ISSN 2291-5079 Vol 5 | Issue 3 + 4 2018 COSMOS + TAXIS Studies in Emergent Order and Organization COVER ART: COSMOS + TAXIS Paula Wright Studies in Emergent Order and Organization Ryton Oak (Gold) 2016 VOL 5 | ISSUE 3 + 4 2018 www.paulawrightart.wordpress.com
IN THIS ISSUE EDITORIAL BOARDS
ARTICLES HONORARY FOUNDING EDITORS EDITORS Civil Society as a Complex Adaptive Phenomenon . . . 3 Joaquin Fuster David Emanuel Andersson* University of California, Los Angeles (editor-in-chief) Mikayla Novak David F. Hardwick* RMIT University, Vietnam Reconsidering Urban Spontaneity and Flexibility The University of British Columbia William Butos after Jane Jacobs: How do they work under Lawrence Wai-Chung Lai (deputy editor) Trinity College different kinds of planning conditions? ...... 14 University of Hong Kong Frederick Turner Laurent Dobuzinskis* Stefano Cozzolino University of Texas at Dallas (deputy editor) Simon Fraser University Cities, Agriculture, and Economic Development: Leslie Marsh* The Debate over Jane Jacobs’s ‘Cities-First Thesis’ . . 25 (managing editor) Sanford Ikeda The University of British Columbia Detecting and Directing Emergent Urban Systems: assistant managing editors: a Multi-Scale Approach ...... 32 Thomas Cheeseman Elena Porqueddu Dean Woodley Ball Alexander Hamilton Institute Connecting the Dots: Hayek, Darwin, and Ecology . . . 51 Gus diZerega The Role of Spontaneous Order in Video Games: CONSULTING EDITORS A Case Study of Destiny ...... 63 Corey Abel Peter G. Klein Denver Baylor University William Gordon Miller Thierry Aimar Paul Lewis Sciences Po Paris King’s College London Nurit Alfasi Ted G. Lewis REVIEWS Ben Gurion University Technology Assessment Group of the Negev Salinas, CA The Infidel and the Professor: David Hume, Theodore Burczak Joseph Isaac Lifshitz Adam Smith, and the Friendship that Denison University The Shalem College Shaped Modern Thought Gene Callahan Jacky Mallett by Dennis C. Rasmussen...... 73 Purchase College Reykjavik University Gordon Graham State University of New York Alberto Mingardi Chor-Yung Cheung Istituto Bruno Leoni Legislating Instability: Adam Smith, Free Banking, City University of Hong Kong Stefano Moroni and the Financial Crisis of 1772 Francesco Di Iorio Milan Polytechnic by Tyler Beck Goodspeed ...... 78 Nankai University, China Edmund Neill Pablo Paniagua Gus diZerega* New College of the Humanities Taos, NM Christian Onof National Economic Planning: What Is Left? Péter Érdi Imperial College London by Don Lavoie...... 86 Kalamazoo College Mark Pennington Pablo Paniagua Evelyn Lechner Gick King’s College London Dartmouth College Jason Potts Envisioning Real Utopias by Erik Olin Wright...... 94 Peter Gordon Royal Melbourne Institute David Ellerman University of Southern California of Technology Cognitive Autonomy and Methodological Individualism: Lauren K. Hall* Don Ross Rochester Institute of Technology University of Cape Town and The Interpretative Foundations of Social Life Sanford Ikeda Georgia State University by Francesco Di Iorio...... 104 Purchase College Virgil Storr Gabriele Ciampini State University of New York George Mason University Andrew Irvine Stephen Turner The University of British Columbia University of South Florida Editorial Information...... 109 Byron Kaldis Gloria Zúñiga y Postigo The Hellenic Open University Ashford University
*Executive committee http://cosmosandtaxis.org COSMOS + TAXIS
Civil Society as a Complex Adaptive Phenomenon MIKAYLA NOVAK
RMIT University, School of Economics, Finance and Marketing RMIT College of Business Building 80 445 Swanston Street Melbourne, 3000, Australia
Email: [email protected] Web: https://mikaylanovak.com
Abstract: I depict civil society as a complex and adaptive phenomenon. Individuals and groups within civil society interact with each other to achieve mutually agreeable outcomes, and this gives rise to identifiable spontaneous orders of economic, communal and political relationships. Civil society is not a mere aggregation of these sub-orders but a combinatorial ensem- ble of them in that a multiplicity of dispositions, interests and values, and relevant feedback mechanisms, co-exist tenuously, often contradictorily and in entangled fashion. This paper describes the general processes in which alternative perspectives within civil society continuously vie against each other for widespread support, and critically appraises the suggestion that certain aspects of economic, social or political evolution portend the “decline” of civil society itself. The distinct value of the civil society concept lies in the capacity of diverse individuals to arrange mutually agreeable adjustments in the absence of domination or subjection. 3
Keywords: adaptation, civil society, complexity, evolution, meso, structure, spontaneous order
INTRODUCTION Inspired by developments in complexity and evolution- COSMOS + TAXIS + TAXIS COSMOS ary science literatures, especially their applications in social As observed throughout the course of human history and scientific contexts, I depict civil society as a complex and in all the places human beings inhabit, individuals inces- adaptive phenomenon. To be more specific, civil society is santly interact with others in the pursuit of benefits and that combinatorial sphere of cooperative relations between achievements. A broad-scale conception of the domain individuals and groups of people spanning the economic, through which varying guises of human association takes communal and political orders, with each order consist- place is coined “civil society,” and the objective of this paper ing of both spontaneous and non-spontaneous elements is to provide an account of its nature and salient features. (diZerega 2014; Madison 1997). Any attempt to provide a definitive account of civil soci- The explanation of civil society as a structured process ety surely poses as an intellectually tall order. This reflects (embodying complexity) unfolding in novel, and often recognition that “civil society is a … necessarily contest- unforeseen, ways (reflecting adaptation) yields several im- ed idea” and is “not a concept that yields to easy consen- portant insights. This approach invites an inclusive, non- sus, conclusion, or generalization” (Edwards 2011, 480). reductionist approach toward examining the kinds of Ambiguities surrounding the definition of civil society re- relationships and interdependencies forged when humans flect scholarly disputes over the appropriate scope of human act to procure gains from each other. It also draws attention activity to be encompassed within the civil society notion, to the claim economic, communal and political situations as well as contestation surrounding the normative propriety within civil society are, themselves, the manifestation of of claims made about its efficacy in explaining the trends decentralised actions by the many, and not the intentional and tendencies of actual societies. Difficulties in grasping design by the few. Finally, understanding civil society as a the idea of civil society may also be attributable to shifts complex, adaptive phenomenon helps us to understand and and permutations in the kinds of cooperative human activi- appreciate the implications of observed changes that both ties undertaken therein. surround us, and in which we participate.
