Karl Popper's methodology highlights our scientific ignorance: hence the need to institutionalize open‐mindedness through controlled experiments that may falsify our fallible theories about the world. In his endorsement of “piecemeal social engineering,” Popper assumes that the social‐democratic state and its citizens are capable of detecting social problems, and of assessing the results of policies aimed at solving them, through a process of experimentation analogous to that of natural science. But we are not only scientifically but politically ignorant: ignorant of the (...) facts that underpin political debate, which are brought to our attention by theories that, as Max Weber emphasized, can be tested only through counterfactual thought experiments. Public‐opinion and political‐psychology research suggest that human beings are far too unaware, illogical, and doctrinaire to conduct the rigorous theorizing that would be necessary to make piecemeal social engineering work. F.A. Hayek realized that the public could not engage, specifically, in piecemeal economic regulation but failed to draw the conclusion that this was due to a specific type of political ignorance: ignorance of economic theory. (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)

In “Popper, Weber, and Hayek,” I claimed that the economic and political world governed by social democracy is too complex to offer hope for rational social‐democratic policy making. I extrapolated this conclusion from the claim, made by Austrian‐school economists in the 1920s and 30s, that central economic planning would face insurmountable “knowledge problems.” Israel Kirzner's Reply indicates the need to keep the Austrians’ cognitivist argument conceptually distinct from more familiar incentives arguments, which can tacitly reintroduce the assumption of omniscience (...) against which the Austrian economists rebelled. Callahan's Reply illustrates the need to keep in mind the hypothetical, conditional nature of economic arguments. Notturno's Reply changes the subject by asserting the intrinsic value of social‐democratic participation, regardless of its outcomes—even while, like Talisse's Reply, ignoring the evidence that public ignorance and elite dogmatism probably can't be mitigated by more information or by appeals to be open minded. And Hill focuses on the very real imperfections of market and other private‐sphere decision making, without weighing the shortcomings of the political alternatives. Markets and other private‐sphere decision arenas don't have to be perfect for them to improve upon public‐sector processes. In the latter, cognitive demands tend to be much greater, because of the divergence of modern social problems from the conditions that would have faced the hunter‐gatherers whose cognitive apparatus we have inherited. (shrink)

Markets can be said to overcome ignorance in two senses. First, in an imaginary world of economic equilibrium, market prices can signal to consumers how they may alter their behavior so as to conform to supply and demand conditions of which they are ignorant. This is a point that was underscored by F.A. Hayek and, now, by Jeffrey Friedman. But the more important manner in which markets overcome ignorance was identified by Hayek's mentor, Ludwig von Mises, and (...) is not mentioned by Friedman: when market prices are not perfectly aligned to supply and demand conditions (and they never are), they present profit opportunities to entrepreneurs who are alert to make such discoveries. Their profit‐motivated actions then reallocate resources in a pattern more efficiently reflecting the true supply and demand conditions. It is this way of overcoming ignorance that most clearly separates the market arena from the political arena, because no corresponding corrective discovery process exists in politics. (shrink)

Hayek's case for the limits of economic agents’ knowledge does not, as Greg Hill seems to suggest, imply that government should be in the business of engaging in countercyclical fiscal policy or paternalistic corrections of people's pursuit of “imaginary goods.” In the latter case, markets have corrective learning mechanisms for consumer mistakes. In the former, public‐choice and public‐ignorance problems plague government efforts to correct the business cycle. The problem of public ignorance is, in turn, Jeffrey Friedman's topic, but (...) he is unfair in condemning Hayek's abandonment of this problem in order to develop his thesis that a “planning mentality” was the source of the leftist ideas with which Hayek disagreed. Hayek was confronted by widely popular planning schemes that were endorsed by a great many of his colleagues, who were not ignorant of economics. (shrink)

Jeffrey Friedman credits Popper for calling attention to our scientific ignorance, but faults him for failing to recognize that we are at least as ignorant about politics as we are about science. He also credits Hayek for realizing that the public could not successfully engage in piecemeal economic regulation, but faults him for not recognizing that this is due to the public's ignorance of economic theory. Friedman suggests that the types of ignorance overlooked by Popper and (...) class='Hi'>Hayek compromise the very possibility of democracy—or at least social democracy. He assumes, however, that the success of social democracy and “piecemeal social engineering” depend upon their ability to produce “good” policies. This does not do justice to Popper's views about democracy and piecemeal engineering, and it also presumes an underlying economism that Popper criticized—but to which Friedman and Hayek adhere. (shrink)

