Hayek's The Constitution of Liberty - Institute of Economic Affairs

h ay e k ’ s t h e c o n s t i t u t i o n o f l i b e r t y
t h e u s e a n d l i m i t s o f k n o w l e d g e
can promote social order by establishing the conditions for it, but
cannot do so by trying to arrange individuals in an orderly way.
Thus the lawmaker’s task ‘is not to set up a particular order but
merely to create conditions in which an orderly arrangement can
establish and ever renew itself ’ (161).
Hayek draws support here from Michael Polanyi, who speaks
of ‘the spontaneous formation of a “polycentric order.”’ Polanyi
explains that such order ‘is achieved among human beings by
allowing them to interact with each other on their own initiative
– subject only to the laws which uniformly apply to all of them.’
Their individual efforts are coordinated ‘by exercising their individual
initiative;’ and ‘this self-coordination justifies this liberty
on public grounds’ (160).
As for deliberate organisation, Hayek acknowledges that a free
society ‘produces institutions in which, for those who prefer it, a
man’s advancement depends on the judgment of some superior
or of the majority of his fellows.’ Business firms and government
agencies would be leading examples of such institutions. Here
individuals are subject to the orders of their superiors, and their
place in the organisation depends on someone else’s judgement of
their contribution or their merit (99).
Hayek emphasises that his argument for liberty ‘is not an
argument against organization, which is one of the most powerful
means that human reason can employ.’ What he principally
objects to are, first, monopolistic organisations that are exclusive,
privileged and coercive, and second, any attempt to impose on
society at large the organisational pattern, with individuals being
assigned to positions according to a single comprehensive scale of
merit. He faults the French rationalist tradition in particular for
seeking ‘the highest degree of political civilization in organization,
that is, in the highest degree of interference by public power’ (55).
So long as the growth of organisations ‘does not produce a situation
in which a single comprehensive scale of merit is imposed
upon the whole society, so long as a multiplicity of organizations
compete with one another in offering different prospects, this
is not merely compatible with freedom but extends the range of
choice open to the individual’ (99).
The wide availability of useful knowledge, as transmitted
through rules and communicated though signs, attests to an order
that, while not intelligible itself, is the source of intelligibility in our
daily lives. This order, speaking broadly, is what Hayek means by
‘civilisation,’ understood as the direction of man’s social evolution
since the advent of cities, about eight thousand years ago. Civilisation
is an artificial order, generated spontaneously by countless individual
actions but not designed or instituted by anyone. It requires
adaptations to material conditions that nature imposes, but is not a
product of natural growth. Organisations play an indispensable role
within this undesigned order, but can never hope to replace it.
Reason, mind and civilisation
Hayek seeks to defend reason, properly understood, against
rationalism: ‘Reason undoubtedly is man’s most precious possession,’
but it has been abused by persons who greatly exaggerate
its powers (69). In The Constitution of Liberty, Hayek uses the term
‘anti-rationalist’ to identify his preferred position (see 57, 61, 63,
69, 437), but as he came to recognise, this usage obscures his true
intention. After all, Britain’s so-called anti-rationalists were not
opposed to reason, but wanted to make reason more effective by
establishing its proper limits. Thus in later writings he drops this
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