Civil Society as a Complex Adaptive Phenomenon ------or thesis of between the “family” doux-commerce society organized in a particular intermediate , these being orders nothing other than the sedimented ” (Madison 1997, p. 36). Within 36). p. this expansive,” (Madison 1997, and un The inclusion of The each,or inclusion all,of forms the aforementioned G. B. Madison described best it called when he a for The The nineteenth-century French aristocrat Alexis de I conceive civil conceive I society as generically composed three of and social groupings encouraged Americans devise to their own rather problems, to solutions than depending upon so do to purportedly government their on behalf. Residing between atomistic individuals and the overbearing state, the constellation free of and intermediate associations de scribed Tocqueville by undergirded a vibrant civil society. human of activity in definitiona of civil society has long elicited intellectual dispute, with arguments which over of these forms interaction of should be excluded. By contrast I thereconsider is merit in pursuing the alternative a more of inclusive stance concerning which relationships should be classified as beingrepresented in civil society. wouldThis openly usenable more to recognise different, and in fact the oft-intertwined, ways in whichhumans associate and min gle with and each the other, opportunities and challenges peacefor and prosperity arising fromsuch interdependen cies. extensive conception civil “more of society” informto anal ysis human of association, in which the civil of notion soci ety itself “an is entity not tive opportunity enhance to living standards, those even for in economicallyimpoverished positions. Furthermore, in sentiments reminiscent the of Montesquieu,the France’s Scotsman conceivedthat com greatly “contributes mercial development the to extirpa tion and prejudice of parochialismand the cultivation of a shared sense humanity. of Commerce polishes the away rough edges human of nature and leads the to cultivation of civility 444). p. and manners” 2013, (Boyd Tocqueville studied the social and political conditions un derpinning the formative American democracy, and in so doing formulated yet another civil of version society theo Intermediate ry. associations,both local and voluntaryin their character, elevated were as the of pivotal component civil society. Tocqueville that noted diverse associations ashamedly pluralistic, definition, Madison submitted that society is“[c]ivil composed distinct of yet overlapping ders results human of agency in differentof spheres life”(Ibid., p. 37). nested and systems ordered in which humans interact to derive advantages andto benefits conducive their senses and the as … but “state” way ------For SmithFor the sheer scale and scope market of activities, Witnessingthe embryonic phase the of British Industrial Lockean harmony in the state nature of did suggest, not Contrary suggestionthat Hobbes’s to the nature” of “state I now turnI now the to structure First, the of paper. I draw reflecting an increasing provideddivisionlucra a of labour, humannature “to truck,barter, and exchangething one for another.” place within markets served as the centrepiece civil of so The ciety. tradingof commodities between sellers buy and ers, according Smith, to echoed a certain inclination within Revolution, theRevolution, Scottish Enlightenment figureAdam Smith suggested that voluntary exchange relationships taking society was coterminous with this political mutually order agreed as upon, if culminating in the a “social form of con tract,” the by society. members of could be legitimately instituted the for relatively limited purpose instituting of protecting laws properties justly ac quired and individuals. by held Locke, For the civil idea of however, that conflicthowever, and woulddiscord non-existent.be Therefore, Lockehypothesised “political a that society” ereignty exercised political by actors quell to it, John Locke considered that generally people tended be to naturally co operative and peace-loving in their natural state. of humanof interaction is characterised endlessly by violent frictions, necessitating nothing less than the sov absolute prominent positionprominent within the classical liberal philosophi cal tradition since its very inception, arguably during the seventeenth century. SPONTANEOUS ORDERS SPONTANEOUS Theorising about naturethe of civil society has assumed a in “decline.” I finishby making concludingremarks. OF MEDLEY A COMPLEX AS CIVIL SOCIETY ety explicated in this paper critically to assess the claim that observed changes necessarily illustrate that civil society is the mostpopular insights potentially become embedded in the institutional frameworks civil of society as enduring rules. Next, I draw the upon dynamic picture civil of soci ety. Entrepreneurialety. action sets discover to modes out novel conduct,of the entrepreneurial insight is then competitive ly testedagainst other insights prospectivefor support, and adaptive phenomenon. This adaptiveby followed phenomenon. is an analysisof a multi-phase processes inwhich changeis realised through the economic, communal and political civil of orders soci upon a rangeupon contemporary of social scientific insightsto depict properties generic some civil of society as a complex, VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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of prosperity and wellbeing: the economic order; the com- movements in relative prices (which, in turn, inform shifts munal order; and the political order. The three orders in profitability), superimposing a rank of goods and ser- mentioned here can be construed as spontaneous orders, a vices according to their relative value in competing uses. dynamic pattern of mutually adaptive relationships which Relatively higher prices induce consumers to ration yet arises from a broad-scale agreement about rules rather than encourage suppliers to invest and produce more output; results: relatively lower prices induce consumers to accumulate yet discourage suppliers to invest and produce more. That said, [s]pontaneous orders are discovery processes struc- prices are not necessarily unambiguous bits of information tured by abstract procedural rules through which and so there is scope for relative price changes to be subject individual plans responding to local knowledge and to interpretation and understanding, instead of necessar- personal insight are brought into greater coherence ily reflexive action and reaction (Lavoie 1986; Ebeling 1991; with similar plans by an infinite number of other in- Dekker and Kuchař 2017). dividuals mutually unknown to each other (diZerega It is often overlooked by market critics that the unceas- 2008, p. 1). ing mutual adjustments in market settings, which are the product of oftentimes bustling and rivalrous interactions The observed regularities arising through spontaneous between people to exchange valuable commodities on mu- orders come about as individuals, and groups of individu- tually agreeable terms, happen to foster spontaneously or- als, follow particular rules of conduct which are indepen- dered cooperation between millions of strangers (Rubin dent of any specific or particular end (McCabe and Pitt 2014). To put it simply, “Paris gets fed.” Virgil Storr (2008) 2011). Other features of (highly functional) spontaneous also observed the markets composing the economic or- orders include: that the rules underpinning a given order der serve as a forum through which friendships and other 5 apply to all participants in equal measure, with no discrim- social relationships emerge, contravening the suggestion inatory exemptions or privileges on the basis of personal that market-based interactions are always and everywhere identity or affiliation evident; that positive and negative anonymous and impersonal. feedback mechanisms exist to facilitate cooperation and The idea that the economic order is a fount of mutual as- encourage mutually beneficial outcomes; and that individu- sistance provides an almost perfect segue to a description COSMOS + TAXIS + TAXIS COSMOS als can freely enter into, and exit from, arrangements which of what I call the communal order, which was at the heart pervade the given spontaneous order and, indeed, may of Tocqueville’s seminal meditation on civil society yet has challenge pervading notions of “what works” by proposing seemingly vanished from much of modern classical liberal novel ideas and solutions (diZerega 2008; Potts 2013). scholarship for varied reasons (Cornuelle 1993; Ealy 2005; I now turn to briefly outline the key characteristics of the Garnett Jr. 2011). economic, communal and political orders of civil society in Richard Cornuelle was best known for his unremitting which humans extensively interact. call to include what he called the non-market, non-state The conception of markets within the economic order “independent sector” (I consider this to be a major element as a spontaneously ordered form of mutual cooperation of the communal order) into a comprehensive theory of between producing, trading and consuming strangers is civil society. He referred to the communal order as a spon- arguably the central proposition expounded by scholars taneous order in the respect that “[c]ommunity is a conse- within the mainline tradition of political economy (Boettke quence. It results when people come together to accomplish 2012). For one of the figureheads of this mainline tradition, things that are important to them and succeed” (Cornuelle Friedrich Hayek, the “marvel of the market” rests upon 1993, p. 32). its unheralded capacity to distil and coordinate dispersed Action in the communal order is predominated by al- economic knowledge—of how, why, where and when to truistic and solidaristic acts between people. Oftentimes, produce, trade, and consume goods and services—that is individuals self-organise into agencies and other bodies possessed in fragmented, locally situated forms by multi- to provide and to carry out acts of caring and enlighten- tudes of idiosyncratic individuals. ment. In the United States alone “[t]here are hundreds How does economic knowledge become coordinated, of universities, elementary and secondary schools, thou- generating wealth within the reach of evermore members sands of hospitals, museums, symphony orchestras, and of civil society? Coordination is achieved with the aid of libraries, thousands of mutual aid groups like Alcoholics
