AMA-gi

Volume 1

Number 1

Michaelmas Term 1996

Essay 8

Hayek's Constitutional Political Economy

By

Viktor Vanberg

Updated:31/01/98

Essay 9

Essay 7

Index

 

 

 

 

Hayek's Constitutional Political Economy

 

Viktor Vanberg Explores Hayek's Ideas on the Relationship Between Rules, Order and Complex Social Systems

 

 

 

Two Kinds of Order and Two Kinds of Rules

Hayek has commented in detail on some of the more specific characteristics of different kinds of social rules. The most fundamental and significant distinction which he draws in this regard parallels his familiar distinction between two kinds of social order (Hayek 1973: 35.). In his first approximation Hayek distinguishes between spontaneous order and organisation by characterising the former as rule-governed and the latter as command-governed: while in a spontaneous order individuals are 'bound only by general rules of just conduct' in an organisation they are 'subject to specific directions by authority' (1976: 85). Hayek adds, however, that this definition needs to be qualified, not only because, as rules become more specific and commands more general, it may be difficult to distinguish between the two, but also, and more importantly, because to 'some extent every organisation must rely also on rules and not only on specific commands' (1973: 48). This is so essentially for the same 'use-of knowledge' reason that applies to spontaneous orders. Only by relying on general rules rather than specific commands can knowledge be used that exists dispersed among the several members of an organisation, knowledge that cannot feasibly be collected and processed by a central authority (Hayek 1964: 9).

However, while acknowledging that not only spontaneous orders but organisations as well rely on rules, Hayek emphasises that there are 'important differences between the kinds of rules which the two different kinds of order require' (1973: 48). Indeed, he argues that the difference between the two kinds of order is systematically related to the difference between the kinds of rules on which they rest. That is, he suggests that the conceptual distinction between spontaneous order and organisation is in part a matter of specifying 'in what respect the rules required for the purposes of organisation differ' from the 'rules of just conduct' (ibid.: 122).

Hayek's treatment of this issue is not entirely free from ambiguity because he does not always clearly separate the question of how these two kinds of rules differ in their nature from the question of how they originate (whether they 'spontaneously evolve' or are 'deliberately designed'). Even though it is plausible to assume that some de facto correlation exists between the two aspects, they relate to two conceptually different dimensions, and - as Hayek indeed acknowledges - the difference in nature between the two kinds of rules should therefore be defined independently of their mode of origin.

In a section entitled 'The rules of spontaneous orders and the rules of organisations' Hayek (ibid.: 48.) explains the differences that in his view separate the two types of rules as follows:

What distinguishes the rules which will govern action within an organisation is that they must be rules for the performance of assigned tasks. They presuppose that the place of each individual in a fixed structure is determined by command and that the rules each individual must obey depend on the place which he has been assigned and on the particular ends which have been indicated for him by the commanding authority . . . Rules of organisation are thus necessarily subsidiary to commands, filling in the gaps left by the commands. Such rules will be different for the different members of the organisation according to the different roles which have been assigned to them, and they will have to be interpreted in the light of the purposes determined by the commands (Hayek 1973: 49).

By contrast, Hayek argues, the rules of just conduct on which spontaneous orders rely have a number of characteristics that make them 'logically distinct' (ibid.: 125) from rules of organisation (1976: 31., 126.). They are universal in the sense of being 'the same, if not necessarily for all members, at least for whole classes of members not individually designated by name. They must . . . be rules applicable to an unknown and indeterminable number of persons and instances' (1973: 50). They are 'negative in the sense that they prohibit rather than enjoin particular kinds of actions' (1976: 36). They 'only limit the range of permitted action' (1973:127;1976:124) and 'protect ascertainable domains within which each individual is free to act as he chooses' (1976: 36), thus making 'the peaceful coexistence of individuals in society possible' (1973: 72).

When one contrasts, in the manner indicated, rules of just conduct and rules of organisation, it is important to keep in mind that organisations are 'subject' to rules in two different regards. There are, first, the rules which co-ordinate the activities of the several members of an organisation and, thus, constitute the organisation as an operating unit. These rules concern the internal operation of the organisation, they govern the behaviour of, and interrelations among, individuals in their capacity as members of the organisation. In addition, organisations are subject to 'rules of conduct' which apply to their 'external behaviour' as operating units or legal entities, in essentially the same sense in which individuals (natural persons) are subject to rules of conduct in their behaviour toward others. Only the first category of rules falls under the rubric of rules of organisation in the sense specified above. The second category, by contrast, systematically belongs into the same rubric as the general rules of conduct, they are, in Hayek's terms, 'rules regulating the conduct of persons toward others, . . . delimiting the boundary of the protected domain of each person (or organised group of persons)' (1973:122).

