WE CALL A MULTITUDE of men a society when their activities are mutually adjusted to one another. Men in society can successfully pursue their ends because they know what to expect from their fellows. Their relations, in other words, show a certain order. How such an order of the multifarious activities of millions of men is produced or can be achieved is the central problem of social theory and social policy.1
Sometimes the very existence of such an order is denied when it is asserted that society—or, more particularly, its economic activities—are “chaotic.” A complete absence of an order, however, cannot be seriously maintained. What presumably is meant by that complaint is that society is not as orderly as it should be. The orderliness of existing society may indeed be capable of great improvement; but the criticism is due mainly to the circumstance that both the order which exists and the manner in which it is formed are not readily perceived. The plain man will be aware of an order of social affairs only to the extent that such an order has been deliberately arranged; and he is inclined to blame the apparent absence of an order in much of what he sees on the fact that nobody has deliberately ordered those activities. Order, to the ordinary person, is the result of the ordering activity of an ordering mind. Much of the order of society of which we speak is, however, not of this kind; and the very recognition that there exists such an order requires a certain amount of reflection.
The chief difficulty is that the order of social events can generally not be perceived by our senses but can only be traced by our intellect. It is, as we shall say, an abstract and not a concrete order. It is also a very complex order. And it is an order which, though it is the result of human action, has not been created by men deliberately arranging the elements in a preconceived pattern. These peculiarities of the social order are closely connected, and it will be the task of this essay to make their interrelation clear. We shall see that, although there is no absolute necessity that a complex order must always be spontaneous and abstract, the more complex the order is at which we aim, the more we shall have to rely on spontaneous forces to bring it about, and the more our power of control will be confined in consequence to the abstract features and not extend to the concrete manifestations of that order.2
(The terms “concrete” and “abstract,” which we shall have to use frequently, are often used in a variety of meanings. It may be useful, therefore, to state here in which sense they will be used. As “concrete” we shall describe particular real objects given to observation by our senses, and regard as the distinguishing characteristic of such concrete objects that there are always still more properties of them to be discovered than we already know or have perceived. In comparison with any such determinate object, and the intuitive knowledge we can acquire of it, all images and concepts of it are abstract and possess a limited number of attributes. All thought is in this sense necessarily abstract, although there are degrees of abstractness and it is customary to describe the relatively less abstract in contrast to the more abstract as (relatively) concrete. Strictly speaking, however, the contrast between the concrete and the abstract, as we shall use it, is the same as that between a fact of which we always know only abstract attributes but can always discover still more such attributes, and all those images, conceptions, and concepts which we retain when we no longer contemplate the particular object.3
The distinction between an abstract and a (relatively) concrete order is, of course, the same as that between a concept with a small connotation (intention) and a consequently wide denotation on the one hand, and a concept with a rich connotation and a correspondingly narrow denotation on the other. An abstract order of a certain kind may comprise many different manifestations of that order. The distinction becomes particularly important in the case of complex orders based on a hierarchy of ordering relations where several such orders may agree with respect to their more general ordering principles but differ in others. What is significant in the present context is that it may be important that an order possesses certain abstract features irrespective of its concrete manifestations, and that we may have it in our power to bring it about that an order which spontaneously forms itself will have those desirable characteristics, but not to determine the concrete manifestations or the position of the individual elements.)
THE SIMPLE CONCEPTION of an order of the kind which results when somebody puts the parts of an intended whole in their appropriate places applies in many parts of society. Such an order which is achieved by arranging the relations between the parts according to a preconceived plan we call in the social field an organization. The extent to which the power of many men can be increased by such deliberate co-ordination of their efforts is well-known and many of the achievements of man rest on the use of this technique. It is an order which we all understand because we know how it is made. But it is not the only nor even the chief kind of order on which the working of society rests; nor can the whole of the order of society be produced in this manner.
The discovery that there exist in society orders of another kind which have not been designed by men but have resulted from the action of individuals without their intending to create such an order, is the achievement of social theory—or, rather, it was this discovery which has shown that there was an object for social theory. It shook the deeply-ingrained belief of men that where there was an order there must also have been a personal orderer. It had consequences far beyond the field of social theory since it provided the conceptions which made possible a theoretical explanation of the structures of biological phenomena.4 And in the social field it provided the foundation for a systematic argument for individual liberty.
This kind of order which is characteristic not only of biological organisms (to which the originally much wider meaning of the term organism is now usually confined), is an order which is not made by anybody but which forms itself.
It is for this reason usually called a “spontaneous” or sometimes (for reasons we shall yet explain) a “polycentric” order. If we understand the forces which determine such an order, we can use them by creating the conditions under which such an order will form itself.
This indirect method of bringing about an order has the advantage that it can be used to produce orders which are far more complex than any order we can produce by putting the individual pieces in their appropriate places. But it has the drawback that it enables us to determine only the general character of the resulting order and not its detail. Its use in one sense thus extends our powers: it places us in a position to produce very complex orders which we could never produce by putting the individual elements in their places. Our power over the particular arrangement of the elements in such an order is however much more limited than it is over an order which we produce by individually arranging the parts. All we can control are certain abstract features of such an order, but not its concrete detail.
All this is familiar in the physical and biological field. We could never produce a crystal by directly placing the individual molecules from which it is built up. But we can create the conditions under which such a crystal will form itself. If for that purpose we make use of known forces, we can, however, not determine the position an individual molecule will occupy within a crystal, or even the size or position of the several crystals. Similarly, we can create the conditions under which a biological organism will grow and develop. But all we can do is create conditions favorable to that growth, and we are able to determine the resulting shape and structure only within narrow limits. The same applies to spontaneous social orders.