Civil Society as a Complex Adaptive Phenomenon ------specifiable interests.Political leaders and any By no meansBy no spontaneous do eschew orders the of role Indemocracies abstract criteria political for member ship and procedures participation for can be linked with measures are selected balloting by in which every counts vote equally,citizen’s and in which procedur aland reasonably open criteria determine runs who office. for Civilliberties safeguard anindefinite and unpredictable variety political of opinions and pro grams. speech of Freedom can be used support to or attack political leaders and their policies.… Criteria democraticfor citizenship and participation are com divorcedpletely from citizens’ substantive views and values 765). p. (diZerega 2001, The markof a functional political order is the potentially As is the case the for economic and communal orders, the The efficacy of the political orderfrom this de standpoint must maintain an open mind if the democratic mechanism 99). p. all” at is 1999, work to (Buchanan [1954] purposeful action individuals, by individuals, groups of or achieveto their objectives in concert with others. Although centralised, top-down planning was construed liber by als as inimical market to functioning, associational life, and democratic deliberation, “decentralized planning by indefinite and unpredictablenumbers of political positions competing the for democratic affectionsof general the pub The licMadison (diZerega unfolding1989; 1990). spontane politics of ous order embodies the fundamental that notion political decisions are the discovery product of processes orchestrated sovereign-citizens. by Buchanan also reminds us that “democracy discussion” by as “government implies thatindividual values can and change do in the process decision-making.of must be Men free choose, to and they vote, freedom speech of and organization, of and the like” emphasis in original). 215-216; pp. (diZerega 1989, politicaldoes exist, not order is designed, it nor serve to any particular purpose achieve to or any specificgoal (Madison the valuethe of democratic According Nell to (2017), 1990). process is that facilitates the articulation from the bottom- valuableas of were, it up, information—including that whichseems be to tacit, otherwise or unconveyed, knowl edge political about demands preferences. or pends,course, of an upon abiding respect certain for norms and procedures facilitating a continuous “discussion,” in the Knightian sense, amongst all those potentially affected by policy changes: ------the entire ensemble of : free elections, one-person-one- The representationof The democratic political deliberation Social and interest movements groups, along with the Several scholars suggestthat feedback signals exist within Alsosituated within the communal civil of order soci The The contributionsphilanthropistsof and social entrepre taneous order, democracytaneous to refers order, citizensand their interactions when they observe the basic rules democratic politics of as a spontaneous is in covered order several works Gus by a spon “[a]s In view, diZerega’s 2011). 2001, diZerega (1989, mocratising effect of people interacting within the commu nal brings order a third to me kind spontaneous of order situated within civil society—namely, the political order. democratic citizens and promoting an the appreciation of obligations as well asthe rights democratic of citizenship” Insights into the potentially 7-8). (Diamond 1994, pp. de other manifestations associational of life within the com important play munal “in roles order, stimulating political participation, increasingthe political efficacyand skill of of mutualof assistance (Boettke and Coyne 2009; Chamlee- and 2008). Wright Myers demonstrate an effectiveness in the fulfilment oftheir missions,and time, provide incentives investment for (of in andmoney worthwhile degree engagement) of ventures ing the economic order. Ining the the communal economic order. is it sup order posed that reputational mechanisms direct help and donors supporterstoward credible groups and associationswhich thecommunal participants help to order “do well do by ingeven if good,” the feedbacks are less finely grained than relativemechanisms prices and profit-and-loss condition ways in which can people cooperate and align their prerog atives. business associations and labour utilise who unions) their understandings divergent economic, of social and politi cal alternative, life promote to and prospectively improved, ety example, are social racial (for movements equality and queer rights activists) example, and interest groups (for volved involved special causes, through or which people to help ef fectually build their capabilities, self-esteem and resilience. neurs as great of import the to maintenance non-com of mercial assistance and reciprocity in be it the grant form of funding goods-in-kind or the to needy participants to or in through which amputees can trade their uselessor left right shoes 7). gloves”1992, or (Cornuelle p. Anonymous, vis only its mention more of to few a entities.ible institutions Its range from the giant Teachers’ Insurance and Annuity Association, a clearing … to house VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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many separate persons” (Hayek [1945] 1948, p. 79) is an als design, shape and direct their own lives, guided by their entirely legitimate mode of human interaction (see also own interests, ideals, and passions (Ebeling 1993). The key Vaughn [1982] 1994). A corollary of such insight is that “[s] condition, of course, is that each and all respect the equal ocial systems (of the human kind) are mixtures of delib- liberty of others to engage in activities, and pursue their ob- erate arrangements of man-planner-designer, interacting jectives, without rendering harm. with complex, spontaneously emerging orders, increasingly complex and important, made by no one, preconceived by THE ADAPTIVITY OF CIVIL SOCIETY: no one, foreseen by no one. Both aspects—artificial and A MESO PERSPECTIVE natural, man-made and spontaneous, designed and self- produced, simple and complex—should be studied in their Civil society is the epitome of the notion that, to paraphrase interaction and mutual co-determination” (Zeleny 1985, p. Friedrich Hayek, a person can live in many worlds at once. 118). Although one can make intellectual distinctions concern- The civil society notion entails several degrees of phe- ing how the medley of spontaneous orders work, it should nomenal complexity over and above those prevailing in any be recognised that the orders themselves are not insular or given component spontaneous order. Hayek once observed impregnable. that the character of (civil) society is such that “the whole As highlighted by Richard Wagner (2007, 2010, 2016), is more than the mere sum of its parts but presupposes also civil society is exhibited by interactionist entanglements be- that these elements are related to each other in a particular tween individuals and their enterprises, organisations and manner” (Hayek 1967, p. 70). Thus, the irreducibility of civil ventures across the economic, communal and political or- society to given actions by individuals, with their heteroge- ders. It is this entanglement of human relations which gives neous values, beliefs, purposes, plans and ideas, indubitably credence to the widely-held observation by social theorists 7 reflects the ensemble of those interactions and relationships that civil society possesses “structure,” and for others still, that people forge (Martin 2011; Lewis 2011). especially Hayek (1964, p. 10), “the structure of modern so- The activities of those interacting within a given sponta- ciety has attained a degree of complexity which far exceeds neous order are shaped somewhat by the incentive-feedback that which is possible to achieve by deliberate organization.” signals emergent from within each order—that is, relative Although the entangled structures inhabiting civil soci- COSMOS + TAXIS + TAXIS COSMOS prices of the market order; reputation and esteem of the ety are of great significance, our analysis of the nature of communal order; and votes of the political order. That a be- civil society would be incomplete if it were to rest solely wildering array of ordered interactions takes place implies upon describing its structural properties. Buckley (1968, that civil society itself accommodates a thick multiplicity p. 497) criticised the focus of sociological (and presumably of values in ways that the thinner economic, communal or other social scientific) studies upon structural concepts, political orders singularly cannot. This is because “feedback suggesting that this has led to “a rather static, overly deter- signals arising from different spontaneous orders merge ministic, and elliptical view of societal workings.” Indeed, within the more encompassing cosmos of civil society. “for the sociocultural system, “structure” is only a relative Collectively these signals help people make the decisions stability of underlying, ongoing micro-processes” (Buckley needed to achieve their goals more effectively. But no single 1968, p. 497). signal dominates. Each member attends to the feedback sig- Observing the structural ramparts of civil society are one nals they wish, as much as they wish, and ignores the rest” thing, but comprehending “the actions and interactions of (diZerega 2015, p. 19). the components of an ongoing system, in which varying A highly functional civil society correlates well with the degrees of structuring arise, persist, dissolve, or change” realisation of individual liberty since it allows for the great- (Ibid.) helps us appreciate the evolutionary dynamic of est range and depth of unforced cooperation between non- structural phenomena pervading civil society. Further still, intimates possible. Not only can individuals respond, or not even though the “continuous morphogenic process” (Ibid.) respond, to certain feedback signals; they are free to act in of civil society is not wholly reducible to individual action, a “modular” fashion, and by that I mean they can associate classical liberals are deeply abiding methodological indi- and dissociate with others without fear of being shunned, vidualists who appreciate the pivotal role that individuals or punished in some other manner (Gellner [1925] 1994). play in shaping the trajectory of orders posited within civil There is no single focal point in civil society as individu- society.
