstract notion of justice. As Chandran Kukathas puts it, Hayek’s premise would make it impossible to “stand outside the evolutionary process to evaluate different states of affairs that rational action might lead to.”

So despite Hayek’s (inconsistent) invocation of the “indispensable” necessity of “an ideal picture of a society which may not be wholly achievable,” it is not possible for the citizen of a spontaneous order to take steps toward reform without violating his precepts. The bulk of Hayek’s writing is devoted to attacking the constructivist impulse to impose designed, purposive schemes for making society conform to abstract ideals. Laws, he contends, should be purpose-independent — which means that, just as it is “nonsensical to judge the concrete results of competition by some preconception of the products it ‘ought’ to bring forth,” it is equally nonsensical to judge the concrete results of a rule by some preconception of the outcomes it “ought” to produce. An undesirable particular outcome cannot signal the need to revise the rule that produced it.

The only way Hayek can include social reform in his theory is to devise some account of “immanent” social criticism — criticism that comes not from philosophical abstractions, but is endogenous, and generated by the process of spontaneous order itself. This immediately suggests to Hayek that rules can and should be reformed when they prove inconsistent with other rules. This is the only basis for social criticism that Hayek seriously offers; he makes no effort to explain the origin or basis of the other values he sometimes mentions, like non-coercion. He chooses consistency because it seems more neutral, internal, and process-oriented than abstractions like justice.

But in fact it isn’t. Consistency is not itself an immanent or endogenous value. Inconsistency, like anything else, may very well be perfectly tolerable to members of society. In the days of slavery, white southerners were happy to live in a system that treated blacks differently, and when necessary, antebellum judges often resolved inconsistencies in the law of slavery by simply declaring slaves to be sui generis, subject to unique rules (which does formally eliminate the logical consistency) or by treating them more consistently like property. Consistency is not an adequate substitute for justice.

Yet Hayek believes that justice “depends on the requirements of an existing order to which we are committed.” Why should one be “committed” to that existing order? And, if we should be, why we should one ever seek to reform the existing order by eliminating inconsistencies that might actually strengthen it in ways we cannot understand? At most, Hayek’s advice to reformers is “be careful” — but that cannot serve as a meaningful guide to action in any particular situation.

4. Reforming Injustice

Hayek’s search for an “immanent” social reform is handicapped even more by his reverence for tradition. If we ought to “submi[t] to undesigned rules and conventions whose significance and importance we largely do not understand,” how are we to tell whether an inconsistency in the rules is real or merely apparent, or whether it ought to be eliminated or retained? Idealistic youths in the 1960s might have thought segregation inconsistent and senseless, but if they were counseled to revere conventions whose significance they could not understand, they would not have become freedom riders. Only abstract notions of justice, derived not from mere experience, but by “rationalistic” thinking, can lead to reform of long-standing, traditional injustices.

Hayek does try to incorporate this rationalistic reform into his account of spontaneous order, but only at the cost of stretching that conception so widely as to encompass any state of affairs, and thus render the observation trivial, as noted in part I above. To again quote Kukathas, “if ‘reason’ must be viewed as merely an aspect of the development of social order…not only does it become impossible to distinguish spontaneous processes from constructed organizations, but the very idea of criticism and social reform becomes illusory.”

In Law, Legislation, And Liberty, Hayek struggles and fails to explain how injustice can be eliminated consistently with respect for spontaneous order. He argues that judges should reform faulty rules through “piecemeal tinkering,” but because there is no principled distinction between spontaneous and constructed orders, it is also impossible to distinguish between the rational constructivism that Hayek attacks and the “piecemeal tinkering” he defends.