Indeed, organisations as 'legal persons' and individuals as 'natural persons' can be, and typically are, to some extent subject to the same set of 'rules of conduct', and it is, as Hayek emphasises, one of the important issues for constitutional policy' to determine whether and in what regards it may be necessary or advisable that organisations as 'legal persons' be subject to 'rules of conduct' different from those that apply to 'ordinary', natural persons. Hayek is explicitly critical of a view that he sees behind certain arguments in the debate on the legal status of corporations, namely 'the conception that, if legal personality was conferred upon the corporation, it was natural to confer it upon it all powers which natural persons possessed' (1967: 309). He considers this 'by no means a natural or obvious consequence' (ibid.). In his view the power that can be concentrated in organisations or corporate entities, as well as certain rights that existing law concedes to such 'legal persons' - in particular the privilege of limited liability (ibid.: 306) - may require that organisations be subject to 'limitations by general rules of law far more narrow than those it has been found necessary to impose by law on the actions of private individuals' (1979: 90).

 

The Rules of Government

 

The distinction between the rules of (internal) organisation in the defined sense and the rules of the (external) 'conduct' of organisations, deserves special attention where the particular organisation is concerned that we call 'state' or government'. The fact that the state is the organisation which is charged with the task of securing the framework of general rules of conduct upon which the spontaneous order of society is based, and at the same time is itself, as an organisation, subject to rules, tends, as Hayek supposes, to cause confusion concerning the nature of the different kinds of rules that are involved. Several issues ought to be carefully separated in this regard.

There is, first, the separation between 'state' (or 'government') and 'society'. The social order which we call society is, as Hayek argues, a spontaneous order (1976: 103), it is 'the spontaneously grown network of relationships between the individuals and the various organisations they create' (1979: 140). By contrast, the state is 'the organisation of the people of a territory under a single government' (ibid.), an organisation which, in order to carry out its functions requires an organised apparatus, called government. The spontaneous order 'society' not only contains, as Hayek explains, many organisations, it also requires 'an organisation 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' (1964:10). This organisation, the state, typically also renders other services to its members, the citizens, such that 'two distinct tasks' (1973:131) or 'two distinct functions of government' (ibid.: 48) need to be distinguished which Hayek classifies as 'coercive functions' and 'service functions', a classification that parallels J. M. Buchanan's (1975: 68.) distinction between 'protective state' and 'productive state'.

It is, Hayek emphasises, 'most important that we keep clearly apart these altogether different tasks' because the rationale behind the special authority which government must be granted in its coercive function does not extend to its service functions (1979: 42). In particular, while in its first role, as 'protective agent', government necessarily commands a monopoly role as referee-enforcer of the 'rules of the game', in its second role, as 'productive agent', it acts as a player among others within the game and does not need to be granted a monopoly position in order to fulfil its service functions. While all citizens are necessarily subject to the rules which government enforces in its 'protective' role, individuals are not as such subject to the authority of government in its 'productive' role. The authority that government can claim in this regard is strictly confined to its control of the limited amount of 'personal and material resources entrusted to it for rendering services' (1973:131). It is therefore, as Hayek points out, entirely misleading to speak - as is sometimes done - 'of a government 'running a country' as if the whole society were an organisation managed by it (ibid.), a formulation that would be descriptive only of a perfectly totalitarian society in which government would claim control over virtually all resources, in which case the distinction between 'state' and 'society' would become meaningless. In all other cases the distinction between the spontaneous order of 'society' and the organisation 'state' can be specified in terms of the distinction between the 'share of the resources of society' (1979: 16) that is subject to governmental control and those resources which individuals, separately or organised in private organisations, are free to use within the confines of the general rules of conduct enforced by the 'protective state'.