Civil Society as a Complex Adaptive Phenomenon - - - - - . - adinfinitum What emanates from this process, complex given that would themselves simply reproduce Interactionthat give but may novelty rise novelty, to must be recognized and acted individuals by upon to anyhave lasting effect. Movingfrom the initial phasea given of individual or see b; also Isabel 2017a, Almudi and colleagues (2017, It is a truismIt that living in a civil society enables us to 141): p. According Martin to (2011, the possibility [w]ithout individual of entrepreneurs conceiving new ways doing of of things, dissent ing from existing social structures, those structures contributions toward promoting their generates a utopia contestable exchange ideas, of in which constantly people accept reject or of offers alternativeorganising principles civilfor society. an idea emerges,“once can it variations generate around the original prior 632) p. (Almudi conception” et. al., 2017a, and that individuals can alter their resource contributions agencysociallya (i.e. organised rule carrier, such as for- a or charity, profit firm,politicalnon-profit party) partaking in entrepreneurial activity can, we then, conceptualise the economic,successive social a novel of adoption political or rule a population by as the second phase an of evolutionary trajectoryramifying throughout civil society et. al. (Dopfer 2004; and Potts Dopfer 2008). developed model a propagation have 2016) Markey-Towler in which openly people contribute economic resources to ward supporting their ideological preferred position (or with respect “utopia”) civil to liberty, culture, environmen tal amenity, and the scope market of and state action. For Almudi and colleagues societal transformation, running ideasfrom corresponding to novel changes in social struc tures, is centred actors upon drawing their upon resources (effort, time, money other and to convinceresources) others acceptto their utopia. The preferred disparityof individual modularly adjust ourselves seek to greater alignment with our fellows, the but fact that entrepreneurship oftentimes arouses controversy implies that novelty often elicits a modicum discomfort of and resistance among those who bear the costs and fatigues adjustmentof and readjustment. Thisapplies to successful entrepreneurialventures eco into nomic,social and political unknowns. less Other, success ful proposals inject to novelty insufficient endure profits, esteemgain votesto or critical footholda of mass in civil society. ------for human for there been musthave modus operandi Even beforeEven then from, rather than consensus with, con dissensus It should be recognisedIt that acts entrepreneurship, of Entrepreneurialbe need conduct understood not merely Exchange in the sense described entails here a regime of The The adaptive potentialof civil society, as actpeople and commodates and discoordinates as as coordinates. much it context entrepreneurial action, borne “the of unpredict able, the creative, the imaginative expressions the of human mind” frustrates (Kirzner 147), as as p. 1982, ac much it and values are subscribed interacting by to individuals— what Richard calls Wagner the “social tectonics” discord of asemerge very real features our of shared existence. In this an act of ventional ways being, of doing and knowing Inrules). (i.e. civil society—within which a multiplex beliefs, of interests and political trajectories, order respectively. prevalent in whichever civil of order society, represents theconcepts economic entrepreneurship, of social entrepre neurship and political entrepreneurship as the initial injec withintions novelty emergent of the economic, communal Koppl (2006, pp. 1-2) pointedly states, “[e]ntrepreneurship pointedly states, “[e]ntrepreneurship (2006, 1-2) Koppl pp. is an aspect all of human action. Entrepreneurship is a hu man universal,” and our purpose for can we roughly map but, in fact, as an aspect generalised of human conduct inpresent all societies across time and space (Boettke and Coyne 2009; 2006; Koppl and Minniti Koppl As 2008). change. in its economic well-known, incarnation yet exclusively, civil society. These people are what are “entrepre known as andneurs,” they are widely recognisedtheir for pivotal role in propelling processes economic, of social and political people sufficientlypeople mentallyalert and socially op adept to portunities thatenhance their position, and that others, of in ways that fortuitously exchanging render activity within there needs be to a given party, parties, or that to reach out the other party, parties, or with the aspiration initiating of thegiven exchange. mutually beneficial cooperation involving people. That said, interaction in market and (including non-market political settings) (Buchanan 2005; also Alvey 2009 and Garnett Jr. 2011). successionadvantages, of unceasingly all for renewed its recently more James Much Buchananmembers.” valorised the exchange paradigm as the French philosopher Destutt de Tracy ([1817] 2001, p. 95) ob 95) p. 2001, philosopherFrench Destutt ([1817] de Tracy served is purely and that a continual solely “[s]ociety series exchanges.of … consequently society is an uninterrupted react noveltyto and other guises change, of has been long recognised in the liberal canon. The nineteenth-century VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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toward those multiple causes, is essentially a meso-level heart of John Stuart Mill’s defence of liberal civil society, population of tenuously cohabitating ideas about how to as outlined in his famous tract On Liberty. As for political live. According to Almudi and her colleagues their model, activities, political institutions (e.g., one-vote-one-value for incidentally, seems to describe certain features of socio- all adults, open and contestable elections) which effectively economic-political change in the United States reasonably treat individuals as intelligent, deliberating equals, and not well. as objects of domination and subjection, are more likely to We have moved from the origination phase of entrepre- generate outcomes perceived as reflective of the public (in- neurial action, embodying typically novel and sometimes stead of special) interest. useful but almost always unsettling values, to a depiction Institutions come about when origination of a novel pro- of a diffusion process whereby different ideas, interests posal leads to willing adoption by large segments of the and values are championed by varied groups and accom- population which then persists through time. Institutions modated in a modus vivendi of an ongoing, albeit peaceful, can be so successful that they exert what Lewis (2012) calls struggle for prominence. Finally, I turn my attention to the a “downward causal influence” shaping attitudes, disposi- final phase of change within civil society, centred upon the tions, interests and values in that most people routinely perpetuation, or stabilisation, of certain values into rule- follow them, and indeed epitomise the enduring representa- systems that are commonly called “institutions” (Dopfer et. tions of social reality we call “culture.” By the same token, al. 2004; Potts 2013). however, institutions themselves are not immune to chal- Numerous definitions of institutions abound, though lenge and change if there are insufficient incentives to jus- one which seems reasonably representative is as follows: tify their reproduction through time. In those instances we “Institutions are the humanly devised constraints that observe the processes of origination and adaptation of pro- structure political, economic, and social interaction” posed, and actual, amendments of incumbent rule-systems 9 (North 1991, p. 97). This definition encompasses informal at play within the various orders of civil society. customs, mores and norms through to formal legislative What has been offered here is a meso-centric narrative edicts by the state. of change to the structured (and entangled) interactions An inherent value of institutions is that they provide fo- between persons along economic, communal and politi- cal points of orientation for individual planning that, in- cal dimensions. It is from this perspective that we see that COSMOS + TAXIS + TAXIS COSMOS cidentally, helps to ease problems of inter-subjectivity by “social selection and relative stabilization or institutional- bringing expectations of one another’s plans and intentions ization of normatively interpreted role relations and value into better alignment, thereby reducing inconsistencies and patterns occurs through the variety of processes usually conflicts (Martin 2011). Similarly, institutions shape the studied under the headings of conflict, competition, accom- relative payoffs associated with conducting entrepreneurial modation, and such; power, authority and compliance; and activities in ways which either advantage, or disadvantage, “collective behavior,” from mob behavior through opinion other people. formation processes and social movements to organized Institutions which facilitate trust between strangers and war” (Buckley 1968, p. 495). do not unduly interfere with the free adjustment of econom- Contestation over different ways to organise human af- ic feedback mechanisms of relative prices, several property fairs doubtlessly creates many avenues for disagreement be- and profit-and-loss mechanisms will encourage economic tween individuals and groups, depending upon the issues entrepreneurs to strive against each other to offer up a mul- at stake. While there are always tensions within and across titude of “preferred utopias” in the form of improvements economic, communal and political orders of interaction, to the existing production techniques and trading possibili- not least because of the fact that the incentive structures ties. and value sets redounding in civil society are often incom- Similarly, institutions can also facilitate cooperative so- mensurable if not outright incompatible, it is nonetheless cial and political endeavours. Rules maintaining an ease eminently possible for one to discover and achieve mutu- of entry to, and exit from, existing associations within the ally agreeable exchanges with other people. This has long communal order, and tolerance for the creation of new, been demonstrated in the form of the “Great Enrichment” hitherto unknown bodies and groups of like-minded per- of market-tested betterment (McCloskey 2010) and other sons can facilitate the peaceful co-existence of the conven- manifestations of human progress (Norberg 2016). tional and the non-conventional. This insight was at the