Consider Lawrence v. Texas, the U.S. Supreme Court decision striking down a Texas law against private, consensual homosexual sex between adults. Many states had such laws, and they were nothing new. Moral condemnation of homosexuality is an ancient custom, a product of spontaneous order, the purpose of which many cannot justify or understand — it is, in Hayek’s words, “part of a moral tradition of the community, a common ideal shared and unquestioningly accepted by the majority.” For the Court to declare those laws unconstitutional based on rationalistic individualism was surely a radical reworking of the social order! Unsurprisingly, conservatives have employed Hayek’s arguments in criticizing courts that rule in favor of gay rights.

But on the other hand, many Americans regarded the Texas law as (in the words of one justice) “uncommonly silly,” and such laws seem to have been seldom enforced. The majority opinion in Lawrence forcefully marshaled precedent and moral and political arguments accepted by many people to conclude that such laws contradict Constitutional protections for individual liberty. Indeed, the justices made a strong argument that they were simply making the law more consistent with fundamental American values — just as Hayek recommended when he wrote that judges should “fill” in legal “gaps” by “appeal[ing] to yet unarticulated principles” that are “required by the rationale of the existing order,” and are “likely to receive general consent.” Judges, he writes, should overthrow existing rules “if they are in conflict with the general sense of justice.” Unsurprisingly, Hayekian arguments have also been used to defend judicial expansions of gay rights.

So was Lawrence a major rationalistic overhaul of American law, or was it just a piecemeal, immanent change? Once again, it’s all a matter of perspective.

Conclusion

Rules, Hayek tells us,

will in their first instance be the product of spontaneous growth, [but] their gradual perfection will require the deliberate efforts of judges (or others learned in the law) who will improve the existing system by laying down new rules…. Yet it remains still true that the system of rules as a whole does not owe its structure to the design of either judges or legislatures. It is the outcome of a process of evolution in the course of which spontaneous growth of customs and deliberate improvements of the particulars of an existing system have constantly interacted.

Under these criteria, any system of rules, and any decision by a judge — whether for the plaintiff or the defendant, or supporting, abolishing, or refining any existing rule — is just a benign part of the spontaneous order. Nothing a planner can do — and everything a planner can do — would violate Hayek’s precepts.

Also from This Issue

Response Essays

  • Four Solutions to Sandefur’s Problems by John Hasnas

    In his response essay, John Hasnas offers solutions to Sandefur’s problems. He suggests that genuine spontaneous orders can be recognized as having no final decision makers, and hence as recognizing a multitude of individual choices. Constructed orders have a final decision maker, and do not respect individual choice. The normative benefits of a spontaneous order are therefore clear: It offers a greater scope for peaceful cooperation, while tending to reduce coercion incrementally. Still, Hasnas admits, spontaneous orders will always be “riddled with injustice,” in part owing to our own limited knowledge and virtue. He suggests that one key missing insight helps rescue much of Hayekian legal thought: the notion that laws, too, respond to market forces.

  • Liberty between the Lines in a Modernist Age by Daniel B. Klein

    Daniel Klein argues that much of the fuzziness in Hayek’s writing was strategic – designed to bring lapsed liberals back into the fold, or to appeal to people who would never accept an unvarnished liberalism. Still, Klein finds great value in Hayek’s work. He argues that, while out of fashion at the time, Hayek’s own willingness to be indeterminate, and to embrace indeterminateness, was both consistent with the Smithian understanding of the social order – and predictive of some of the best work being done today in economics and in other social sciences.

  • Making Sense of Hayek on Spontaneous Order by Bruce Caldwell

    Bruce Caldwell proposes two solutions to Sandefur’s problems. The first is to acknowledge that Hayek was a rule utilitarian, albeit one who recognized that the rules we have inherited are the products of a spontaneous order. The second is to claim that Hayek wasn’t proposing any normative conclusions at all – he was simply making observations in a value-neutral way, as might befit a member of the Austrian School, which was deeply influenced by Max Weber’s ideal of a value-neutral social science. Both approaches have their strengths and weaknesses, Caldwell admits, yet in the end he cannot accept Sandefur’s claim that there is no meaningful distinction between spontaneous and designed orders. Although the difference can be difficult to put into words, we know them when we see them.

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