3. Friedrich von Hayek, Creative Powers of a Free Civilization

The Creative Powers of a Free Civilization
By Friedrich von Hayek

The Socratic maxim that the recognition of our ignorance is the beginning of wisdom has profound application to social life. If we are to comprehend how society works we must first become aware, not merely of our individual ignorance of most of the particular circumstances which determine its actions, but also of the necessary ignorance of man as such regarding much or most that determines the course of his society.

Our ignorance, however, is by its very nature the most difficult subject to discuss. At first it might even seem by definition impossible to talk sense about it. We cannot discuss intelligently something about which we know nothing. We must at least be able to formulate the questions to which we do not know the answers. For this purpose we must possess some generic knowledge about the kind of thing, or the kind of world, we are talking about. If we are to understand how society works we must in this manner recognize at least the fact and the range of our ignorance. Though we cannot see in the dark, to understand our conduct we must at least be able to trace the limits of the dark areas.

Civilization is built on the utilization of experience, acquired by countless individuals and generations and passed on through a process of communication and transmission of knowledge. The identification of the growth of civilization and the growth of knowledge which this suggests would be very misleading, however, if by “knowledge” we meant solely the conscious, explicit knowledge of individuals, the knowledge which means that we are able to state that this or that is so and so. It would be still more misleading if knowledge were confined to scientific knowledge and it is important for the understanding of the further argument to remember that, contrary to a fashionable view, scientific knowledge does not exhaust even all the explicit and conscious knowledge of which society makes constant use. The scientific methods of the search for knowledge are not suitable for satisfying all the needs for explicit knowledge on which the functioning of society is based.

Not all the knowledge of the ever changing particular facts, of the conditions of time and place of which man makes continuous use, lends itself to organization or centralized registration: much of it exists only dispersed among countless individuals. The same applies to that great part of expert knowledge which is not substantive knowledge but merely knowledge of where and how to find the needed information.

The growth of knowledge and the growth of civilization are the same only if we interpret knowledge to include all the human adaptations to environment in which past experience has been incorporated. Not all knowledge in this sense is part of our intellect and our intellect is not the whole of our knowledge. Our habits and skills, our emotional attitudes, our tools and our institutions – all are in this sense more or less effective adaptations formed by past experience, that have grown up by selective elimination of less suitable conduct and which are as much an indispensable foundation of successful action as is our conscious knowledge. Not all these nonrational factors underlying our action are always conducive to success. Many of them may be retained long after they have outlived their usefulness and even when they have become more an obstacle than a help. Nevertheless, we could not do without them: even successful employment of our intellect itself rests on their constant use.

I have spoken of the transmission and communication of knowledge in order to point to two different aspects of the process of civilization. One is transmission in time, the handing on from generation to generation of an accumulated stock of knowledge. The other is communication among contemporaries of information on which they base their actions. These two aspects cannot be sharply separated, because the various means of communication between contemporaries are among the most important parts of cultural heritage, of the transmitted tools which man, without understanding them, constantly uses in the pursuit of his ends.

This is familiar so far as it applies to the process of accumulation and transmission of that abstract, conscious knowledge which we call science, and also with regard to our awareness of the concrete features of the world in which we live – the “geography” of our surroundings. But this is only a part, though the most conspicuous part, of the inherited stock of experience and it is the only part of which we necessarily “know,” in the ordinary sense of the word. Yet we are better equipped to deal with our surroundings also because of the many “tools” other than conscious knowledge which we possess – tools the human race has evolved by a process of learning and handing on of the results. I stress the results here because the ever-better tools that have been passed on to successive generations embody only the results of experience without the whole of the experience being transmitted. Once the more efficient tool is available it will be used without the user knowing why it is better or even what the alternatives are.

In this sense the “tools” which man has evolved, and which are such an important part of his adaptation to his environment, do not consist solely of material implements, nor even of kinds of conduct that he individually uses as a means for a purpose. Man is in a large measure ignorant not only of why he uses some tools rather than others, but also of what depends on his actions, of how far the results which he achieves are conditioned by conforming to habits of which he is unaware. This applies to civilized man not less but perhaps even more than to primitive man. With the growth of conscious knowledge there has been an equally important accumulation of tools in this wider sense, of tested and generally adopted ways of doing things. An advanced civilization and all the activities of civilized man, including his rational thought, depend as much on the unreflected use of these procedures as do the simplest kinds of human life.