Civil Society as a Complex Adaptive Phenomenon ------of unre Gesellschaft of intimate of personal and Gemeinschaft I suggest that survival in an evolutionary sense depends Other accounts expressing a fear civil-societal of decline Scholars in the communitarian tradition expressed have ideas and behaviors withrespect the to tradition al, institutionalized ideologiesand behaviors. role Rigidificationof any given institutional structure must eventually lead disruption to dissolution or of the society internal of way by upheaval ineffective or nessagainst external challenge. The classical liberalFriedrich famously Hayek suggested ture, whereas the critics “neo-liberalism” of suggest that privatisation and deregulation reforms signal a disturb ing retrenchment the of political communal) (and from human affairs. On other the hand, classical liberals view governmental activity as threatening the displacement, or those activities of,” out “crowding voluntarily undertaken within people by market and civic associational contexts. not so much upon institutional upon so much not persistence, which unques tionably can matter greatly under certain conditions, but a capacityupon institutions of adapt to and change, and to accommodate discoveries and challenges prevailing to dis positions, inclinations andvalues. Indeed, “[e]volutionary modelsneed… incorporate to meansa change of in order and, so, pur 231), 1994, p. [1982] (Vaughn be to complete” posive human action should generally be viewed as both a fundamentalfeature and lifewelcome of incivil society and the within orders it. reflect concerns that non-permeability the of spontane withinous orders civil society lead the to may workings of a given being in order thus inordinately, inappropriately, by paradigmsfluenced and valuesfeedback(perhaps even mechanisms) widely perceived be to alien this it. to From standpoint the inherent diversity human of existence evi indent civil society dissipate may as the logics a given of dominateorder the logics others. of the view that the familial tiesare tested sorely the by pentantly commodifying markets an of impersonal na thatadopted and people retained institutions which were the to conducive perpetuationmore and flourishingof the human species, whereas those adopted less who effective in stitutions cast were aside into irrelevance oblivion. or Some made thehave suggestion that the certain of retention tra ditional ways living of are necessary ensure to our survival, and indeed writings Hayek’s cultural on are evolution often interpreted in this conservative fashion. ------in - com ad hoc accommodating an ensemble of
[a] requisite sociocultural of [a] systems is the develop and maintenancement a significant of non- of level pathological deviance manifest as a pool alternate of We should remind ourselvesWe that civil society is a There is no doubt doubt no There is that the kindsof associations grafted Those concerned with deteriorating civil society point tionality and viability civil of society. As p. Buckley (1968, stated:495) number. Variety andnumber. change is the at the of core ways in which humans mingle, and these characteristics are not necessarily from problematic the perspective the of func plex and adaptive process variousspontaneous which, orders in turn, facilitateinter actionsand preferential attachmentsa mind-boggling of times. To suggest, however, this suggest,times. implies however, civil To society in its entirety is fraying weakening or is questionable. society. within civil society waxed have and waned in modern and participation in, numerous associations declin were ing therefore suggests generic deterioration in the stock of social capital, in turn threatening the functionality civil of tively together pitch without resolve common to problems recourse the to likes stateof action and other distant, top- down interventions.observation The membership that of, cialcapital within civil society generally. greaterA more social capital stock is associated with greater levels trust of and mutual respect, enabling communities effec more to out the active in people out of more a variety involvement as of sociations in the past was only not indicative a vibrant of tended strengthen to communal but order, the so level of these groups is newer somewhat of fleeting and nature Skocpol 1998; (Wuthnow 2004). edge the heightened interest in environmental concerns, and a growing affinitywith feminist, racialqueer and civil rights groups, they also suggest levels commitment of to nal organisations, labour unions and religious orders, and declining voluntarism within and clubs societies (Putnam 2000). Although1995, many these of studies acknowl do form of “decay,” have proliferated have in both “decay,” form of academic and popular literature. This has beenreflected in studiespoint ing falling to membershiprates groups suchof as frater Inarguments decades, recent if longer, the to not effect that civil society is in a state “decline,” of gripped or some by REFLECTIONS ON THE “CIVIL SOCIETY IN IN SOCIETY ON THE “CIVIL REFLECTIONS NARRATIVE DECLINE” VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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Richard Wagner advises us that the “structured living- the right to be different. Difference is the elemental driver togetherness” that embodies civil society is exemplified by of economic evolution, and societies that are tolerant of dif- entangled human interactions which can criss-cross the ferent ideas and rules carried by micro agents possess a nec- economic, communal and political orders, and to some essary condition for economic evolution (Dopfer and Potts extent entanglement is unavoidable. Even so, he raises the 2008, p. 98). issue that growing political influence in economic decision- By contrast, persistently hierarchical and monopolistic making not only induces “rent seeking” behaviour, in which relationships in any of the orders of civil society has the po- entrepreneurs attempt to extract special fiscal and regula- tential to fatally compromise those senses of equality, open- tory advantages and privileges from government, but mixes ness and toleration upon which we all rely to have decent private and public ordering principles in such a way as to opportunities to strike arrangements with others for mu- generate calculational problems corrupting the political tual benefit. Indeed, a renewed appreciation of such lessons economy. One could extend such insights to describe, for could prove most valuable in a time in which the pressure example, the problems surrounding the displacement of points of market concentration, social strife and political polycentrically situated civil associations, such as mutual authoritarianism appear to be looming larger across devel- aid societies, by a massive, yet increasingly paternalistic and oped countries, perhaps risking our capability to live freely fiscally unaffordable, government welfare state. and peacefully with one another. A group of mid-twentieth century liberal scholars, main- ly from Germany, acknowledged the fuzzy boundaries be- CONCLUSION tween spontaneous orders embedded within civil society but, nonetheless, sought to enumerate policies and institu- No truer words were expressed than by Gus DiZerega when tional rules to ensure that the scope of entangled relations he reckoned the cosmos of civil society is that realm of indi- 11 delicately remain within reasonable bounds, and without vidual choices across a broad range of different values con- losing the dynamic propensities within civil society that sistent with peace with others (DiZerega 2015, p. 20). I can yield widespread benefits (Stützel et. al. 1982; Peacock and be atheist, queer, a hobby astronomer, an economist and a Willgerodt 1989a, b). classical liberal all at once. Similarly, I can ignore calls to The “ordoliberals,” as they were labelled, saw the mainte- prayer; disparage pleas to privilege one race, gender and na- COSMOS + TAXIS + TAXIS