Hayek's general argument on the differences between the 'two kinds of order' implies that the rules on which the organisations state and government are based 'necessarily possess a character different from that of the universal rules of just conduct which form the basis of the spontaneous order of society at large' (1973:125). As Hayek states, the latter category of rules essentially coincides with private law (including criminal law) while the rules of the organisation of government correspond to what is called public law. The public law which determines the organisation of government (1976: 31) defines the terms of membership in the organisation 'state', that is, it specifies the rights and obligations of individuals as citizens, and it regulates 'the powers of the agents of government over the material and personal resources entrusted to them' (1973: 125). Into the 'public law' category fall, in particular, those rules which in the conventional, more narrow sense of the term can be called constitutional (1979:100), that is, the 'rules of the allocation and limitation of the powers of government' (1973:134), rules that are 'chiefly concerned with the organisation of government and the allocation of the different powers to the various parts of this organisation' (1979: 37). Though, in a general sense, the rules 'comprised in the constitution' can all be classified as organisational rules, it is more accurate to distinguish, as indicated above, between two kinds of constitutional rules, namely, on the one side, those that are concerned with the (internal) organisation of the 'state' and its apparatus 'government', and, on the other side, those that limit the authority of government, rules that constrain the actions of this organisation. Stated differently, one ought to distinguish between the rules of organisations in the strict sense, i.e., those parts of the constitution (or of public law) which constitute the multi-person units 'state' and 'government' as decision-making and acting organisations, and the rules which impose constraints on the range and kinds of decisions and actions that the state and its governmental apparatus are authorised to engage in. The organisational rules of government in essence determine how or in what manner the resources that are subject to governmental authority are to be administered. They determine, for instance, the procedures by which decisions on various matters are to be made, how representatives and public officials are elected or appointed, they 'establish a hierarchy of command' and determine 'the responsibility and the range of discretion of the different agents' (1973:125) etc. These are rules that apply to individuals in their capacities as either members, i.e., citizens, or agents of the organisation 'state'. In a more inclusive interpretation, they can be said also to include rules regulating the 'private use of public resources', like the rules concerning the use of public parks or, more significantly, the 'rules of the road'.

The limiting rules of government, by contrast, are concerned with what the state may do as an organisation, rather than with how it can operate as an organisation. They define the limits of governmental authority. They define and confine the share of the resources of society that is to be controlled by the state, and they constrain the range and kind of decisions and actions that the state, through the apparatus of government, may carry out. The most obvious rationale for such limiting rules lies, of course, in the principal-agent or Leviathan problem, that is, in the issue of how those who actually exercise the powers of government can be effectively prevented from misusing these powers. This problem has been the principal concern of the advocates of the idea of constitutional government. There is, however, a further - and less well recognised - rationale for limiting rules to which Hayek draws attention. The same reasons, that - as discussed above - make it advisable for a single individual to submit to rules can, Hayek argues, also be applied to the realm of collective action in general and to the organisations state and government in particular. In the same sense in which rules are necessary to give coherence to the several successive decisions and actions of an individual person, rules are also needed - and even more so - to guide decisions that are made by a group of individuals, in order to prevent the successive decisions from producing incoherent and undesirable overall outcomes. 'Even more so', because the 'natural unity' and intertemporal identity which characterises the individual person as decision-maker is absent in the case of collective decisions, in particular in the case of majority decisions (Hayek 1960: 110,111;1979: 7, 18,19).

As Hayek points out, the distinction between organisational and limiting rules of government can be related to the distinction between two ideals of government, namely, liberalism and democracy, which, despite their historical interconnections, ought to be analytically separated as concerned with different issues. The ideal of democracy is principally concerned with the organisational rules of government, while the ideal of liberalism is principally concerned with the limiting rules of government. The former is concerned with the issue of who controls the apparatus of government, the latter is concerned with the issue of how the power of government can be effectively limited and constrained - separately and independently of the first issue. The failure to clearly recognise that these are two separate issues is, Hayek supposes, at the roots of the institutional deficiencies that he diagnoses in the prevailing form of modern democratic government. The 'endeavour to contain the powers of government' which was the great aim of the constitutionalist movement in the seventeenth and eighteenth centuries was, as Hayek (1979: 128) suggests, 'almost inadvertently abandoned when it came to be mistakenly believed that democratic control of the exercise of power provided a sufficient safeguard against its excessive growth'. Because of this 'tragic illusion' the primary attention in the formation of modern democratic regimes has been focused, in terms of the above distinction, on the organisational rules of government, neglecting the rules that are designed to limit the powers of government, a fact that, as Hayek argues, has allowed these regimes to develop characteristics and to generate overall results with which hardly anybody can be satisfied. What, in Hayek's judgement, is therefore most needed in order to correct the institutional deficiencies of modern democracy is the revival of the constitutionalist ideal 'that the power of all authorities exercising governmental functions ought to be limited by long run rules which nobody has the power to alter or abrogate in the service of particular ends' (1979: l29).