Every man who participates in civilization constantly benefits from current human experience which is not his own, and is led at the same time to take part in a process or adaptation to ever-changing circumstances of most of which he knows little. Yet in these changes the whole structure of society must share if it is to continue to exist. The persistence of an order through continuous change is based on a division and combination of knowledge among different persons, an aggregate of different sorts of knowledge the whole of which no single person can command.

Every change in conditions will make necessary some change in the use of resources, in the direction and kind of human activities, in habits and practices. And each change in the actions of those affected in the first instance will require further adjustments that will gradually extend through the whole of society. Every change thus in a sense creates a “problem” for society, even though no single individual perceives it as such; it is gradually “solved” by the establishment of a new overall adjustment. Those who take part in the process have little idea why they are doing what they do, and we have no way of predicting who will at each step first make the appropriate move or what particular combinations of knowledge and skill, personal attitudes and circumstances will suggest to some man the successful answer or by what channels his example will be transmitted to others who will follow the lead. It is difficult to conceive all the combinations of knowledge and skills which thus come into action, and from which arises the discovery of appropriate practices or devices that once found can be accepted generally. But the countless number of humble steps taken by anonymous persons, in the course of doing familiar things in changed circumstances, set the examples that prevail as the best after many have tried in their own way. They are as important as the major intellectual innovations which are explicitly recognized and communicated as such.

Who will prove to possess the right combination of aptitudes and opportunities to find the better way is just as little predictable as by what manner or process different kinds of knowledge and skill will combine to bring about the solution of the problem. The successful combination of knowledge and aptitude does not, of course, normally result from people “putting their heads together” – from any process of thinking out in common the solution of their task. It results rather from imitation of what we have seen others do in similar circumstances and from an effort to improve upon their actions; from individual response to symbols or signs such as changes in prices or expressions of moral or esthetic esteem; from observing standards of conduct; in short, from using results of the experiences of others, past and present. The method by which only selected elements of relevant knowledge are brought to the different individuals, who base their decisions upon them, rests on factors which as a whole are as little known to anybody as all the circumstances which can be communicated by them.

What is essential to the functioning of the process is that each individual is able to act on his particular knowledge, always unique at least so far as the knowledge of some particular circumstances is concerned; that he may use his individual skills and opportunities within the limits known to him and for his own individual purpose.

Man learns by the disappointment of expectations. Of course we should not add elements of unpredictability by foolish human institutions, in which case the stultification of our efforts would teach us nothing significant. We should, rather, improve human institutions with the aim of increasing the possibility of correct foresight. But we should above all provide the maximum of opportunity for unknown individuals to learn facts of which we are yet unaware and opportunity to use this knowledge in their actions. For the achievement of our ends depends on forces which we do not know in detail and whose operation we understand only to a small degree.

It is in the utilization, in the mutually adjusted efforts of different people, of more knowledge than anyone possesses or than it is possible intellectually to synthesize, that achievements emerge that are greater than any one man’s mind can foresee. We sometimes forget that freedom means the renunciation of direct control of individual efforts and the limitation of coercion to the enforcement of abstract rules. It is because of this renunciation of the use of coercion for the achievement of specific ends that a free society can make use of so much more knowledge than the mind of any ruler can comprehend.

From this foundation of the argument for liberty it follows that we shall not achieve its ends if we confine liberty to the particular instances where we know it will do good. Freedom granted only where it can be known beforehand that its effects will be beneficial would not be freedom. If we know how freedom would be used, the case for it would largely disappear. We could then achieve the same result by telling people to do what freedom would enable them to do. But we shall never get the benefits of freedom, never obtain those unforeseeable new developments for which it provides the opportunity, if it is not granted also where the uses made of it by some do not seem desirable. It is therefore no argument against individual freedom that it is frequently abused or used for ends that are recognized as socially undesirable. Our faith in freedom rests not on demonstrable results in particular circumstances, but on the belief that it will on balance release more forces for the good than for the bad.

It also follows that the importance of freedom to do particular things has nothing to do with the question of whether we or the majority are ever likely to make use of that particular possibility. To grant no more freedom than all can exercise would be completely to misconceive its function. The freedom that will be used by only one man in a million may be more important to society and more beneficial to the majority than any freedom we all use.

Indeed, it might almost be said that freedom to do a particular thing is the more precious for society as a whole the less likely the opportunity for its use. The less likely it is that the opportunity will occur, the more unlikely also that the experience to be gained will be recovered if such a nearly unique chance is missed. It is also probably true that the majority is not directly interested in most of the things it is most important that we should be free to do. If it were otherwise, the results of freedom could also be achieved by the majority deciding what should be done by individuals. But majority action is of necessity confined to the already tried and ascertained, to issues on which agreement has already been reached in that process of discussion that must be preceded by different experiences and actions on the part of the different individuals.