IN THE CASE OF certain social phenomena, such as language, the fact that they possess an order which nobody has deliberately designed and which we have to discover, is now generally recognized. In these fields we have at last outgrown the naive belief that every orderly arrangement of parts which assist man in the pursuit of his ends must be due to a personal maker. There was a time when it was believed that all those useful institutions which serve the intercourse of men, such as language, morals, law, writing, or money, must be due to an individual inventor or legislator, or to an explicit agreement of wise men who consented to certain useful practices.5 We understand now the process by which such institutions have gradually taken shape through men learning to act according to certain rules—rules which they long knew how to follow before there was any need to state them in words.
But if in those simpler instances we have overcome the belief that, wherever we find an order or a regular structure which serves a human purpose, there must also have been a mind which deliberately created it, the reluctance to recognize the existence of such spontaneous orders is still with us in many other fields. We still cling to a division, deeply embedded in Western thought since the classical antiquity, between things which owe their order to “nature” and those which owe it to “convention.”6 It still seems strange and unbelievable to many people that an order may arise neither wholly independent of human action, nor as the intended result of such action, but as the unforeseen effect of conduct which men have adopted with no such end in mind. Yet much of what we call culture is just such a spontaneously grown order which arose neither altogether independently of human action nor by design, but by a process which stands somewhere between these two possibilities which were long considered as exclusive alternatives.
Such spontaneous orders we find not only in the working of institutions like language or law (or, more conspicuously, the biological organisms) which show a recognizable permanent structure that is the result of slow evolution, but also in the relations of the market which must continuously form and reform themselves and where only the conditions conducive to their constant reconstitution have been shaped by evolution. The genetic and the functional aspects can never be fully separated.7
That division of labor on which our economic system rests is the best example of such a daily renewed order. In the order created by the market, the participants are constantly induced to respond to events of which they do not directly know, in a way which secures a continuous flow of production, a coordination of the quantities of the different things so that the even flow is not interrupted and everything is produced at least as cheaply as anybody can still provide the last quantities for which others are prepared to pay the costs. That it is an order which consists of the adaptation to the multitudinous circumstances which no single person can know completely is one reason why its existence is not perceived by simple inspection. It is embodied in such relations as those between prices and costs of commodities and the corresponding distribution of resources; and we can confirm that such an order in fact exists only after we have reconstructed its principles in our minds.
THE “ORDERING FORCES” of which we can make use in such instances are the rules governing the behavior of the elements of which the orders are formed. They determine that each element will respond to the particular circumstances which act on it in a manner which will result in an overall pattern. Each of the iron filings, for instance, which are magnetized by a magnet under the sheet of paper on which we have poured them, will so act on and react to all the others that they will arrange themselves in a characteristic figure of which we can predict the general shape but not the detail. In this simple instance the elements are all of the same kind and the known uniform rules which determine their behavior would enable us to predict the behavior of each in great detail if we only knew all the facts and were able to deal with them in all their complexity.
Some order of a determinate general character may form itself also from various kinds of different elements, i.e., of elements whose response to given circumstances will be alike only in some but not in all respects. The formation of the molecules of highly complex organic compounds provides an example from the physical sciences. But the fact is especially significant for many of the spontaneous orders which form themselves in the biological and social sphere. They are composed of many different elements which will respond to the same circumstances alike in some respects but not in others. But they will form orderly wholes, because each element responds to its particular environment in accordance with definite rules. The order results thus from the separate responses of the different elements to the particular circumstances which act on them and for this reason we describe it as a “polycentric order.”8
The physical examples of spontaneous orders we have considered are instructive because they show that the rules which the elements follow need of course not be “known” to them. The same is true more often than not where living beings and particularly men are the elements of such an order. Man does not know most of the rules on which he acts;9 and even what we call his intelligence is largely a system of rules which operate on him but which he does not know. In animal societies and in a great measure in primitive human society, the structure of social life is determined by rules of action which manifest themselves only in their being obeyed. It is only when individual intellects begin to differ sufficiently (or individual minds become more complex) that it becomes necessary to express the rules in communicable form so that they can be taught by example and deviant behavior can be corrected and differences of view expressed about what is to be decided.10 Though man never existed without laws which he obeyed, he did exist for millennia without laws which he knew in the sense that he was able to articulate them.
Where the elements of the social order are individual men, the particular circumstances to which each of them reacts are those which are known to him. But it is only when the responses of the individuals show a certain similarity, or obey some common rules that this will result in an overall order. Even a limited similarity of their responses—common rules which determine only some aspects of their behavior—suffice, however, for the formation of an order of a general kind. The important fact is that this order will be an adaptation to a multitude of circumstances which are known only to the individual members but not as a totality to any one of them; and that such an order will result only because, and in so far as, the different individuals follow similar rules in these responses to the particular circumstances known to them. This does not mean, nor is it necessary for the production of an order, that in similar circumstances different persons will do precisely the same thing. All that is meant and required is that in some respect they follow the same rule, that their responses are similar in some degree, or that they are limited to a certain range of actions which all have some attributes in common. This is true even of the iron filings in our former illustration which may not all move with the same speed because they will be different in shape, smoothness, or weight. Such differences will determine the particular manifestation of the resulting pattern which, in consequence of our ignorance of these particulars, will be unpredictable; but the general character of the pattern will be unaffected by them and will therefore be predictable.
Similarly, the responses of the human individuals to events in their environment need be similar only in certain abstract aspects in order that a definite overall pattern should result. There must be some regularity but not complete regularity in their actions: they must follow some common rules, but these common rules need not be sufficient to determine their action fully; and what action a particular individual will take will depend on further characteristics peculiar to him.
The question which is of central importance both for social theory and social policy is what rules the individuals must follow so that an order will result. Some such common rules the individuals will follow merely because of the similarity of their environment, or, rather, because of the similar manner in which this environment reflects itself in their minds. Others they will all follow spontaneously because they are part of the common cultural tradition of their society. But there are still others which it is necessary that they be made to obey, since it would be in the interest of each individual to disregard them, though the overall order will be formed only if the rule is generally obeyed.