 

the order of rules and the order of actions

The interplay between the rules of individual conduct and the social order of actions is a theme equally central to Hayek's system of thought as the previously discussed role-of-rules theme. Hayek takes much care to point out that we have to clearly distinguish between two different aspects or levels of what we refer to as 'social order', namely 'the systems of rules of conduct which govern the behaviour of the individual members of a group . . . on the one hand and, on the other hand, the order or pattern of actions which results from this for the group as a whole' (1967: 66). Careful recognition of the distinctiveness of the order of rules and the order of actions (1973: 98) is, according to Hayek, an essential prerequisite for our understanding of how rules contribute to the formation of social order and how differences and changes in the underlying rules will affect the order or pattern of actions.

In his discussion of the 'connection between the rules men obey and the order which is formed as a result' (1967:112) Hayek primarily concerns himself with spontaneous orders, with orders that are entirely based on general rules of conduct. It should be obvious, however, that the issue of how different rules affect the resulting order of actions is of relevance for orders of the organisation-type as well, that is, for orders which are based on a combination of rules and commands. In fact, Hayek's arguments on the relationship between the 'two kinds of order' and the 'two kinds of rules' and, in particular, his arguments on the defects of modern democratic institutions, exemplify how such analysis can be generalised across different types of social arrangements.

The ways in which rules contribute to the formation of a spontaneous social order and in which the character of the rules affects the character of the resulting order of actions can be illuminated, as Hayek suggests, by drawing an analogy with ordinary games. The rules, he argues, that lead...

to the formation of the spontaneous order have much in common with rules observed in playing a game . . . A game is indeed a clear instance of a process wherein obedience to common rules by elements pursuing different and even conflicting purposes results in overall order. (Hayek 1988:154)

It is in reference to this analogy between the nature of games and the nature of spontaneous orders that Hayek describes the order of the market as the game of catallaxy, the game of exchange.

For ordinary games we cannot only clearly distinguish between the rules of the game and the pattern of actions resulting under these rules, we can also systematically analyse the differences and changes in the order of actions that will result under different sets of rules or from changes in rules, and furthermore, we can systematically compare alternative systems of rules as to the desirability, for the persons involved, of the order of actions that different rules will tend to generate. Essentially the same analytical perspective can be applied, not only to the 'economic game' of the market as well as other kinds of spontaneous orders, but also to social arrangements that fall into the category of organisations, private and public.

In ordinary games as well as in the various arrangements of social co-operation, Hayek argues, the nature of the 'rules of the game' - in conjunction with the circumstances that prevail in the respective environment - will determine whether an order of action will emerge and of what character this order will be (1967: 71). That in his sense 'appropriate rules' are a prerequisite for the beneficial operation of the spontaneous order of the market has been clearly recognised, as Hayek points out, by the eighteenth-century founders of classical liberalism. The problem that they raised is, in Hayek's account, still the central issue for social theory and for social policy, namely the question of 'what kind of rules of conduct will produce an order of society and what kind of order particular rules will produce' (1973: 44).

 

In discussing the issue of how we can know or find out what good or appropriate rules are, Hayek applies an argument that parallels his reasoning on the role of rules (see the first section). Our 'irremediable ignorance' which renders our reason insufficient 'to master the full detail of complex reality' not only creates a need for relying on rules, it also makes it necessary for us, Hayek argues, largely to rely on unquestioned traditional rules instead of attempting to choose rationally or construct the system of rules that we want to follow. This argument has, Hayek reminds us, already been stated by David Hume who reasoned

that human intelligence is quite insufficient to comprehend all the details of the complex human society, and [. . .] it is this inadequacy of our reason . . . which forces us to be content with abstract rules; and further that no single human intelligence is capable of inventing the most appropriate abstract rules because those rules which have evolved in the process of growth of society embody the experience of many more trials and errors than any individual mind could acquire. (Hayek 1967: 88)

There are, in other words, two dimensions to the 'knowledge problem' as thematised by Hayek: there is, first, the cross-sectional problem of using the fractional knowledge that is dispersed among the several individuals living as contemporaries; and there is, second, the intertemporal problem of profiting from experiences that previously-living generations have made. With regard to the intertemporal dimension of the use-of-knowledge problem, Hayek has advanced a theory of cultural evolution. It is sufficient to note that this theory is not meant to deny the potential usefulness of critical rational analysis and deliberate reform of rules. Hayek explicitly states that the evolutionist -argument does not diminish our particular interest in 'those rules which, because we can deliberately alter them, become the chief instrument whereby we can affect the resulting order, namely the rules of law' (1973: 45), and he deplores the fact that the important question of which 'rules of individual action can be deliberately and profitably altered, and which are likely to evolve gradually with or without such deliberate collective decisions as legislation involves, is rarely systematically considered' (1967: 72).