In “Popper, Weber, and Hayek: The Epistemology and Politics of Ignorance,” Jeffrey Friedman argues that markets are superior to democratic institutions because the price system doesn't require people to make the kind of difficult counterfactual judgments that are necessary in order to evaluate public‐policy alternatives. I contend that real‐world markets require us to make all kinds of difficult counterfactual judgments, that the nature of these judgments limits the effectiveness of the price system in coordinating our activities, and that (...) the market participant who is capable of making reasonably good economic judgments can also become the kind of well‐informed citizen who is essential to democratic self‐government. (shrink)

This book describes the philosophical principles underlying the doctrine (the political project) often called “classical liberalism”. By this expression we mean, in this book, the project for society proposed, during the second half of the eighteenth century, by David Hume and Adam Smith in Great Britain, Turgot and Condorcet in France, Thomas Jefferson in the United States and Kant and Humboldt in Germany. The differences between the principles of “classical liberalism” and those of the extreme doctrines of Milton Friedman (...) and Friedrich Hayek (often confused with 'classical liberalism') are clearly explained. -/- This book has been translated into Spanish, Portuguese, Italian, Vietnamese, Rumanian and Turkish. -/- Several scholars have done me the honor of posting a .pdf version of this work (which is no longer available in paper form). Here are three excellent versions that are easily found : -/- "Les fondements philosophiques du libéralisme jugurtha noblogs" (224 pages), "Les fondements philosophiques du libéralisme" (224 pages), in ZLibrary. -/- "Les fondements philosophiques du libéralisme abdelmagidzarrouki" (224 pages), -/- . (shrink)

Review of Mark Friedman's book 'Nozick’s Libertarian Project,' which is a defence of Robert Nozick's 'Anarchy, State, and Utopia.'.

This paper compares Joseph Heath’s critique of the just deserts rationale for markets with an earlier critique due to Frank Knight, Milton Friedman, and Friedrich Hayek. Heath shares their emphasis upon the role of luck in prices based on supply and demand. Yet he avoids their claim that the inheritance of human capital is on a moral par with the inheritance of ordinary capital, as a basis for unequal shares of the social product. Heath prefers to argue that (...) markets do not tend to reward talent as such. The paper raises some doubts about this factual claim, and argues that sweeping the issue of talent under the rug threatens to make our theory of justice less egalitarian than it would otherwise be. The paper also addresses the objection that claims of unfairness based on the arbitrariness of the distribution of innate abilities will undermine self-respect. (shrink)

Liberal-minded basic income scholars often argue that UBI has two key properties that work together to justify it. Let us call these the freedom justification and the narrative justification. On the one hand, UBI is defended because it gives people more freedom to do what they want to do. (Stigler, 1946, Friedman, 1962; Van Parijs, 1995; Widerquist, 2013) They exhibit primary concern for the purely formal properties of the regime of liberal neutrality. On the other hand, many scholars, including (...) many of the same liberal scholars, argue that UBI also pushes society substantively towards desirable social outcomes. They combine the freedom justification with substantive predictions and expectations. (Rifkin, 1995; Murray, 2016; Weeks, 2020) However, I show that both existentialist philosophy (Sartre) and complexity theory (Knight, Hayek, Schumpeter) suggest that a liberal social order is compatible, at best, with rough pattern prediction about a multiply realizable future that remains narratively open to multiple possible trajectories. Liberal neutrality, to the extent that it nourishes radical freedom, is incompatible with strong, stable narrative predictions. As Nozick put, it “liberty upsets patterns”. This is true of all liberal UBI models, and liberal institutions in general. (shrink)

Bunge (2000) distinguishes two main methodological approaches of holism and individualism, and associates with them policy prescriptions of centralism and laissez-faire. He identifies systemism as a superior approach to both the study and management of society. The present paper, seeking to correct and develop this line of thought, suggests a more complex relation between policy and methodology. There are two possible methodological underpinnings for laissez-faire: while writers such as Friedman and Lucas fit Bunge’s pattern, more sophisticated advocates of laissez-faire, (...) such as Smith and Hayek, base their policy prescription in a methodology quite divergent from the individualism Bunge describes. (shrink)

This review article of The Making of Modern Liberalism and Masters of the Universe: Hayek, Friedman, and the Birth of Neoliberal Politics centres on the different trajectories of liberal and neoliberal thought that are mapped out by these two works. It is argued that to achieve an understanding of the meeting points, continuities and discontinuities between liberalism and neoliberalism it is necessary to examine the economic and political bases of these forms of governmental reason. By doing so, it (...) is suggested that it is possible to develop a fuller understanding of what was/is new about neoliberalism as both a political and an epistemological project. (shrink)