COSMOS nance of civil society as resting upon a “constitutional culti- tionality over another; and critique demands to nationalise vation” of sorts—rules should maintain an economic order the economy at the same time. Many other members of civil featuring open, competitive markets and whittle away mo- society may not endorse my opinions and how I live my life, nopolies that harm consumers’ interests; rules should en- and I needn’t necessarily endorse theirs, but we maintain courage the development of vibrant, local communities but détente as we strive to paint our unique stories onto the not concentrate social power in overbearing hierarchies; canvass of life. and rules should constrain political action in accordance The ability of different people to indulge in their choic- with the rule of law, and preferably enshrine polycentric es—individually and among persons, as well as over time, activity in line with subsidiarity principles. Dopfer and is instrumental to human flourishing, but choice-fulfilment Potts (2008) offer a modern reinterpretation of key ordo- often requires mutual assistance. People invariably engage liberal doctrines for maintaining fruitful interdependence with others to transform resources and earn money; to give between civil society’s orders: and receive love and emotional and other supports; and to An open market economy in which agents are not just persuade others to gain political credibility and influence. operationally free to choose the commodities they will For many classical liberal theorists the “variety of situa- consume, but also generically free to choose the knowl- tions” (to paraphrase Wilhelm von Humboldt) arising from edge they will adopt, ultimately rests upon a social, political the varied orders comprising civil society serves as a very and cultural order in which variety is sustainable. Generic foundation for the realisation of freedom itself. openness therefore fundamentally requires tolerance of Civil society represents that ingenious admixture of novel ideas as a primary condition, and only excitement evolving cooperative and competitive relationships, always about novel ideas as an accelerant. Such tolerance may well peaceful and abhorring those techniques which privilege be constitutionally embedded in, for example, freedom of certain activities (indeed, certain individuals) above oth- speech laws or other legislation that affords and protects ers on the basis of group identity or some other status. The
Civil Society as a Complex Adaptive Phenomenon . Journal
Economics . 63 (4): 755-782. . 63 (4): The Oxford . 16 (2): 173-197. (2): . 16 . 82: 368-378. . Chicago: University . 25 (2): 2-4. . 25 (2): New Individualist Hayek, Mill, and the Comparative Economic Comparative . Lexington: Lexington Books, . 2 (1): 48-62. . 2 (1): Studies in Philosophy, Politics and . 3 (1): 17-37. . 3 (1): The ReviewPolitics of The General Theory of Economic Economic Affairs 14: 263-279. . 4: 170-192. . 1: 1-23. . 1: . New York: Oxford. New York: University Press, pp. The Independent Review Independent The Conditions of Liberty: Civil Society and its Method, Process, and Austrian Economics: . London: Routledge, 177-194. pp. Entrepreneurship: The Engine of Growth—Volume . London: Taylor & Francis,. London: Taylor 148-162. pp. Cosmos + Taxis Cosmos + Taxis . Chicago: University Chicago of Press, 66-81. pp. Individualism Economic Order and . London: Routledge. . Praeger Perspectives Series. Westport: Greenwood . 28: 1-19. . 3 (2): 3-12. . 3 (2): . New York: Penguin. New York: Books. Action. In: Shockley, G. E., Frank, M. and Stough, P. R. R. (eds.) Non-Market Entrepreneurship: Interdisciplinary Approaches Cheltenham: Edward Elgar, 10-27. pp. Conveyance Inarticulate of Knowledge. Studies Studies in Emergent Order Economic BehaviorJournal of Organization and https://www.fff.org/explore-freedom/article/individual-liberty- civil-society/. Accessed 9 August 2017. Necessarily Contested Idea. In: Edwards, M. (ed.) Handbook of Civil Society 480-491. taken.road not (yet) In: Farrant, A. (ed.) Tradition Liberal Rivals A. (ed.) F. Chicagoof Press, 77-91. pp. Review Conduct. In: A. Hayek, (ed.) F. Economics study the of entrepreneurial profile in the Misesian system. In: Kirzner, I. M. (ed.) Essays in Honor of Ludwig von Mises pp. 139-159. Minniti, M. (ed.) 1: People Publishing, 1-20. pp. the Unity Liberal of Politics. Studies in Emergent Order Relation to Democracy. and Capitalism. SideTaxis. of Economics Evolutionary of Evolution and Ends Philanthropy. of (With Apologies to Paul Ricoeur). In: Lavoie, (ed.) D. Hermeneuticsand Lavoie, 1986. D. The Market a as Procedure for Discovery and VarietiesLewis, Emergence: of 2011. Minds, P. Markets and Novelty. Lewis, 2012. Emergent Properties P. in Friedrich of the Work Hayek. Edwards, Conclusion: M. Civil 2011. Society as a Necessary and Garnett Hayek and philanthropy: 2011. R. Jr., F. a classical liberal 1994.Gellner, E. [1925] 1948.Use The of Hayek.Knowledge A. [1945] F. in Society. In Hayek, A.Hayek, 1964. F. Kinds Order of in Society. Notes the on A. EvolutionHayek, Systems of 1967. F. Rules of of Kirzner, I. M. 1982. Uncertainty, discovery, and human action: A Koppl, R. 2006. Entrepreneurial Behavior as a Human Universal. In: Koppl, R. and Minniti, M. 2008. Entrepreneurship and Human diZerega, G. 2001. Liberalism, Democracy and the State: Reclaiming diZerega, G. 2008. New Directions in Emergent Order Research. diZerega, Spontaneous G. 2011. Order and Liberalism’s Complex diZerega, Paradoxes G. 2014. Freedom: of Civil Society, the Market, diZerega, Simply Not G. Construction: 2015. Exploring the Darker K., J. andDopfer, Foster, Potts, J. 2004. Micro-meso-macro. K. andDopfer, Potts,J. 2008. Ealy, L. 2005.Philanthropic The Enterprise: Reassessing Meansthe Ebeling, R. What M. is 1991. a Price? Explanation and Understanding Ebeling, R. M. Individual 1993. Liberty and Civil Society. - -
. . Critical . 19 (1): 165-185. (1): . 19 . Revised Edition. . 21: 151-166. . 21: . 4 (1): 23-34. . 4 (1): , Volume 1, Indianapolis: 1, , Volume The OxfordHandbook of Journal of Evolutionary Evolutionary Journal of . 5 (3): 4-17. . 5 (3): Cosmos + Taxis Why I, Too, Am Not a ConservativeWhy I, Too, Journal of BioeconomicsJournal of . Chicago: Aldine Publishing Company, pp. Reclaiming the American Dream: The Role of Modern Systems Research for the Behavioral Foundations and Trends in Entrepreneurship in Foundations Trends and Review Austrian of Economics Living Economics: and Today, Yesterday, Journal of DemocracyJournal of . 6 (1): 1-10. . 6 (1): The LogicalFoundations of ConstitutionalLiberty: The . Oxford: Oxford University Press, 443-463. pp. . 27 (4): 629-662. (4): . 27 . Oakland: Independent Institute and Universidad . 3 (2): 206-240.. 3 (2):
agree more than on price? a Consolidation. Review learning in non-priced environments: An Austrian view social of network theory. Critical Review AssociationsPrivate Individuals Voluntary and New Brunswick: Transaction Publishers. order. In:order. Buchanan, J. M. Cheltenham: Edward Elgar, 72-85. pp. (ed.) F. Buckley, W. Scientist: Sourcebook A 490-513. J., Paganelli, and Smith, M. P. C. (eds.) Adam Smith Markets. In: Collected Works of James M. Buchanan Liberty Fund, 89-102. pp. Economics and Finance Discussion Paper 09.04. No. Tomorrow Marroquin.Francisco Entrepreneurship. 135-209. 5 (3): Economics competition: a new approach to the microfoundations of sustainability transitions. Exchange and Gains from in Trade All Aspects Life, of including Markets and Politics. Massey University Department of The economicsutopia:of a co-evolutionary modelideas,of citizenship and sociopolitical change. Diamond, L. J. 1994. Rethinking Civil Society: Democratic Toward diZerega, Democracy G. 1989. as a spontaneous order. Dekker, E. and Kuchař, P. 2017. Emergent OrdersDekker, Worth: of Must E. we 2017. and Kuchař, P. Cornuelle, R. C. 1992. The power and povertyof libertarian thought. Cornuelle, R. C. 1993. Chamlee-Wright, E. and Myers, J. A. 2008. Discovery and social Buckley, W. F. 1968. Society F. Buckley, W. as a complex adaptivesystem. In: Buchanan, J. M. 2005. The senseof community in Hayekian moral Buchanan, Social 1999. J. M. Choice, [1954] Democracy, and Free Boyd, R. Adam 2013. Smith, Civility, and Civil Society. In: Barry, C. Boettke, J. and Coyne, P. C. J. 2009. Context Matters: Institutions and Boettke, J. 2012. P. Almudi, I., Fatas-Villafranca, and Potts, F. Utopia J. 2017b. Alvey, J. E. 2009. TheFoundations Jamesof Work: Buchanan’s REFERENCES Almudi, I., Fatas-Villafranca, Izquierdo, F., L. R. and Potts, J. 2017a. tuallybeneficial economic, social and political changesto gether. well maintained, without extirpating individual liberties, thechances are civil society willcontinue serve to as that indispensablearena in which accommodate to look we mu twin-marvelscivil of society concern its accommodation humanof diversity and its evolutionary the attributes. To extent which to these qualities are diligently and vigilantly VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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Madison, G. B. 1997. The Political Economy of Civil Society and Human Rights. London: Routledge. Markey-Towler, B. 2016. Ars rhetorica et cogitationes publicae, or The competition and evolution of ideas in the public sphere.