The benefits I derive from freedom are thus largely the result of the uses of freedom by others, and mostly of uses of freedom that I myself could never make. It is therefore not merely and not even mainly the freedom which I can exercise myself which is important for me. It may even be that in many ways freedom for others is more important for us than freedom for ourselves, and it is certainly more important that anything can be tried by somebody than that all can do the same things. It is not because we like to be able to do particular things, not because we regard any particular freedom as essential to our happiness, that we have a claim to freedom. The instinct that makes us revolt against any physical restraint, though a helpful ally, is not always a safe guide for justifying or delimiting freedom. What is important is not what freedom I personally would like to exercise but what freedom some odd person may need in order to do things beneficial to society, a freedom we can assure to this unknown single person only by giving it to all.

The undesigned “new” factors that constantly emerge in the process of adaptation consist in the first instance of new arrangements or patterns in which the efforts of different individuals are coordinated, and of new constellations in the use of our resources, which are in their nature as temporary as the changed conditions that have evoked them. There will, also, be modifications of tools and institutions adapted to the new circumstances. Some of these will be purely temporary adaptations to the conditions of the moment, while others will prove to be improvements, increasing the versatility of the existing tools and usages, and will therefore be retained. They constitute a better adaptation not merely to the particular circumstances of time and place but to some permanent feature of our environment. In such spontaneous “formations” is embodied a perception of the general laws that govern nature. Parallel with this cumulative embodiment of experience in tools and forms of action will go a growth of explicit knowledge, of formulated generic rules that can be communicated by language from one person to person.

This process by which the new emerges is relatively best known and most readily comprehensible – though still inadequately appreciated – in the intellectual sphere where the results are new ideas. It is the field in which most people are aware at least of some of the individual steps in the process, where we necessarily know of what is happening and where the necessity of freedom is consequently fairly generally understood. Most scientists realize that we cannot plan the advance of knowledge, that in the voyage into the unknown which the enterprise of research always is, we are in great measure dependent on vagaries of individual genius and of circumstances, and that, though a new idea will spring up in a single mind, it will be the result of a combination of concepts, habits, and circumstances brought to one person by society, the result of lucky accidents as much as of systematic effort.

Because we are necessarily aware that our advances in the intellectual sphere spring often from the unforeseen and undesigned, we tend to overstress the relative importance of freedom in this field compared with the importance of the freedom of doing things. But the freedom of research and belief, and of speech and discussion, the importance of which most people recognize, refers only to the last stage of the process in which new truths are discovered. It would be like treating the crowning part of an edifice as the whole of it if we were to extol the value of intellectual liberty at the expense of the value of the liberty of doing things. If we have new ideas to discuss, different views to adjust, it is because these ideas and views arise from the efforts of individuals in ever-new circumstances, availing themselves of concrete tasks of the new tools and forms of action of which they have learnt. The intellectualist view that stresses exclusively the formation of abstract and generic ideas is a consequence of the fact that this part of the process of the advance of knowledge is the most obvious and the one with which those who think about its nature are most familiar and in which they have a special interest.

The nonintellectual part of the same process, the formation of the changed material environment in which the new emerges, requires for its understanding and appreciation a much greater effort of the imagination. We may sometimes be able to reconstruct the intellectual processes that have led to a new idea, but we can scarcely ever hope to reconstruct the sequence and combination of the contributions that did not consist in the acquisition of new explicit knowledge – all the favorable habits and skills employed, the facilities and opportunities used, and the particular environment of the main actors that has brought about the result. Our efforts toward understanding that part of the process can go little further than showing on simplified models the kind of forces that are at work, the general principle rather than the specific character of the influences that operate. In the nature of the thing each man can always be concerned only with what he does know. Therefore, those features which, while the process is under way, are not consciously known to anybody, are commonly disregarded and can perhaps never be traced in detail.

The manner in which we have learnt to order our day, to dress, to eat, and arrange our houses, to speak, write, and use the countless tools and implements of civilization, no less than the “know-how” used in production and trade, all furnish us constantly with the foundations on which our own contributions to the process of civilization must be based. And it is in the new use and improvement of whatever the facilities of civilization offer to us that the new ideas arise which are ultimately handled in the intellectual sphere.