Disagreements about the morality of markets, and about self-interested behavior within markets, run deep. They arise from perspectives within economics and political philosophy that appear to have nothing in common. In this book, Daniel Finn provides a framework for understanding these conflicting points of view. Recounting the arguments for and against markets and self-interest, he argues that every economy must address four fundamental problems: allocation, distribution, scale, and the quality of relations. In addition, every perspective on the morality of markets (...) addresses explicitly or implicitly the economic, political, and cultural contexts of markets, or what Finn terms 'the moral ecology of markets'. His book enables a dialogue among the various participants in the debate over justice in markets. In this process, Finn engages with major figures in political philosophy, including John Rawls, Robert Nozick, and Michael Walzer, as well as in economics, notably Milton Friedman, Friedrich Hayek, and James Buchannan. (shrink)

As a response to the COVID-19 crisis, governments have turned to various discretionary measures such as cash transfers to consumers and businesses with mixed results. Universal Basic Income (UBI) is back on the agenda as well. One of the main advantages of UBI, as scholars like F.A. Hayek, Milton Friedman, and James M. Buchanan have argued, is that it does not depend upon competent and benevolent government discretion—which is often in short supply—but upon pre-established rules. This paper argues (...) that the UBI scheme holds tentative promise from the point of view of improving the institutional crisis preparedness of a complex socioeconomic order. The pre-established rules of UBI buttress the rule of law framework that improves the ability of economic agents to spontaneously coordinate their actions in times of crisis characterized by radical uncertainty, disequilibrium shocks, and institutional instability. Furthermore, UBI combines the distribution of fungible resources with the delegation of independent decision-making power to millions of crisis-struck individuals and communities. Compared to discretionary tax-and-transfer schemes, the rules of UBI therefore appear more compatible with the polycentric discovery of novel solutions from the bottom-up. In times of crisis, UBI may be relied upon as one cornerstone of what I shall call the permanent crisis management framework. Having such a permanent scheme may minimize - although it does not altogether eliminate - the need for discretionary transfers, targeted intervention, and technocratic management in times of crisis. However, this theoretical model of UBI as a facilitator of polycentric crisis preparedness faces several practical challenges that need to be addressed in further research. (shrink)

Best known for reviving the tradition of classical liberalism, F. A. Hayek was also a prominent scholar of the philosopher John Stuart Mill. One of his greatest undertakings was a collection of Mill’s extensive correspondence with his longstanding friend and later companion and wife, Harriet Taylor-Mill. Hayek first published the Mill-Taylor correspondence in 1951, and his edition soon became required reading for any study of the nineteenth-century foundations of liberalism. This latest addition to the University of Chicago Press’s (...) Collected Works of F. A. Hayek series showcases the fascinating intersections between two of the most prominent thinkers from two successive centuries. Hayek situates Mill within the complex social and intellectual milieu of nineteenth-century Europe—as well as within twentieth-century debates on socialism and planning—and uncovers the influence of Taylor-Mill on Mill’s political economy. The volume features the Mill-Taylor correspondence and brings together for the first time Hayek’s related writings, which were widely credited with beginning a new era of Mill scholarship. (shrink)

This paper addresses the knowledge required for individuals to evaluate Information and Communications Technologies decisions that relate to the organization and management of cyberspace, and to hold accountable the parties responsible for those decisions, whether the responsible party is a government actor, market actor or private individual. The authors argue that the Open Systems Interconnection model, with certain modifications, should serve as a primary educational tool in helping individuals to gain the understanding of ICT necessary to protect public interests related (...) to cyberspace. (shrink)

From its inception with the first number of the magazine of opinion National Review and up to the advent of the Presidency of Richard Nixon the early American conservative movement struggled with the rising tide of civil rights protest and reform. This article examines the correspondence and published primary sources penned by leading members of the American conservative movement so as to offer a comprehensive, chronologically ordered assessment of the evolution of the views on racial inequality offered by the key (...) constituent ideological subcommunities within the American conservative movement: the traditionalists gathered around the pages of National Review, the “neoliberals” led by Milton Friedman y Friedrich von Hayek, the Southern, white conservatives and, lastly, the neoconservatives, which headed by Irving Kristol and Norman Podhoretz articulated much of such views in a manner palatable to a significant segment of the American political mainstream. (shrink)

Using almost disjoint coding we prove the consistency of the existence of a definable ω-mad family of infinite subsets of ω together with.