The chief regularity in the conduct of individuals in a society based on division of labor and exchange follows from their common situation: they all work to earn an income. This means that they will normally prefer a larger income for a given effort—and possibly increase their effort if its productivity increases. This is a rule which is sufficiently generally followed in fact for those who follow it to impress upon society an order of a certain kind. But the fact that most people follow this rule in their actions leaves the character of the resulting order yet very indeterminate, and it certainly does not by itself insure that this order will be of a beneficent character. For this it is necessary that people also obey certain conventional rules, i.e., rules which do not follow simply from the nature of their knowledge and aims but which have become habitual in their society. The common rules of morals and of law are the chief instance of this.
It is not our task here to analyze the relation between the different kinds of rules which people in fact follow and the order which results from this. We are interested only in one particular class of rules which contribute to the nature of the order and which, because we can deliberately shape them, are the chief tool through which we can influence the general character of the order which will form itself: the rules of law.
These rules differ from the others which individuals follow chiefly by the circumstances that people are made to obey them by their fellows. They are necessary because only if the individuals know what means are at their respective disposals, and are made to bear the consequences of their use of these means, will the resulting order possess certain desirable attributes. The appropriate delimitation of these individual spheres is the main function of the rules of law, and their desirable content one of the chief problems of social policy. This is not altered by the fact that their desirable form has been found largely by the accumulated experience of ages and that their further improvement is also to be expected more from slow experimental piecemeal evolution than from redesign of the whole.
THOUGH THE CONDUCT of the individuals which produces the social order is guided in part by deliberately enforced rules, the order is still a spontaneous order, corresponding to an organism rather than to an organization. It does not rest on the activities being fitted together according to a preconceived plan, but on their being adjusted to each other through the confinement of the action of each by certain general rules. And the enforcement of these general rules insures only the general character of the order and not its concrete realization. It also provides only general facilities which unknown individuals may use for their own ends, but does not insure the achievement of any particular results.
In order to enforce the rules required for the formation of this spontaneous order, an order of the other kind, an organization, is also required. Even if the rules themselves were given once and for all, their enforcement would demand the coordinated effort of many men. The task of changing and improving the rules may also, though it need not, be the object of organized effort. And in so far as the state, in addition to upholding the law, renders other services to the citizens, this also requires an organized apparatus.
The organization of the apparatus of government is also effected in some measure by means of rules. But these rules which serve the creation and direction of an organization are of a different character from those which make possible the formation of a spontaneous order. They are rules which apply only to particular people selected by government; and they have to be followed by them in most instances (i.e., except in the case of judges) in the pursuit of particular ends also determined by government.
Even where the type of order chosen is that of organization and not a spontaneous order, the organizer must largely rely on rules rather than specific commands to the members of the organization. This is due to the fundamental problem which all complex order encounters: the organizer wants the individuals who are to cooperate to make use of knowledge which he himself does not possess. In none but the most simple kinds of social order it is conceivable that all activities are governed by a single mind. And certainly nobody has yet succeeded in deliberately arranging all the activities of a complex society; there is no such thing as a fully planned society of any degree of complexity. If anyone did succeed in organizing such a society, it would not make use of many minds but would instead be altogether dependent on one mind; it would certainly not be complex but very primitive—and so would soon be the mind whose knowledge and will determine everything. The facts which enter into the design of such an order could be only those which could be perceived and digested by this mind; and as only he could decide on action and thus gain experience, there could not be that interplay of many minds in which a lone mind can grow.
The kind of rules which govern an organization are rules for the performance of assigned tasks. They presuppose that the place of each individual in a fixed skeleton order is decided by deliberate appointment, and that the rules which apply to him depend on the place he has been given in that order. The rules thus regulate only the detail of the action of appointed functionaries or agencies of government—or the functioning of an organization created by arrangement.
Rules which are to enable individuals to find their own places in a spontaneous order of the whole society must be general; they must not assign to particular individuals a status, but rather leave the individual to create his own position. The rules which assist in the running of an organization, on the other hand, operate only within a framework of specific commands which designate the particular ends which the organization aims at and the particular functions which the several members are to perform. Though applicable only to particular, individually designated people, these rules of an organization look very much like the general rules underlying a spontaneous order, but they must not be confused with the latter. They enable those who have to carry out commands to fill in detail according to circumstances which they, but not the author of the command, know.
In the terms we have used, this means that the general rules of law aim at an abstract order whose concrete or particular manifestation is unpredictable; while both the commands and the rules which enable those who obey commands to fill in the detail left open by the command, serve a concrete order or an organization. The more complex the order aimed at, the greater will be the part of the circumstances determining its concrete manifestation which cannot be known to those whose concern it is to secure the formation of the order, and the more they will be able to control it only through rules and not through commands. In the most complex type of organizations little more than the assignment of particular functions to particular people will be determined by specific decisions, while the performance of these functions will be regulated only by rules. It is when we pass from the biggest organization, serving particular tasks, to the order of the whole of society which comprises the relations between those organizations as well as the relations between them and the individuals and among the individuals, that this overall order relies entirely on rules, i.e., is entirely of a spontaneous character, with not even its skeleton determined by commands. The situation is, of course, that, because it was not dependent on organization but grew as a spontaneous order, the structure of modern society has attained a degree of complexity which far exceeds that which it is possible to achieve by deliberate organization. Even the rules which made the growth of this complex order possible were not designed in anticipation of that result; but those peoples who happened to adopt suitable rules developed a complex civilization which prevailed over others. It is thus a paradox, based on a complete misunderstanding of these connections, when it is sometimes contended that we must deliberately plan modern society because it has grown so complex. The fact is rather that we can preserve an order of such complexity only if we control it not by the method of “planning,” i.e., by direct orders, but on the contrary aim at the formation of a spontaneous order based on general rules.