Civil Society as a Complex Adaptive Phenomenon - - - - ). It is a complement is a complement It ). ) and the flexible space cosmos taxis The The main thesis is that flexible the for space spontaneity The The conceptsflexibilityof and spontaneity—whichare This article investigates relationship the betweenplan to Jacobs’ works,to which focused mainly the on relationship betweenthe physical and socialdimensions in economics 2000), whereas 1970, and urban (Jacobs 1961, development addsit the relationship between the physical and regulatory dimensions (Cozzolino 2017). configurationsand emergent does on dependnot solely the physical dimension the of built environment is ob (which so on; seesoon; Alfasi et Buitelaar al.Gadanho 2013; etal. 2014; and and developments changes) Spontaneity (of et al. 2014). flexibilityplans, (of rules, policies are on) indicatedand so as valuable alternatives orthodox to planning practices. two key features Jacobs’ ideas—have of become widely used experts;by clarifications however, needed are to underscore the different ways in which work they under different kinds of planning conditions (Moroni and Cozzolino, forthcom ing)—being such conditions material (like buildings, open spaces infrastructures), or immaterial or (like buildings codes land-use or plans). ning view, Hayek’s (in control spontaneousfor left actions and of emergent the evolution socio-spatial configurations(i.e., ------Spontaneity, flexibility,Spontaneity, configuration, emergent planningconditions, planning,land-use rules, Jacobs.Jane : AfterJacobs’ seminalworks, idea one seems to be widely sharedplanners:by citiesmust be considered as complex
predictions (e.g., organicpredictions planning, (e.g., tactical urbanism, and idea is driving the planning system towards an unequivo cal shift from the comprehensive-technocraticto approach strategicmore plans, less connected top-down long-term, to evolution of socio-spatial of evolution configurations a play crucial role (Batty Bertaud 2007; 2004; de Roo et al. Holcombe 2012; Holland Lai 2012; 1995; an Such 2004; Portugali 2011). to beto largely shared experts; by cities be should consid not planableered simple objects as but self-organizing and com in ones plex which spontaneous actions and the emergent it isit possible spontaneity—and enable to many differentap more theproaches on are table now (Rauws 2017)—today, than sixty years afterJacobs’ seminalidea one seems work, persed knowledge ordinary of (Callahan people and Ikeda Moroni Ikeda 2012; Gordon 2017; Cozzolino2014; 2017; Despite planners agreenot do in the2016). ways in which more themore city is planned, controlled and designed from the thetop, less flexible space spontaneous for is there adapta tions and connected improvements, the to use the of dis Jane Jacobs (1961) argues that the city system is a complex Jane Jacobs (1961) possessing charactersemergent that are the result place- of based processes self-organization. of sustains She that the 1. INTRODUCTION Keywords: nent role played by the by played rules role nent the over built-environment in defining flexible the forsocio- emergent space of the evolution spatial configurations. are now indicatedare now as valuable alternatives orthodox to planning comprehensive practices. The article discusses the different ways in which spontaneity and flexibility work under different planningkinds of conditions (beingmaterial, like buildings, open spaces infrastructures, or immaterial, or like building codes In land-use particular, or plans). recognizes it the preemi Abstract self-organizing systems. In the planning field thisidea hasopened to door conceptsthe like spontaneity flexibility and which Germany Email: [email protected] https://ils-forschung.academia.edu/StefanoCozzolino Web: ILS – Research Institute of Regional and Urban Development and Urban Development Regional of Institute – Research ILS 6 Karmeliterstraße Aachen How do they work under different kinds of planning conditions? planning conditions? kinds of under different work do they How COZZOLINO STEFANO Reconsidering Urban Spontaneity and Flexibility after Jane Jacobs: Jacobs: Jane after and Flexibility Spontaneity Urban Reconsidering VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
COSMOS + TAXIS 14 COSMOS + TAXIS
viously a key aspect), but also—and even mostly—on the ous actions and emergent configurations. With the term way in which planning rules are written and provided (Ben- spontaneous, it refers to intentional actions developed by Joseph et al. 2005; Kim et al. 2016; Talen 2016). In other self-determining and intentional agents, (e.g., landowners, words, the degree of spontaneity and flexibility depends, in developers, householders, etc.), whilst the term emergent re- different ways, upon both social and physical conditions. fers to the unplanned social-spatial aggregation that is the The article explores why the relationship between spon- (unintended) result of uncoordinated actions and interac- taneity and planning conditions is multi-layered and hi- tions. In other words, the article differentiates voluntary ac- erarchical, recognizing the preeminent role played by the tions, (which can be undertaken by an individual or a group rules over the built-environment. It discusses this ques- of individuals acting in cooperation; see Mises 1963/1998), tion without having the ambition to investigate in detail from evolving situations, that are the result of many, unac- many relevant side-related issues—already well-discussed countable actions interacting over time (Schelling, 1978). by other scholars—such as indicating which planning ap- The term spontaneous derives from the Latin word proaches are more suitable to welcome spontaneity (Alfasi spontanĕus which means “of one’s free will”. In general, the and Portugali 2007; Andersson 2014; Buitelaar et al. 2014; word describes persons and characters with a sense of “act- Moroni 2015; Totry-Fakhoury and Alfasi 2017), analysing ing of one’s accord” or “occurring without external pres- the effects of planning interventions in economics (Bertaud sure”. Hence, we can think of the word “spontaneity” as a 2014; Gleaser 2011; Pennington 2002; Webster and Lai particular quality of actions (Beito et al. 2002), whereas, the 2003), or discussing the main aesthetical issues linked to concept of emergent configuration means any (socio-spatial) spontaneous developments (Alexander 1967; Hakim 2014; configuration that is the result, over time, of a countless Nilufer 2004; Romano 2010). Each of these issues would de- number of actions, but not a direct consequence of a single serve a specific article. This is an attempt to demonstrate, action or design (Hayek 1960; Polanyi 1951). Configurations 15 from a Jacobsian perspective, the reasons why rules matter, of this kind are detectable in any system composed of a at least as much as the built environment, in defining the multitude of agents who pursue different plans and separate flexible space for spontaneous actions and the development actions. The highest expression is observable in and within of unpredictable changes from the bottom-up. the city (Holland 1995, p. 41). Beyond the introduction, the article is divided into four The main arguments for the evolution of emergent con- COSMOS + TAXIS + TAXIS COSMOS other sections: three of them answer the following ques- figurations lie in the possibility of adapting, over time, the tions; (section 2) “What do you mean by spontaneity and physical and social world in ways that none could predict in emergent configurations and why are they relevant?”; (sec- advance, leaving to the system the opportunity of efficiently tion 3) “How does spontaneity work within the urban fab- reacting to various contextual needs, and the possibility ric?”; (section 4) “How does spontaneity work within the of making more efficient use of the so-calleddispersed rules?”. The article ends by providing general conclusions knowledge (Hayek 1945 and 1960). Emergent configura- and devices (section 5). tions, however, are not synonymous with chaos or disorder, but they are a series of stable (but evolving) patterns which 2. WHAT DO WE MEAN BY SPONTANEITY are not defined through central coordination. On the one AND EMERGENT CONFIGURATIONS AND hand, emergent configurations enable social interaction WHY ARE THEY RELEVANT? and the self-coordination of systems; on the other, they structure the character and peculiarities of specific places. Before getting to the heart of the matter, some termino- Their evolution is open-ended (i.e., unpredictable and un- logical clarifications are needed. First of all, the termaction certain), but path-dependent. (see, for instance, Carter 1999; Cody 1967) is contextualized However, to recognize the relevance of emergent con- to the field of urban planning and, therefore, it may repre- figurations doesn’t necessarily mean to be in favour, of an- sent certain general types of (urban) actions, like the act of archism, or laissez-faire, but to appreciate the intrinsic and building or using a certain amount of space, or other an- instrumental values of spontaneous actions in the func- cillary actions, helpful for pursuing them, (e.g., obtaining tioning city. All this without being against the presence of loans, signing agreements and covenants, etc.). Secondly, good planning rules (Moroni 2010). Firstly, spontaneity is in order to differentiate between two different kinds of good in itself, at the level of the individual, because it allows phenomena, the article distinguishes between spontane- people to pursue their own ends by means of their knowl-
Reconsidering Urban Spontaneity and Flexibility after Jane Jacobs: How do they work under different kinds of planning conditions? ------(Ikeda 2017). and its detail; level of the second regards the A firstto design way newresidential the area be may that In the second case, could it be that the architect does not further. go Let’s Suppose that the the of architect work is be increased. In fact, can we imagine that, in addition the to design open public spaces, of buildings and their internal divisions and functions, the architect also may decide de to sign, in a unified detailedand the interior way, furnishings. thisAt point, only a little flexible spacewould remain for self-determining spontaneous actions and the use dis of persed knowledge future of inhabitants. ent ways,ent with variable levels scale of and detail. dem To onstrate that, address may we the issue moving from a first design, that guarantees a high degree flexibility,of one to in which the flexible space is narroweddown nearly and can celled. draw to solely of the open public spaces, and then leave open, other to architects, builders and inhabitants, the pos sibility defining of and fillingthe grain ofthe area. Such could accordingdevelopments emerge a succession to of spontaneous actions, constrained the by open presence of instance,public spaces (for roads, green areas and so on) and certain planning rules. design only the open public spaces, also but the size, the footprintsall of the buildings and also their physical rela tionships. The differences betweenthe firstapproaches two are remarkable. only not limited the to design the of open public spaces and the footprints all of the buildings, also she or he but decides determineto their interior subdivisions, as well as their functions. this At point, the design will begin assume to a very rigid its detail level of character. However, could still effects of all actionsthe changesand outside. that happen As regards the physical dimension the of built environment, two important factors are worth considering: the first is the scale of design passage time of The scaledesignof itsdetailof level and The firstimplication is easilyunderstood: the higherthe the levelof detail provided particular a by plan, projector theless will be the flexible spacespontaneousfor actions and unexpected future emergent arrangements. Moreover, the greater the scale design of that is subjected a unitary to plan, the greater will be the amount space, of subject the to that of control specificplan. example:For imagine a uni tary designed residential area whichincludes a hundred condominiums. Architects could face this design in differ
