The economics of friedrich hayek

Abstract

Friedrich A. Hayek's writings span seven decades. His Collected Works, now being edited, will reach (and probably exceed) twenty volumes. The secondary literature grows like topsy. How does one get a handle on all of this? Where does an economist start, who wants to understand Hayek's many contributions to knowledge? Even more difficult: where might one advise a student to begin? Gerry Steele's recent book, The Economics ofFriedrich Hayek, is certainly a viable candidate. Steele sympathetically summarizes Hayek's contributions to economics, and situates those writings within the broader scheme of his thought. The exposition is admirably concise and clear, yet still faithful to the subtleties of Hayekian analysis. Given the scope of Hayek's vision, Steele's book is an admirable achievement. It is not wholly without weaknesses, however, a point to which I will return. Steele employs a logical rather than a chronological approach to explaining Hayek's ideas. A brief introduction is followed by a chapter entitled Liberty and Law in which Hayek's writings about how individual intentional actions can produce unintended spontaneous orders are highlighted, then linked to notions of liberty. His ideas are contrasted with those of constructive rationalists, who believe that, if they are to yield the proper outcomes (those consistent with social justice, a favorite Hayekian weasel-word),