We shall presently have to consider how in such a complex system the different principles of order must be combined. At this stage it is necessary, however, at once to forestall a misunderstanding and to stress that there is one way in which it can never be sensible to mix the two principles. While in an organization it makes sense, and indeed will be the rule, to determine the skeleton by specific command and regulate the detail of the action of the different members only by rules, the reverse could never serve a rational purpose; if the overall character of an order is of the spontaneous kind, we cannot improve upon it by issuing to the elements of that order direct commands: because only these individuals and no central authority will know the circumstances which make them do what they do.
EVERY SOCIETY of any degree of complexity must make use of both ordering principles which we have discussed. But while they must be combined by being applied to different tasks and to the sectors of society corresponding to them, they cannot successfully be mixed in any manner we like. Lack of understanding of the difference between the two principles constantly leads to such confusion. It is the manner in which the two principles are combined which determines the character of the different social and economic systems. (The fact that these different “systems” which result from different combinations of the two ordering principles, are sometimes also referred to as different “orders” has added to the terminological confusion.)
We shall consider further only a free system which relies on spontaneous ordering forces not merely (as every system must) to fill in the interstices left by the commands determining its aim and structure, but also for its overall order. Such systems not only have many organizations (in particular, firms) as their elements but also require an organization to enforce obedience to (and modify and develop) the body of abstract rules which are required to secure the formation of the spontaneous overall order. The fact that government is itself an organization and employs rules as an instrument of its organization, and that beyond its task of enforcing the law this organization renders a multitude of other services, has led to a complete confusion between the nature of the different kinds of rules and the orders which they serve.
The abstract and general rules of law in the narrow sense (in which “the law” comprises the rules of civil and criminal law) aim not at the creation of an order by arrangement but at creating the conditions in which an order will form itself. But the conception of law as a means of order-creation (a term which, as a translation of the equally ambiguous German Ordnungsgestaltung, is now invading Anglo-American jurisprudence11 ) in the hands of public lawyers and civil servants who are primarily concerned with tasks of organization rather than with the conditions of the formation of a spontaneous order, is increasingly interpreted as meaning an instrument of arrangement. This conception of law, which is the conception prevailing in totalitarian states, has characteristically been given its clearest expression by the legal theorist who became Hitler’s chief legal apologist, as “concrete order formation” (konkretes Ordnungsdenken).12 This kind of law aims at creating a concrete preconceived order by putting each individual on a task assigned by authority.
But though this technique of creating an order is indispensable for organizing the institutions of government and all the enterprises and households which form the elements of the order of society as a whole, it is wholly inadequate for bringing about the infinitely more complex overall order.
We have it in our power to assure that such an overall order will form itself and will possess certain desirable general characteristics, but only if we do not attempt to control the detail of that order. But we jettison that power and deprive ourselves of the possibility of achieving that abstract order of the whole, if we insist on placing particular pieces into the place we wish them to occupy. It is the condition of the formation of this abstract order that we leave the concrete and particular details to the separate individuals and bind them only by general and abstract rules. If we do not provide this condition but restrict the capacity of the individuals to adjust themselves to the particular circumstances known only to them, we destroy the forces making for a spontaneous overall order and are forced to replace them by deliberate arrangement which, though it gives us greater control over detail, restricts the range over which we can hope to achieve a coherent order.
IT IS NOT IRRELEVANT to our chief purpose if in conclusion we consider briefly the role which abstract rules play in the coordination not only of the actions of many different persons but also in the mutual adjustment of the successive decisions of a single individual or organization. Here, too, it is often not possible to make detailed plans for action in the more distant future (although what we should do now depends on what we shall want to do in the future), simply because we do not yet know the particular facts which we shall face. The method through which we nevertheless succeed in giving some coherence to our actions is that we adopt a framework of rules for guidance which makes the general pattern though not the detail of our life predictable. It is these rules of which we are often not consciously aware—in many instances rules of a very abstract character—which make the course of our lives orderly. Many of these rules will be “customs” of the social group in which we have grown up and only some will be individual “habits” which we have accidentally or deliberately acquired. But they all serve to abbreviate the list of circumstances which we need to take into account in the particular instances, singling out certain classes of facts as alone determining the general kind of action which we should take. At the same time, this means that we systematically disregard certain facts which we know and which would be relevant to our decisions if we knew all such facts, but which it is rational to neglect because they are accidental partial information which does not alter the probability that, if we could know and digest all the facts, the balance of advantage would be in favor of following the rule.
It is, in other words, our restricted horizon of knowledge of the concrete facts which makes it necessary to coordinate our actions by submitting to abstract rules rather than to attempt to decide each particular case solely in view of the limited set of relevant particular facts which we happen to know. It may sound paradoxical that rationality should thus require that we deliberately disregard knowledge which we possess; but this is part of the necessity of coming to terms with our unalterable ignorance of much that would be relevant if we knew it. Where we know that the probability is that the unfavorable effects of a kind of action will overbalance the favorable ones, the decision should not be affected by the circumstance that in the particular case a few consequences which we happen to be able to foresee should all be favorable. The fact is that in an apparent striving after rationality in the sense of fuller taking into account all the foreseeable consequences, we may achieve greater irrationality, less effective taking into account of remote effects and an altogether less coherent result. It is the great lesson which science has taught us that we must resort to the abstract where we cannot master the concrete. The preference for the concrete is to renounce the power which thought gives us. It is therefore also not really surprising that the consequence of modern democratic legislation which disdains submitting to general rules and attempts to solve each problem as it comes on its specific merits, is probably the most irrational and disorderly arrangement of affairs ever produced by the deliberate decisions of men.