Immanuel Kant’s political philosophy has enjoyed renewed attention as an egalitarian alternative to contemporary inequality since it seems to uncompromisingly reassert the primacy of the state over the economy, enabling it to defend the modern welfare state against encroaching neoliberal markets. However, I argue that, when understood as a free-standing approach to politics, Kant’s doctrine of right shares essential features with the prevailing theories that legitimate really existing economic inequality. Like Friedrich Hayek and Milton Friedman, Kant understands the (...) state’s function as essentially coercive and, in justifying state coercion, he adopts a narrow conception of political freedom that formally preserves the right to choose while denying that the range of choices one actually has can be a matter of justice. As a result, Kant cannot identify various forms of social pressure as potential injustices even as he recognizes their power to create and sustain troubling inequalities. For both Kant and the neoliberals, the result is that economic relations almost never count as unjust forms of coercion, no matter how unequal they are. Views that identify coercion as the trigger for duties of justice are thus particularly ill-suited to orient us to contemporary inequality. (shrink)

The Market Economy: A Reader outlines the characteristics and philosophical underpinnings of the market economy and its usefulness in the allocation of resources. This anthology offers a comprehensive set of authentic, primary source selections that demonstrate how the tenets of classical economic liberalism provide the foundation for an efficient economic system--while also maximizing individual freedom. The readings also provide a structure for analyzing economic and philosophical issues. The book includes selections from several authors who are not economists but whose work (...) is important in terms of their contribution to economic thought, such as Henry David Throeau and Ayn Rand. It also features classic readings such as Adam Smith's invisible hand from his Wealth of Nations, David Ricardo's original explanation of comparative advantage from Principles of Political Economy and Taxation, and John Stuart Mill's eloquent expression of the limits of government in On Liberty. Latter day proponents of private enterprise include Friedrich Hayek, Ludwig von Mises, and Milton Friedman. These authors and others address how the market economy responds to such topical issues as the environment, income distribution, and free trade. (shrink)

We consider intuitionistic number theory with recursive infinitary rules . Any primitive recursive binary relation for which transfinite induction schema is provable is in fact well founded. Its ordinal is less than ε 0 if the transfinite induction schema is intuitionistically provable in elementary number theory. These results are provable intuitionistically. In fact, it suffices to consider transfinite induction with respect to one particular number-theoretic property.

The defence of the market and economic freedom have been the main objectives of the investigations by liberal thinkers such as Milton Friedman, Gary Becker, F Hayek and L Von Mises. Bearing in mind that the first two economists are the maximum exponents of the Chicago School and the last two of the Austrian School, it is often concluded that the theories of both schools are similar. This book demonstrates that in reality, there is no convergence or complementariness (...) to be found between both schools of thought. The anthropological categories, contributed by Mises, allow us to understand all human phenomena from the view of the man who acts. In this view, economics is part of a philosophical system whose core is the creative capacity of people. Becker’s work, on the other hand, is concentrated on the generalization of the _homo economicus_ as the basis for explaining all human behaviour. He generalizes the maximizing principle to explain all human reality, and extends the scope of the application of a so-called scientific and technical view of the world. In this key volume, an important read for those in the fields of economic theory and political economy, Javier Aranzadi argues, in essence, that the tradition of Hayek and Mises encourages a humanistic liberalism, whereas the Chicago School proposes only a technical humanism. (shrink)

Hayek's substantial contribution to theoretical psychology has been addressed in the work of Thomas Szasz, Gerald Edelman, and Joaquin Fuster.

This article presents a normative epistemological argument for unions, developed from libertarian premises. According to Friedman, the state should set up rules for the market, whereas managers should focus on profits. On this view, business ethics can be handled by regulations, but Hayek’s theory of the market indicates that this position is problematic, since it relies on the state being able to collect the relevant ethical information. Hayek argued that a market system is more efficient than planned (...) economies, since it handles information more efficiently. However, there is also reason to doubt that markets can provide the needed information. The price mechanism carries information solely about preferences, but ethics also concerns rights, voluntariness and needs. Moreover, Coase showed that inside firms there are no Hayekian price mechanisms. Firms are characterized by hierarchy, which means that both employers and employees may have incentives to not be forthcoming with information relevant information. The moral epistemology of Anderson, with an important role for civil society, is used to identify solutions to these informational problems. As a part of civil society, unions complement the market as a source of ethical information, and inside the firm they balance power and provide an avenue for voice. (shrink)

