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DEFERRING TO COMPLEXITY

Our discussion thus far has captured the core elements of Hayek’s own views on environmental political economy. However, Gus DiZerega (1992; 1996a; 1996b), Andrew Gamble (2006, 129-30), and John O’Neill (2012) have emphasized a further theme in Hayek’s work that also bears on environmental issues. According to these commentators, the ideas motivating Hayek’s allegiance to economic markets also apply to natural ecosystems, with DiZerega in particular drawing the inference that consistent Hayekians should be principled environmentalists as well. Although Hayek never developed such a position himself, exploring this point will help to round out our investigation of how Hayekian political economy can be applied in environmental debates.

The Significance of Complex Systems

Let us begin by recalling why Hayek advocates reliance on markets to coordinate economic affairs. As we saw above, economic prosperity relies on effectively using a massive amount of information, and yet this information is irretrievably dispersed. The only way for societies to become sensitive to all of this information is to decentralize decision making to individuals embedded in a market economy. Market activities give rise to prices, and the price system guides individuals to act with sensitivity to others’ circumstances. Markets thereby cause favorable patterns of economic activity to “emerge” even when such outcomes could never have been produced by a central designer.

In Hayek’s view, our reliance on markets is illustrative of a broader issue. Many worldly phenomena are too complex to be produced through deliberate construction, but they can emerge “spontaneously” when conditions are right. Perhaps the most straightforward examples come from chemistry:

We can never produce a crystal or a complex organic compound by placing the individual atoms in such a position that they will form the lattice of a crystal or the system based on benzol rings which make up an organic compound. But we can create the conditions in which they will arrange themselves in such a manner. (Hayek 1973, 39-40)

Hayek sees market economies as similar in that they could never be arranged through conscious planning. If they are to exist at all, they must be permitted to “grow” on their own (36-38). Hayek finds other analogous cases throughout society, rejecting as fundamentally misguided the view that “Morals, religion and law, language and writing, money and the market were . . . deliberately constructed by someone” (10). He prefers instead to explain these phenomena by appeal to unguided processes of social evolution (17-19).

Hayek claims that our reliance on self-organizing complex systems both extends and limits our abilities to realize our goals. These systems empower us by facilitating outcomes we could never produce through deliberate planning. But they also limit us in that we typically cannot control them in their finer details (41-42). Indeed, Hayek writes, “There will be many aspects . . . over which we will possess no control at all, or which at least we shall not be able to alter without interfering with—and to that extent impeding—the forces producing the spontaneous order” (42).

Hayek’s concerns about interfering with complex systems are well illustrated by the policy positions discussed in the previous sections. But they become most emphatic when he lays out the case for maintaining broad latitude for individual liberty in society. Since liberty is essential to the functioning of market processes, Hayek argues that its preservation is critical if societies are to continue to prosper. Yet he recognizes that the consequences of undermining liberty will often be unclear in individual cases, since our understandings of social and economic systems are insufficient to enable accurate, detailed predictions. Hence he writes:

[W]hen we decide each issue solely on what appear to be its individual merits, we always over-estimate the advantages of central direction. Our choice will regularly appear to be one between a certain known and tangible gain and the mere probability of the prevention of some unknown beneficial action by unknown persons. If the choice between freedom and coercion is thus treated as a matter of expediency, freedom is bound to be sacrificed in almost every instance. (57)

It is for this reason that Hayek contends that “A successful defence of freedom must . . . be dogmatic and make no concessions to expediency, even where it is not possible to show that, besides the known beneficial effects, some particular harmful result would also follow from its infringement” (61). Maintaining social and economic functionality requires a principled devotion to liberty, not because we will always be able to understand the specific benefits of acting on such principles, but because robust individual liberty is necessary for the operations of the complex systems on which we rely.

 
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