[1 ] The concept of order has recently achieved a central position in the social sciences largely through the work of Walter Eucken and his friends and pupils, known as the Ordo-circle from the yearbook Ordo issued by them. For other instances of its use, see: J. J. Spengler, “The Problem of Order in Economic Affairs,” Southern Economic Journal, July, 1948, reprinted in J. J. Spengler and W. R. Allen, eds., Essays on Economic Thought (Chicago: Rand McNally, 1960); H. Barth, Die Idee der Ordnung (Zurich: E. Rentsch, 1958); R. Meimberg, Alternativen der Ordnung (Berlin: Duncker & Humblot, 1956); and, more remotely relevant as a treatment of some of the philosophical problems involved, W. D. Oliver, Theory of Order (Yellow Springs, Ohio: Antioch Press, 1951).
[2 ] For a more extensive treatment of the problem of the scientific treatment of complex phenomena, see my essay, “The Theory of Complex Phenomena,” in Mario A. Bunge, ed.; The Critical Approach: Essays in Honor of Karl Popper (New York: The Free Press of Glencoe, Inc., 1963).
[3 ] For a helpful survey of the abstract/concrete relation and especially its significance in jurisprudence, see K. Englisch, Die Idee der Konkretisierung in Rechtswissenschaft unserer Zeit (Heidelberg: Abhandlungen der Heidelberger Akademie der Wissenschaften, Phil.-Hist. Klasse, I, 1953).
[4 ] All three independent discoverers of biological evolution, Darwin, Wallace, and Spencer, admittedly derived their ideas from the current concepts of social evolution.
[5 ] Cf., e.g., the examples given by Denys Hay, Polydore Vergil (Oxford: Clarendon Press, 1952), ch. 3.
[6 ] Cf. F. Heinimann, Nomos und Physis (Basel: F. Reinhardt, 1945).
[7 ] On the inseparability of the genetic and the functional aspects of these phenomena as well as the general relation between organisms and organizations, see Carl Menger, Untersuchungen uber die Methode der Sozialwissenschaften und der politischen Oekonomie insbesondere (Leipzig: Duncker & Humblot, 1883), which is still the classical treatment of these topics.
[8 ] Cf. Michael Polanyi, The Logic of Liberty (London: Routledge and Kegan Paul, 1951), p. 159.
[9 ] On the whole issue of the relation of unconscious rules to human action, on which I can touch here only briefly, see my essay, “Rules, Perception, and Intelligibility,” Proceedings of the British Academy, v. 48 (1962-63).
[10 ] There thus seems to be some truth in the alleged original state of goodness in which everybody spontaneously did right and could not do otherwise, and to the idea that only with increased knowledge came wrongdoing. It is only with the knowledge of other possibilities that the individual becomes able to deviate from the established rules; without such knowledge, no sin.
[11 ] Cf., e.g., E. Bodenheimer, Jurisprudence, the Philosophy and Method of Law (Cambridge: Harvard University Press, 1962), p. 211.
[12 ] See Carl Schmitt, Die drei Arten des rechtswissenschaftlichen Denkens (Hamburg: Schriften fur Akademie fur deutsches Recht, 1934).
Law, Legislation and Liberty: Cosmos and Taxis
Hayek, Friedrich A. Von.
(1982). Law, legislation, and liberty : a new statement of the liberal
principles of justice and political economy (New pbk. ed.). London: Routledge
and Kegan Paul.
Chapter 2: Cosmos and Taxis
Hayek spends this chapter distinguishing between two types of orders: those
that are made and those that are grown.
“By ‘order’ we shall throughout describe a state of affairs in which a multiplicity of elements of various kinds are so related to each other that we may learn from our acquaintance with some spatial or temporal part of the whole to form correct expectations concerning the rest, or at least expectations which have a good chance of proving correct” (36).
He claims that the concept of order has been hijacked by those who
favor authoritarianism, as they see it relating to command and obedience. “A
spontaneous order…has in many respects properties different from those of a
made order” (36).
Spontaneous orders have been studied for a long time
in the field of economics and biology, claims Hayek. These orders focus on
self-organization and self-generation. These orders are endogenous to a system.
On the other hand, made orders are exogenously controlled; these are constructions
and can be called organizations.
The title of this chapter derives from Greek words
that separate made orders from spontaneous orders. “Taxis”
is an order that is constructed, much like, “an order of battle”. “Kosmos”, on
the other hand, is a grown order, or a spontaneous order.
“One of our main contentions will be that very complex orders, comprising more
particular facts than any brain could ascertain or manipulate, can be brought
about only through forces inducing the formation of spontaneous orders” (38).
These systems have drivers that abstractly relate to one another. To preserve
these orders, all one needs, “…is that a certain structure of relationships be
maintained…” (39). These orders have no overarching purpose, or telos (not his
words), though they can prove very handy for individuals and groups of people.
These orders involve the regular interaction of small units that are relatively
consistent. “The important point is that the regularity of the conduct of the
elements will determine the general character of the resulting order but not
all the detail of its particular manifestation” (40). And, to prediction:
“…we shall be able to predict only the general character of the order that will
form itself, and not the particular position which any particular element will
occupy relatively to any other element” (40).
Spontaneous orders arise because all of the elements that are compromise these
orders obey simple sets of rules in their, “…responses to their immediate
environment” (43). Some of these rules, for example, can be seen in human
interaction in the market place. “In a modern society based on exchange, one of
the chief regularities in individual behavior will result from the similarity
of situations in which most individuals find themselves in working to earn an
income; which means that they will normally prefer a larger return from their
efforts to a smaller one, and often that they will increase their efforts in a
particular direction if the prospects of return improve. This is a rule that will
be followed at least with sufficient frequency to impress u8pon such a society
an order of a certain kind” (45).
While society has the features of a spontaneous
order, a government, or made order, also exists. These two orders
co-exist. The example of a cell and a cell’s nucleus is used to explain this
relationship. The government is meant to fill the role of a, “maintenance squad
of a factory” (47), or the group that keeps everything free to operate smoothly
on its own.