Liberalism generally holds that legitimate political power is limited and is to be impartially exercised, only for the public good. Liberals accordingly assign political priority to maintaining certain basic liberties and equality of opportunities; they advocate an essential role for markets in economic activity, and they recognize government's crucial role in correcting market breakdowns and providing public goods. Classical liberalism and what I call “the high liberal tradition” are two main branches of liberalism. Classical liberalism evolved from the works of (...) Adam Smith and the classical utilitarian economists; its major 20th century representatives include Friedrich Hayek and Milton Friedman. The high liberal tradition developed from John Stuart Mill's works, and its major philosophical representatives in the 20th century are John Dewey and, later, John Rawls. This paper discusses the main distinguishing features of the classical and the high liberal traditions and their respective positions regarding capitalism as an economic and social system. Classical liberals, unlike high liberals, regard economic liberties and rights of private property in productive resources to be nearly as important as basic liberties. They conceive of equality of opportunity in more formal terms, and regard capitalist markets and the price system as essential not only to the allocation of production resources, but also as the fundamental criterion for the just distribution of income, wealth, and economic powers. High liberals, by contrast, regard the economic liberties as subordinate to the exercise of personal and civic liberties. They are prepared to regulate and restrict economic liberties to achieve greater equality of opportunities, reduce inequalities of economic powers, and promote a broader conception of the public good. And while high liberals endorse markets and the price system as essential to allocation of productive resources, they do not regard markets as the fundamental criterion for assessing just distributions of income, wealth, and economic powers and positions of responsibility. The paper concludes with some reflections upon the essential role that dissimilar conceptions of persons and society play in grounding the different positions on economic justice that classical and high liberals advocate. (shrink)

First published in 1982. Routledge is an imprint of Taylor & Francis, an informa company.

1. The Real Claim of the Chicago School If anything dramatic has happened in economic theory over the last one hundred years – namely, since the advent of marginalism – then, everyone agrees, it was not the rise of the Chicago neo -classical school which, after all, only synthesized the various versions of marginalism, but the Keynesian Revolution. Assessments of this revolution were repeatedly invited, particularly by opponent, chiefly from Chicago. F. A. von Hayek has explicitly and bitterly blames (...) Keynes for all our economic troubles; Harry Johnson has repeatedly declared the most revolutionary work of Keynes, his General Theory of 1936, so poor that but for its author's name on its title page it would have totally flopped. Can such a flop cause so much damage? Are these two assessments – of Hayek and of Johnson – in conflict or no t? Don Patinkin has raised a different question: how different is Keynes from his Chicago opponents, say, Milton Friedman? How many heads need roll, to use his metaphor, before a revolution may be declared? Patinkin sees Keynes as slightly deviant but stil l a member of the mainstream – the mainstream of the mainstream being Friedman and his Chicago followers, of course. Now, can a minor deviant be a flop? Can minor deviations from the true blue doctrine be to blame for all of our economic woes? I do not kno w. Joan Robinson sees in Keynes a minor deviation from classical theory because he said once his correction of classical theory is implemented, that theory takes over once again. Moreover, Samuelson and Friedman have endorsed a (poor) version of Keynes' theory of shortterm relative price and ignored his general theory of price and money. (shrink)

The aim of this thesis is to discuss the nature of social phenomena, and to determine the appropriate way to explain them. Many of the contentions advanced rest largely upon the fact that social phenomena can be investigated only by methods which respect their distinctive character and status as social phenomena. In chapter I it is argued that the most important difference between the social and the natural sciences is that the former have to employ intentional criteria to identify their (...) explananda-phenomena. Because human and societal phenomena are intrinsically meaningful, the type of causation which prevails in the social realm is fundamentally different from that which prevails in the physical. In chapter II the claim of Popper and Hayek that the task of the social sciences is to trace the unintended consequences of human actions is critically examined. Two examples of economic explanation are given in order to show the importance of unintended consequences, and to illustrate the general form explanations of social phenomena should adopt. In chapter III the contention that the social sciences deal with inherently complex phenomena is examined and defended, and the main implications of this contention for social analysis are drawn. The extent to which social phenomena are in principle predictable is discussed. In chapter IV the structural properties of formal scientific theories are briefly characterised, and then Friedman's famous argument on the testability of economic theories is analysed and rejected. The role within a scientific theory of statements formulated with reference to idealisations of the phenomena being studied, and the role within a social explanation of the 'principle of rationality', are discussed. In chapter V the central questions behind the methodological individualism/methodological holism controversy are brought to light. Provided that methodological individualism is not construed as a reductionist or mechanistic principle, it can successfully avoid the main objections of its detractors. It is argued that the method of functional analysis in sociology is consistent with methodological individualism. Finally, it is claimed that the principle of methodological individualism does indeed recommend the appropriate way to explain societal phenomena. In chapter VI, the various strands of thought running through the five preceding chapters are drawn together in a brief summary of the most important points raised by this thesis. (shrink)