 

The Role of Constitutional Politics

Rather than denying that there is a role for rational analysis and deliberate the reform of the framework of rules within which we find ourselves, Hayek's emphasis on cultural evolution is intended to remind us of two things that rationalist zeal tends to disregard: we should approach inherited traditional rules with modesty and caution because they may well incorporate experience, and perform beneficial functions, of which we are not aware. And, second, we should keep in mind that an improvement of the framework of rules can be realistically expected not from rationally redesigning the entire structure, but rather from experimental, piecemeal change. As Hayek puts it:

Since any established system of rules of conduct will be based on experiences which we only partly know, . . . we cannot hope to improve it by structuring anew the whole of it. If we are to make full use of all the experience which has been transmitted only in the form of traditional rules, all criticism and efforts at improvement of particular rules must proceed within a framework of given values which for the purpose in hand must be accepted as not requiring justification. (Hayek 1976: 24)

Advocating, in this sense, 'reverence for the traditional' (1960: 63) does not mean, as Hayek explains, to 'maintain that all tradition as such is sacred and are exempt from criticism, but merely that the basis of criticism of any one product of tradition must always be other products of tradition which we either cannot or do not want to question' (1976: 25).

As long as we keep these provisos properly in mind, however, 'we must', Hayek suggests, 'constantly re-examine our rules and be prepared to question every single one of them' (1979: 167), and 'we must always strive to improve our institutions' (1960: 63). Hayek's approach does not only allow for, but explicitly assigns a systematic role to, rational and deliberate constitutional policy. In fact, constitutional analysis in the sense of a comparative study of the general working characteristics of alternative systems of rules, rather than the study of the concrete effects of particular measures should, in Hayek's view, be the major concern of economics. By providing such comparative information on the general characteristics of the outcome patterns that can be expected to result under hypothetical alternative rules, constitutional economics can serve as an important informational input for constitutional politics. Such constitutional policy is what, from a Hayekian perspective, we primarily have to rely upon in our 'endeavour to make society good in the sense that we shall like to live in it' (1973: 33).

Hayek says of his own approach that its 'emphasis is on the positive task of improving our institutions' (1960: 5) and he critically notes about the 'traditional liberal doctrine' that it has not paid sufficient attention to this task and has 'never developed a sufficiently clear programme for the development of a legal framework designed to preserve an effective market order' (1978: 145). In particular in his 1939 pamphlet, Freedom and the Economic System, the 'prelude' to his The Road to Serfdom (1972: xix), and in his 1947 address to the first meeting of what then became the Mont Pelerin-Society ('Free Enterprise and Competitive Order', 1948: l07.), Hayek defines a quite active role for constitutional politics or Ordnungspolitik, more so than in most of his later writings. He points out that the argument against the constructivist rationalist notion of social planning is not an argument against any kind of rational planning in social affairs. There is room for the 'construction of a rational framework of general and permanent rules' (1939: 10), we 'can "plan" a system of general rules', he argues, 'which provides an institutional framework within which the decisions as to what to do . . . are left to the individuals' (1939: 88).

In the 1970's Hayek has commented in the same vein on the then fashionable notions of 'national planning', stressing that the 'dispute between the modern planners and their opponents is . . . not a dispute on whether we ought to choose intelligently between the various possible organisations of society' (1978: 234) but rather it is about the constructivist rationalist 'claim that man can achieve a desirable order of society by concretely arranging all its parts in full knowledge of all the relevant facts' (1967: 88). While he considers such a claim to be no more than a fatal conceit Hayek leaves no doubt that in his view we not only can, but ought to, strive to 'achieve a desirable order of society' by improving the framework of rules and institutions within which we can pursue, separately and jointly, our various interests and purposes. There is according to Hayek, 'ample scope for experimentation and improvement within that permanent legal framework which makes it possible for a free society to operate most efficiently', and he adds: 'We can probably at no point be certain that we have already found the best arrangements or institutions (1960: 231). The issue of what may be, under ever changing circumstances the most desirable and effective system of rules, that is, the question of how the extent and limitations of property rights ought to be specified, has, in Hayek's view, found less attention within the classical liberal tradition than it deserves, a fact that, he suspects, may have contributed to some of the resentment that the liberal doctrine has attracted. Hayek's 1947 Mont-Pelerin address was clearly designed to correct this deficiency and to stress the role that the classical liberal doctrine ought to assign to a constitutional politics that aims at improving the 'legal framework' (1948: 110). That a functioning market presupposes the prevention of violence and fraud as well as the protection of or certain rights is, Hayek argues, 'always taken for granted'. But, he adds,

Where the traditional discussion becomes so unsatisfactory is where it is suggested that, with the recognition of the principles of private property of and freedom of contract . . . all the issues were settled, as if the law of property and contract were given once and for all in its final and most appropriate form. (Hayek 1948: 111) .