Organizations, just like spontaneous orders, also
rely on rules. This is so that the corporate knowledge can exceed
that of any individual. This knowledge is far and above what any one individual
can possess, and thus it is impossible to constrain through made orders. A
spontaneous order, “…arises from each element balancing all the various factors
operating on it and by adjusting all its various actions to each other, a
balance which will be destroyed if some of the actions are determined by
another agency on the basis of different knowledge and in the service of
different ends. What the general argument against ‘interference’ thus
amounts to is that, although we can endeavor to improve a spontaneous order by
revising the general rules on which it rests, and can supplement its results by
the efforts of various organizations, we cannot improve the results by
specific commands that deprive its members of the possibility of using their
knowledge for their purposes” (51).
Humans can not know the effects of their policy interventions. Thus, “…the only
possibility of transcending the capacity of individual minds is to rely on
those super-personal ‘self-organizing’ forces which create spontaneous orders”
(54).
Posted by Jonathan at 12:22 PM
TWO KINDS OF ORDER John Marks
I wish to draw attention to some ideas of Friedrich von Hayek concerning phenomena which are, 'the result of human action, but not the execution of any human design' (Adam Ferguson An Essay on the History of Civil Society, London, 1767; quoted in Law, Legislation and Liberty, (hereafter LLL) Vol. I, p. 20 and note 19, p. 150). Hayek distinguishes three sources of human values - those 'which are genetically determined and therefore innate'; those which are 'products of rational thought'; and those which are the result of cultural evolution. He emphasises the importance of the third of these - cultural evolution - and he considers that many people either ignore or underrate its significance. (LLL, III, p. 153). I believe that these ideas of Hayek's can help us to understand the market, science, and language; they also cast light on the structures of both liberal and socialist societies.
Hayek distinguishes two kinds of rationalism; what he has called constructive rationalism and evolutionary rationalism. And he associates these with two kinds of order: designed or made orders and spontaneous orders. Constructive rationalism derives from Descartes with his twin emphases on logical or mathematical deduction from explicit premises, and on machines as appropriate models for explaining natural phenomena, however complex. According to constructive rationalism, rational actions are those which are determined entirely by known and demonstrable truths, and rational social institutions are those which are deliberately designed to achieve specific, defined purposes.
Constructive rationalism gives rise to designed or made orders, like cars, or silicon chips, buildings or factories, armies or planned economies. All of these have been designed for one or several definite purposes. It is the very success of constructive rationalism in some of these examples - particularly in the less complex situations - that leads to the assumption that all social institutions and all other human productions are, and ought to be, the product of deliberate design.
But such design is neither actual nor feasible. It is not possible for any individual or small group to know all the relevant facts needed to design complex social institutions. To think that this is possible is to suffer from what Hayek calls the synoptic delusion. And many of the social institutions which are indispensable in a modern industrial society have not been consciously designed.
Hence we need to recognise the importance of evolutionary rationalism and of self-generating or spontaneous orders to which the ideas of purpose and design do not apply. Organisms, languages, market economies, societies are orders which were not designed: they evolved. Evolutionary rationalists insist on the distinction between designed and spontaneous orders, especially in understanding man and society.
Man is seen as a rule-following animal as well as a purposive one, and human culture as partly an order of rules which we inherit, and only partly as an order of rules which have been either designed or fully explicated. Many rules and institutions have evolved, and have been strengthened and refined by selection. Man has often been successful because he observed rules, not because he understood why de did so. It is not in any way irrational to follow rules we do not clearly understand. For example, even today we have only a small understanding of the structure of language - yet without language virtually nothing of our culture would exist. So evolutionary rationalists argue that the evolution of social rules and institutions is as important for understanding man and society as is biological evolution for understanding man as a species.
But to recognise this is not to deny the importance of constructive rationalism in limited areas. In almost all real situations, both kinds of rationalism are involved. If we recognise this, we can appreciate more accurately the potential benefits and limitations of conscious design. We shall also, be able, I hope, to distinguish situations where the constructive rationalist model will be most fruitful. A complex self-generating order of individuals, institutions and organisations, which is a modern society, makes continual use of constructive rationalism in limited areas., but in its totality such a society bears little resemblance to a machine. However, if we adopt a constructive rationalist approach and attempt to plan the whole of our society - just as if it were a machine - then we will be moving in a totalitarian direction.
The examples I wish to discuss - the market, science, language, and the structures of liberal societies - all show common features.
1. They all make use of constructive rationalism in limited areas. It is very difficult to think of pure-bred examples of either kind of rationalism.
2. The systems involved are so complex that it is inconceivable that any individual could know all the facts which are relevant to their functioning.
3. Consequently these spontaneous orders have evolved decentralised mechanisms for transmitting information which overcome the limitations of individual knowledge. The development of such mechanisms is a necessary condition for the formation of complex spontaneous orders.
4. A framework of rules is required if the information transmission mechanism of a spontaneous order is to function and the order to survive. These rules are partly explicit and partly tacit, and may in some cases be reinforced by a commonly accepted system of values.
5. By their very nature, spontaneous orders evolve diverse mechanisms for correcting errors or imperfections. These self-correcting mechanisms, which in some ways resemble 'negative feedback loops' in mechanical or electrical systems or homeostatic mechanisms in biological systems, operate at many levels in a spontaneous order, in ways which are scarcely possible in a made order.
The classic example of an evolved or spontaneous order is a market economy. As Hayek puts it- 'We have never designed our economic system. We were not intelligent enough for that'. (LLL, III, p. 164). A market economy is one in which many individuals or organisations may plan their detailed activities by using a constructive rationalistic approach, but which in its totality forms a complex order whose details are not known to anybody. This complex order functions effectively because of one singular fact: the market prices obtaining under competition transmit information throughout the whole system. It is this information, transmitted through prices, which enables each part of the system to respond to the rest and to plan its own detailed activities.
