"Readers' Forum, Comments on 'The Tradition of Spontaneous Order' by Norman Barry"
By James M. Buchanan and David Gordon and Israel Kirzner
Norman Barry states, at one point in his essay, that the patterns of spontaneous order “appear to be a product of some omniscient designing mind” (p. 8). Almost everyone who has tried to explain the central principle of elementary economics has, at one time or another, made some similar statement. In making such statements, however, even the proponents-advocates of spontaneous order may have, inadvertently, “given the game away,” and, at the same time, made their didactic task more difficult…. [From the text, James M. Buchanan, “Order Defined in the Process of its Emergence”]
First Pub. Date
Literature of Liberty. vol. v, no. 4, pp. 5-18. Arlington, VA: Institute for Humane Studies
Collected commentary, various authors. Collected commentary, various authors.
The text of this edition is copyright ©1982, The Institute for Humane Studies. Republished with permission of original copyright holders.
7. David Gordon, “Comments on ‘The Tradition of Spontaneous Order’ ”
Norman Barry’s article “The Tradition of Spontaneous Order” (Literature of Liberty, Summer, 1982) seems to me a most perceptive analysis: it is easily the best survey of its topic which has appeared.
There are, however, one or two points at which I should be inclined to portray matters differently from Barry. Before presenting these, however, I should emphasize that these do not detract from my admiration of Barry’s essay.
First, if a spontaneous order is defined as one that is not planned by a single mind but, rather one that emerges from the coordinated actions of the actors in a social system, it is not evident why only individuals can form such an order. Suppose, contrary to methodological individualism, that there are emergent laws for societies composed of more than a few individuals, which cannot in principle be reduced to the actions (planned or unplanned) of the individuals who compose that society. Why would the existence of such laws preclude the existence of spontaneous orders derived from individual actions in just the manner Barry sets out? I am not sure whether my last remark involves any difference of opinion with Barry. He says, “It is a major contention of the theory of spontaneous order that the aggregate structure it investigates are the outcomes of the actions of individuals,” (pp. 8-9). This does not claim that the spontaneous order tradition rejects all social laws not conforming to the requirements of methodological individualism: it is only that spontaneous orders must be reducible to individuals’ actions. Without criticizing methodological individualism, I would question whether the truth of spontaneous order theories rests on the truth of that methodology.
Another point, raised by Barry’s excellent discussion of Carl Menger, is whether the results which have arisen from a spontaneous order can also come about as the result of consciously planned action. Menger, whose explanation of the origin of money is a paradigm case of spontaneous order held, according to Barry, that money need not arise by the spontaneous process he described: “Against the rationalist explanation [that money arose by specific agreement] Menger argues that, although money can and has come about in this way, the institution can be accounted for by natural processes.” (p. 32) There is an interesting contrast here with Ludwig von Mises who in The Theory of Money and Credit and Human Action maintains that money must arise by a spontaneous process. Also, Hayek wants to say not only that production can be coordinated spontaneously by the market but that a centrally directed economy is incapable of such coordination.
The question then arises, does one want to make it a requirement of a spontaneous order theory that the order which has arisen spontaneously could not have done so otherwise? If one does, in what sense of “could not”? Must it be logically impossible? And, if one does not impose such a requirement, must one at least hold that a particular result is much more likely to have emerged spontaneously than otherwise?
Raising this question involves no dissent from Barry’s analysis. But at one point he does seem to me to be in error. He distinguishes two sorts of explanations of social structure that involve no reference to conscious design. “One version shows how institutions and practices can emerge in a causal-genetic manner while the other shows how they in fact survive.” (p. 11) As an example of what he has in mind, Barry contrasts a market system, governed by the price mechanism, with the evolution of a legal system, in which “it is not obviously the case that there is an equivalent mechanism to produce that legal and political order which is required for the co-ordination of individual order.” (p. 11)
I fail to see why Barry thinks that evolutionary model doesn’t provide a mechanism for the emergence of spontaneous order. In the example of the evolution of legal systems, the argument is that societies with legal systems which succeed in coordinating individual actions will, other things being equal, have a greater chance at survival than societies without such systems. Granted that some societies have better coordinated legal systems than others at the start; differential survival explains why the systems present in these societies will spread.
The mechanism here seems quite analogous to the price system, in which firms which fail to produce what the consumers demand (or at least do so to a lesser extent than others) tend to fall by the wayside. The emergence of a market order where one does not exist, is also a process that takes time.
Perhaps Barry’s argument, though, is that for the case of the legal system, one hasn’t been given explanation of the way in which the legal system that eventually triumphs has arisen. (Just as in biological evolution the mechanism of natural selection doesn’t explain the emergence of genetic variance.) This is perfectly true, but, once more, how is this case different for the price system? The process of market coordination does not explain the original pricing and output decisions of the firms in an economy. It explains, rather, why firms which have made the “right” decisions supplant those which have not.
Barry is of course right that the legal system that emerges through “survival of the fittest” may not be conducive to classical liberalism (or at least one needs some argument to show that there must be such a correspondence. One possibility is that since market economies tend to survive better than non-market societies, which cannot coordinate the knowledge in society, a legal system conducive to market order will have a significant evolutionary advantage.) But this does not show that there isn’t a mechanism for the emergence of a legal order (I’m not clear whether Barry intends to deny this in his discussion on pp. 11-12).
Finally, Barry successfully avoids a frequent error about the relation of spontaneous orders to ethics. He says, “There is, of course, implicit in all the writers in this tradition the notion of an ethical payoff: that is, we are likely to enjoy beneficial consequences by cultivating spontaneous mechanisms and by treating the claims of an unaided reason with some skepticism.” (p. 11) The argument, in other words, is that spontaneous orders lead to better results: it isn’t that a spontaneous order is, as such, ethically superior to planned order.
This may seem obvious, yet I have heard it argued that if the minimal state of Robert Nozick’s Anarchy, State, and Utopia arose through a non-spontaneous process (e.g., people agreeing to cut down an existing state) its moral validity would be placed in question. It isn’t at any rate obvious why a conscious agreement is morally inferior to a spontaneous order. It might be said that with a spontaneous order, at least one knows that the actions of the constituent individuals haven’t been coerced. But this is wrong: why can’t coerced actions be the subject of invisible-hand explanations? And agreements, on the other side, can be entirely voluntary. Barry evidently disagrees with the first part of this, as he apparently (p. 11) makes it a requirement of a spontaneous order that it operate on uncoerced actions. But he gives no reason for this.
In conclusion, Professor Barry is to be congratulated for his outstanding article. To readers of his previous works, the excellence of the present essay will come as no surprise.
Notes by Roland Vaubel
Notes by Jeremy Shearmur