Thus, the importance of freedom does not depend on the elevated character of the activities that it makes possible. Freedom of action, even action in humble things, is as important as freedom of thought and freedom of belief. It has become a common practice to disparage liberty of action by calling it “economic liberty.” But not only is the concept of liberty of action much wider than that of the economic liberty which it includes; what is more important, it is very questionable whether actions which can be called purely economic exist in this sense, and whether any restrictions on liberty can be confined to what are called merely economic aspects. Economic considerations are merely the process by which we endeavor to reconcile and adjust our different purposes, which in the last resort are all not economic.
Most of what has been said so far applies not only to man’s use of the means for the achievement of his ends but also to these ends themselves. It is one of the essential characteristics of a free society that its goals are open, that new ends of conscious effort can spring up, first with a few individuals or a small minority, to become in time the ends of all or most.

We must recognize that even what we regard as good or beautiful is changeable, if not in any recognizable manner that could entitle us to take any kind of relativist position, yet in the sense that in many ways we do not know what will appear as good or beautiful to another generation; we do not know why we regard this or that as good, or who is right when people differ on whether something is good or not. It is not only in his knowledge, but also in his aims and values, that man is the creature of the process of civilization, and in the last resort it is the significance of these individual wishes for the perpetuation of the group or the species that will determine whether they will persist or change. It is of course a mistake to believe that we can draw conclusions about what our values ought to be, because we realize that they are a product of evolution. But we cannot reasonably doubt that these values are created and altered by the same evolutionary forces that have produced our intelligence. All that we can know is that the ultimate decision about what is accepted as right and wrong will be made not by individual human wisdom but by the disappearance of the groups that have adhered to the “wrong” beliefs.

It is in the pursuit of man’s aims of the moment that all the devices of civilization have to prove themselves; that the ineffective is discarded and the efficient handed on. But there is more to it than the fact that new ends constantly arise with the satisfaction of old needs and with the appearance of new opportunities. Which individuals, and which groups, succeed and continue to exist depends as much on the goals which they pursue, the values that govern their action, as on the tools and capacities at their command. A group may prosper or be extinguished just as much because of the ethical code that it obeys, or because of the ideals of beauty or well-being that guide it, as because of the degree to which it has learned or not learned to satisfy its material needs. Within any given society particular groups may rise or sink because of the ends they pursue and the standards of conduct which they observe. And the ends of the successful group will tend to become the ends of all members of society.

At most we understand only partially why the values we hold, or the ethical rules we observe, are conducive to the continued existence of our society. Nor, under continuously changing conditions, can we be sure that all the rules that have proved themselves as conducive to that purpose will remain so. Though there is a presumption that any established social standard contributes in some manner to the preservation of a civilization, our only way of knowing this is to ascertain whether it continues to prove itself in competition with other standards tried by other individuals or groups.

The competition, on which the process of selection rests, must be understood in the widest sense of the term. It is as much a competition between organized and unorganized groups as a competition among individuals. To think of the process in contrast to cooperation or organization would be to misconceive its nature. The endeavor to achieve specific results by cooperation and organization is as much a part of competition as are individual efforts, and successful group relations also prove their efficiency in competition between groups organized on different principles. The distinction relevant here is not between individual and group action but between arrangements in which alternative ways based on different views and habits may be tried, and on the other hand, arrangements in which one agency has the exclusive rights and the power to coerce others to keep out of the field. It is only when such exclusive rights are granted, on the presumption of superior knowledge of particular individuals or groups, that the process ceases to be experimental and the beliefs that happen to be prevalent at the moment tend to become a main obstacle to the advancement of knowledge.

It is worth a moment’s reflection as to what would happen if only what was agreed upon to be the best knowledge of society were to be used in any action. If all attempts that seemed wasteful in the light of the now generally accepted knowledge were prohibited and only such questions asked, or such experiments tried, as seemed significant in the light of ruling opinion. Mankind might then well reach a point where its knowledge allowed it adequately to predict the consequences of all conventional actions and where no disappointment or failure would occur. Man would seem to have subjected his surroundings to his reason because nothing of which he could not predict the results would be done. We might conceive of a civilization thus coming to a standstill, not because the possibilities of further growth had been exhausted, but because man had succeeded in so completely subjecting all his actions and his immediate surroundings to his existing state of knowledge that no occasion would arise for new knowledge to appear.

There can be little doubt that man owes some of his greatest successes in the past to the fact that he has not been able to control social life. His continued success may well depend on his deliberately refraining from exercising controls now in his power.

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