If such an economy is to function effectively, central government must maintain the conditions required for the decentralised transmission of information. Governments must maintain order both internally and externally, and create a legal framework - including laws of property, contract and tort - which allows the market order to function. But the attempt to do more than that may endanger the price mechanism and its crucial role of transmitting information. How much more is permissible on the part of government has therefore been a matter for argument ever since the time of Adam Smith. Questions like, 'Which social services are public goods that cannot be provided by the market?' and, 'How large can the public sector be?' are not easy to answer. What we can say is that governments must not succumb to the synoptic delusion by adopting detailed economic planning, or by administering prices. For they can neither possess the knowledge required to do this, nor explicitly understand the detailed mechanisms which enable modern complex economies to function. Thus, ' . . . if anything is certain it is that no person who was not already familiar with the market could have designed the economic order which is capable of maintaining the present numbers of mankind'. (LLL, III, p. 164).
So far, what I have been saying is neither especially new nor controversial. But I suspect that my next example of evolutionary rationalism - modern science - may be much more contentious. For it is a widely accepted image that modern science is a particularly successful example of constructive rationalism. This image, which dates from the mechanical philosophy of the 17th century and from the writings of Descartes in particular, is influential, superficially plausible, but wrong. More than that; I believe it to be almost the opposite of the truth.
The image has gained its hold for two reasons. First, constructive rationalism has been very successfully applied in science in limited areas; this is especially true of the mathematical sciences. Secondly, scientific papers are written, for very good reasons, in ways which overemphasise the constructive rationalist aspects of scientific work (cf. Sir Peter Medawar's well-known essay - 'Is the Scientific Paper a Fraud?').
But when we consider the whole body of scientific knowledge, and the complex mode of operation of the international scientific community, we see that the constructive rationalist model is inadequate. The body of scientific knowledge is made up of a vast network of theories, experiments and observations, recorded in multifarious papers, monographs and textbooks. It is so vast and complex that nobody can be aware of more than a fraction of it. At the same time, it is not just a random assortment of separate and disconnected items of knowledge. The parts are interrelated in many complex ways, and the whole has a structure which has been designed or made or planned. The whole body of knowledge has evolved in many diverse, unplanned and unpredictable ways, and it has many of the characteristics of a spontaneous order.
These characteristics are even more apparent when we consider the structure, not of scientific knowledge, but of the scientific community and the way it operates. The scientific community is made up of individuals, scientific societies, learned journals and institutions of higher education and research, all of which are in continual interaction. The structure is now very complex: for example, there are estimated to be around 30,000 scientific journals currently being published. This structure has also grown and evolved in a spontaneous way from its rudimentary origins in the 17th century, in parallel with the growth in the body of scientific knowledge over the same period.
Its primary purpose is the transmission of reliable information throughout the whole complex system. It achieves this by using two main criteria; first, logical coherence, and the use of all available relevant evidence in judging claims to knowledge; and secondly, the practice of exposing such claims to open, public criticism.
The second main function of the scientific community is to maintain the conditions which enable this decentralised process of information transmission to operate. It does this by institutionalising the criteria of logic and evidence, and by fostering the values of openness, criticism, pluralism, individual academic freedom and tentativeness. In this way, the whole scientific community can generate and use a vastly greater stock of collectively validated knowledge than any individual or centralised group. At the same time, the system of continual public criticism and evaluation has the great advantage of enabling faulty work to be eliminated.
It is clear that any attempt to plan or direct the course of future scientific development is likely to fail - not only because future discoveries, by their very nature, cannot be predicted, but also because individuals or small groups cannot possess all the details even of our present knowledge; nor can they explicitly understand and control the detailed mechanisms by which scientific knowledge is acquired.
Thus scientific knowledge and the scientific community together form a complex spontaneous order which has many similar features to a market economy. It has evolved rather than been designed, it operates through a decentralised system of information transmission whose maintenance is the prime function of its governing body, and it contains many self-correcting mechanisms which enable errors or mistakes to be eliminated. Moreover, as with the market, it is inconceivable that anyone could have designed the scientific order which over the last three centuries has created the most significant and universal body of interlocking theoretical and empirical human knowledge yet achieved.
At first sight it may seem surprising that two such different areas of human activity as a market economy and modern science should show so many common features. But I believe that this is no accident. I also believe that there are other suggestive parallels and analogies which are worth exploring - analogies between science and language, and between evolutionary and constructive rationalism and the structures and values of liberal and socialist societies respectively. I realise that these are deep waters and therefore I put forward my ideas tentatively in what I hope is the true Popperian spirit of conjecture and refutation. In other words, I offer my conjectures, and invite my readers to refute them.
Human languages are spontaneous orders which have many important similarities with science - particularly if we accept the view of science as a redescription of the world. Natural languages are not designed; they are the products mainly of evolutionary rather than constructive rationalism. The artificial languages for which this is not true - mathematical and computer languages - are special cases, which lack many of the essential characteristics of natural languages.
Languages deal with and describe the natural world, a world which is so complex that any individual attempt to describe it, and make sense of it, can only capture part of it. In order to survive, each individual must make some sense of his environment, most fundamentally by acquiring a language. But the language of each individual (his idiolect) only functions effectively if it forms part of a wider structure such as the language of a group, a region or a nation. So our languages are complex decentralised mechanisms for transmitting information. And we use them confidently without much explicit understanding of their structure or of how they develop. A framework of rules governs the forms which natural languages take. But these rules are concerned with the structure rather than the content of what we say. This is true both for the socially transmitted grammatical rules which are specific to each language, and for the deep structures or linguistic universals which Chomsky claims are common to all human languages (cf. Geoffrey Sampson, Liberty and Language, Oxford, 1979). Hence languages exhibit the same common features as the other spontaneous orders I have mentioned. Nor is the analogy destroyed by the fact that in this case part of the governing framework of rules - Chomsky's deep structure - appears to be innate rather than man-made.