The 'real problem' begins, however, as Hayek notes, when we ask what the specific content of these general principles under particular circumstances ought to be and how their content ought to be adjusted to changing circumstances as they may result, for instance, from the invention of new technologies. The various and manifold issues which Hayek lists in this context include 'the law of property and contract, of corporations and associations, . . . the problems of taxation, and the problems of international trade' (1948: 113), as well as problems concerning 'the extension of the concept of property to such rights and privileges as patents for inventions, copyright, trade-marks, and the like' (ibid.:113.). In all these areas there is, in Hayek's view, a role to be played by rational analysis and design of rules and institutions or, in other words, for constitutional politics. In particular, with regard to the problem of the 'regulation of corporations' that has been briefly discussed earlier in this article, Hayek stresses the 'need for the deliberate creation of special legal institutions' and he comments that 'we should not be content to let the market develop appropriate institutions under the general principle of freedom of contract' (1967: 306).

 

Conclusion

The interrelation between the legal order or, more generally, the system of rules and the social pattern or order of actions resulting under those rules is, as stated at the beginning of this article, not only a central theme in Hayek's system of thought, it is the central theme of a constitutional political economy. It is a theme that, as Hayek (1969: 172) suggests, should have been all along the central problem of the group of disciplines that, in the German academic system, used to be called the Rechts- und Staatswissenschaften (the legal and social sciences). The eighteenth-century founders of political economy, David Hume and Adam Smith, were, as Hayek points out, 'indeed as much philosophers of law as students of the economic order, and their conception of law and their theory of the market mechanism are closely connected' (1967: 136). The subsequent separation of the legal and social sciences as well as the disciplinary fragmentation of the latter created, however, in Hayek's account, a situation where nobody systematically studies any more what was once the central unifying theme of these various sciences (1969: 173).

Reflecting in retrospect on his own intellectual development, Hayek supposes that it was his interest in the role of rules in social co-ordination that led him 'from technical economics into all kinds of questions usually regarded as philosophical' (1967: 91), and he views his own work as an attempt to re-establish the systematic inquiry into the core theme of classical political economy, and to contribute to a renewed 'interweaving of the philosophy, jurisprudence, and economics of freedom' (1960: 6). Much 'more closer collaboration between the specialists in economics, law, and social philosophy than we had in recent times' (1967: 92) is, Hayek supposes, required in order to further an understanding of the interrelation between rules an social order upon which an informed constitutional politics can be based.

Hayek's efforts to revive - within the context of the contemporary disciplinary specialisation of law and the various social sciences - the kind of integrated systematic study of the rules and order problem that was at the core of classical political economy, provide an important input to the research programme of modern constitutional political economy, a field for which the following quotation from Hayek's Rules and Order is an appropriate motto:

Yet, although the problem of an appropriate social order is today studied from the different angles of economics, jurisprudence, political science, sociology, and ethics, the problem is one which can be approached successfully only as a whole. (Hayek 1973: 4)

(An Excerpt from the Rules and Choice in Economics, Routledge, London, 1994)

 

Dr Viktor J. Vanberg, Professor of Economics, Albert Ludwigs Universität, Freiberg

 

 

References:

 

F. A. Hayek,

1. Freedom & the Economic System (Public Policy Pamphlet no. 29), Chicago: University of Chicago Press, 1939.

2. Individualism & Economic Order, Chicago: University Press, 1948.

3. The Constitution of Liberty, Chicago: University of Chicago Press, 1960.

4. "Kinds of order in society", New Individualist Review, Vol. 3, (2), 3-12, 1964.

5. Studies in Philosophy, Politics & Economics, Chicago: Univ. of Chicago Press, 1967.

6. Law Legislation & Liberty (Vol I, II, III Rules and Order), London & Henley: Routledge Kegan & Paul, 1973, 1976, 1979.

James Buchanan,

1. The Limits of Liberty- Between Anarchy and Leviathan, Chicago: University of Chicago Press, 1975.

 

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