There is a further respect in which languages resemble markets and science. Like these last two institutions, they incorporate self-correcting or error-eliminating mechanisms. Linguistic forms which do not lead to effective communication tend not to persist; more successful forms persist, and gradually evolve into more permanent features of the language. Natural languages have the interesting property that partially incoherent or ungrammatical statements can transmit some information, although they may also lead to misunderstandings. This is not a property of such products of constructive rationalism as computer languages, where one error is often enough to destroy completely the meaning of a statement. Again, unlike computer languages, the very complexity of natural languages may lead to differences in interpretation and a lack of communication - as when two people use the same word in different ways.
Yet another similarity exists between language and other institutions of spontaneous order. This is the essentially personal character of language: the fact that much of our linguistic experience and knowledge is personal, tacit and never fully conveyed to anyone else. Similarly, much of scientific knowledge and experience had a strong personal element of this kind (a point particularly emphasised by Michael Polanyi in his books The Tacit Dimension and Personal Knowledge).
I have already stressed the importance of evolutionary rationalism in understanding modern complex societies. I indicated that such societies, while they may use constructive rationalism in limited areas, in their totality have evolved rather than been designed. Moreover, they are so complex that they need to develop and maintain decentralised mechanisms for information transmission; and these mechanisms provide such societies with adaptive or self-correcting properties.
I want now to try to illustrate these points by contrasting two very different kinds of society - liberal (capitalist) societies and socialist (Marxist) societies. I suggest that the fundamental differences between liberal and socialist societies arise because liberal societies depend primarily on evolutionary rationalism and spontaneous order, whereas the structures of socialist societies take constructive rationalism and designated order as their model.
Ideally, liberal societies are fundamentally decentralised. All the main spheres of human life - economic, political, educational, cultural, religious - are partially separated. And within each sphere, pluralism is, to some extent, both encouraged and realised - diverse centres of economic power, many political parties, diversity of provision in education and other cultural spheres, many coexisting religions. The resulting complex order is underpinned by the values of tolerance, pluralism and individual freedom, and, in particular, by freedom of expression, communication and access to information. It is clearly impossible to plan the overall development of such a society even if short-term developments in some areas can be planned.
By contrast, Marxist societies are centralised and monolithic. Their governments attempt to control all aspects of life. They have centrally planned economies and only one political party possesses any substantial reality. This party controls all educational and cultural activities. Freedom of expression and of access to information are expressly prevented, and the values which are encouraged are those of collective commitment to the centralised rule of the party. Anything which the party does is to be approved and anything which threatens its central role is condemned and suppressed. Marxist societies have clearly tried to organise themselves according to the principles of constructive rationalism. But, as I have argued, such principles are antithetical to the effective functioning of many essential institutions of modern complex societies. So there develops a great gulf between promise and performance in Marxist states. And this gulf persists because of the lack of self-correcting mechanisms in a system based on constructive rationalism.
This analysis may help to explain why the Gulag Archipelago has lasted so long and cost so many millions of lives, why the charlatan Lysenko ruled Soviet biology for more than forty years, and why the Great Soviet Encyclopaedia still does not list five of the eight men who have been premiers of the USSR since the revolution.
All the examples of spontaneous orders have one major common characteristic - they are all concerned with how we gradually learn about our environment and how we adapt to it. Successful learning and adaptation are facilitated if the environment is relatively stable. So this partly explains why the kind of knowledge we have been able to acquire about the relatively stable natural world - via language and science - is of a more durable and cumulative kind than that which we have acquired about the more plastic social and political worlds. And the knowledge or information transmitted by the market is the most transient of all, reflecting as it does the current economic situation. But this does not mean that all economic knowledge is transient any more than the transient nature of the spoken word implies that we can learn nothing enduring about language. If my analysis is valid, it should be just as possible to build up a cumulative body of knowledge in economics as it is in linguistics.
Therefore I would contend that we can aspire to appreciate how the market and other complex spontaneous orders function. The work of Hayek has made is possible for us to generalise some of the insights of Adam Smith, in ways which it may be vital for us to understand if our society is to survive. It has also displayed the dangers involved in trying to organise societies according to the constructive rationalist model, as socialists advocate and practise. I shall conclude with some of Hayek's own words:
If our civilization survives, which it will do only if it renounces those errors, I believe men will look back on our age as an age of superstition chiefly connected with the names of Karl Marx and Sigmund Freud. I believe people will discover that the most widely held ideas which dominated the twentieth century, those of a planned economy with a just distribution, a freeing ourselves from repressions and conventional morals, or permissive education as a way to freedom, and the replacement of the market by a rational arrangement of a body with coercive powers, were all based on superstitions in the strict sense of the word. An age of superstitions is a time when people imagine that they know more than they do. In this sense the twentieth century was certainly an outstanding age of superstition, and the cause of this is an over-estimation of what science has achieved - not in the field of the comparatively simple phenomena, where it has of course been extraordinarily successful, but in the field of complex phenomena, where the application of the techniques which proved so helpful with essentially simple phenomena has proved to be very misleading.
Ironically, these superstitions are largely an effect of our inheritance from the Age of Reason, that great enemy of all that it regarded as superstitions. If the enlightenment has discovered that the role assigned to human reason in intelligent construction had been too small in the past, we are discovering that the task which our age is assigning to the rational construction of new institutions is far too big. What the age of rationalism - and modern positivism - has taught us to regard as senseless and meaningless formations due to accident or human caprice, turn out in many instances to be the foundations on which our capacity for rational thought rests. Man is not and never will be the master of his fate: his very reason always progresses by leading him into the unknown and unforeseen where he learns new things.
To which it is fitting to add the words of Isaac Newton - the man whose scientific work inspired many of the men of the Enlightenment but who as a lifelong opponent of that prime advocate of constructive rationalism, Descartes:
I do not know what I may appear to the world; but to myself I seem to have been only like a boy playing on the sea-shore, and diverting myself in now and then finding a smoother pebble or a prettier shell than ordinary, while the great ocean of truth lay all undiscovered before me.
John Marks, London 1985