------of of the of work of ar the socialthe dimension the material dimension is that, with the passage time, of (potentially) it So, we cannot So,we think the of city as fullya emergent
HOW DOES SPONTANEITY WORK WITHIN WITHIN WORK SPONTANEITY DOES HOW FABRIC? THE URBAN
Jacobs highlights that any physical that element has been As already argued, two different typesplanningof condi The The city is irremediably both planningproductof the predictable) actionspredictable) occur inside; undergoes it secondly, the startsdifferentiate to itself its from initial design it is and This subject reinterpretation to Easterly (Brand 2015). 2010; process two happensfor mainreasons: firstof (un all, some degreeflexibility, of depending upon both internal ex and ternal factors. In fact, a common feature any of chitecture tions. deliberately designed and built always provides a certain amines the relationship between the design the of physical thespace intentionally (i.e., and created spatial its order), flexibilitylevel of configura for of emergent the evolution This section examines the issueof spontaneity within the dimension the of built environment (Bergevoet et al. 2016; Manewa In particular, et al. 2009; ex it Roggema 2014). 3. space for the evolution of emergent configurations space the emergent for of evolution and the ways in which spontaneity can be manifested less. or rules. speak we may Therefore, of two trade-offs:the first has a spatial dimension; the second has a regulative dimen Bothsion. levels, in different ways, influence the flexible tions constrain tions spontaneity: built physical environment (i.e., objects, such as condomin iums, streets, parks and and so on), spatial infinite of a world over control possible becoming (Ikeda 2017). works as a trade-off betweenplanning conditions and the space self-determining for spontaneous (unpredictable) actions, the where introduces former a certain degree of a spatial and social configuration reach that may different degrees overall of spontaneity This (Buitelaar et al. 2014). ders, and configurations the emergent of evolution (Bertaud 2004). configurationbut,it to is seeit appropriate rather as more forces (Ikedaforces 2004). interventions, which introduce artificially constructedor and innovation otherwise unachievable under a state ex of tensive overall control, developing self-organizing systems in which society can make efficient ofpolycentric more use edge and creativity, also experimenting with new solutions and actions. Second, from continuous processes trial of and societyerror, can get benefitsreaching progressof level a VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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In brief, the implications of the scale and detail of design 4. HOW DOES SPONTANEITY WORK regards designers’ intentions to impose a particular spatial WITHIN THE RULES? order, which, in its turn, may be more or less extended and accommodate more or less flexibility. To better comprehend Now we look at the built environment and the flexible space it, we can think of highly planned cities like Brasilia, or for the evolution of emergent configurations deriving from the Chinese “ghost city”, or the typical neighbourhoods of the presence of planning rules.2 The general idea is to un- the Soviet era (Hirt 2013; Ikeda 2017; Zarecor et al. 2012) derstand the relationship between the physical environ- as relevant examples of large scale design with a high level ment, (planning) rules and the flexible space for actions of detail of the built environment. On the contrary, in the that can alter the pre-existing urban structure, bringing it case of a high degree of flexibility, for instance, we can refer into an adapted state of affairs. to forms of organic developments diffused in the last years What has been pointed out in the previous section is in the Netherlands (Cozzolino et al. 2017; Oosterma et al. fundamental to the following discussion. However, further 2015; Rauws & de Roo 2016).1 observations must be set as crucial pre-conditions for any agents’ actions. In fact, more than the physical space in it- The passage of time self, what primarily influences agents’ actions space (Ikeda The second implication regards the passage of time. 2007) within the built environment are the rules (Moroni Whatever the scale and detail of the design, its (imposed) 2015). To show this, we go through three comparative em- order will not remain stable over time; rather, it will be sub- pirical examples which describe imaginary spatial differ- ject to processes of emergent adaptations and adjustments. entiation processes, showing why the rules (more than the Once constructions are realized, they start to be exposed to design of the space itself) are the prior condition for the constant stress and actions (both internal and external). So, adaptation of the physical space. This statement is not an at- 17 with the passage of time, all that is designed will be sub- tempt to diminish the importance of the design of the phys- ject to (more or less) certain alterations that designers could ical space (which is obviously a fundamental condition);3 not foresee in advance (as none of us can today perfectly rather, it is an attempt to distinguish two different levels of foresee the evolution of social needs and changes in the the discourse in which rules become the meta-condition, next decades). Every urban element, even the least adapt- whilst the built environment is the material concretization COSMOS + TAXIS + TAXIS COSMOS able, tends to undergo (with different dynamics) uninten- of actions that, in their turn, are always conditioned by cer- tional progressive adaptations. This process occurs since it tain rules. is impossible to think of an urban element (for instance one The first two examples compare two initially identical -ur building) as an isolated element; rather, we should think ban settlements but with different rules. The third example of a single urban element as part of a complex interrelated shows that it is not so much the initial design that deter- whole (Jacobs 1961). Moreover, how people demand space mines, in absolute terms, the flexible space for the evolution to be used or built is unpredictable in a world of imperfect of new emergent configurations, (i.e., it is not important so knowledge. much to know if the city, or part of it, evolved spontaneously A valuable example is offered by Jane Jacobs (1961, or not); rather, what influences the extension of the flexible pp. 92-93) when she presents the process of the differen- space are, first of all, the rules which discipline agents’ ac- tiation of four parks in Philadelphia, namely Rittenhouse tions in space. In fact, it could be that cities, or part of them, Square, Franklin Square, Washington Square and Logan evolved with a high degree of spontaneity, at some point, Circle. Located in different areas, these four parks were they may have little flexible space for the evolution of emer- the replication of the same identical design. Nevertheless, gent configurations; whilst, vice versa, highly-designed en- as Jane Jacobs claims, with the passage of time, each park vironments at some point may host a high degree of flexible has undergone the influence of the peculiar features of its space for the evolution of emergent configurations. surroundings, adapting and differentiating its internal ap- pearance, according to their different spatial circumstances Example 1: two identical buildings with the same and conditions. framework-rules, inside two identical neighbourhoods with different framework-rules The following example demonstrates that, even in the case
Reconsidering Urban Spontaneity and Flexibility after Jane Jacobs: How do they work under different kinds of planning conditions? - -
Now imagineNow an incremental transformation process set - Widening the of existing road - Construction three of multi-storey buildings along the main road local- New road - Construction multi-storey of buildings neighbourhood- New park - Subway station BY in three t2, steps: t1, t3. With the passage from t2, to t1 and from the t2 buildings t3, to neighbourhoods (not X and Y, willB), be subject different to kindsof actions. These ac tions will alter the initial spatial configurationof bothBX firstly, BX’’in BY’’, and and then andBX’’’in BY; BY’’’. and Despite the two buildings B keeping their design and func tion unchanged, the hypothesis is that what happens during the process respectively in X andwill Y lead the to buildings having substantial differences.
- - - New electric- New high-voltage line - Construction family a double of house - New expressway- New behind the building - Construction two of single family houses with private garden BX Actions T3 T2 Actions Example 1: Evolution T1
Imagine two identical buildings: B (with the same design VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME to put it simply, these buildings simply, it put to could be two identical old farms restored asrestaurants now that are located within an expanding urban realm. detail), as well as their respective neighbourhoods, X and Y, in their turn identical with but different rules.Specifically, way in way which its surrounding instance, area (for its neigh bourhood) is regulated, inevitably influences the future ad aptations such an of element. inwhich an as building)a urban (such element is designed and regulated in a very detailed the manner point to (at scale down, the at minimum level, the flexible the space),
COSMOS + TAXIS 18 COSMOS + TAXIS
Even though the buildings remain un- In brief: two identical buildings which are the product of the same design changed over time, in their initial func- and regulation may be subjected to processes of differentiation if their neigh- tion and design, we may assume that to bourhoods (which are in their turn identical) are regulated in different ways. some extent, they have been subjected to a process of differentiation, derived from Example 2: two identical and unitarily designed neighbourhoods with the actions undergone in their respective different rules neighbourhoods, X and Y, which were in The following example demonstrates that, if two identical urban settlements their turn regulated and planned in dif- that are the result of a unitary design are regulated in different ways, they may ferent ways. For instance, we can imag- undergo completely different developmental processes. Moreover, the example ine that, at the end of the transformation emphasizes that the initial architectural design does not necessarily coincide process undergone in both neighbour- with the rules that discipline future actions and adaptations. The two levels hoods, the building in neighbourhood Y has become more attractive than the Example 2: building in neighbourhood X (or vice versa). In other words, the process of Evolution W Z differentiation has been flawed from the T1 outset by the existence of different rules that must be considered as the precondi- tion for any changes which occurred in time T1 and T2 in both neighbourhoods. We may imagine, for instance, that at the 19 initial state of the process, T1, X and Y possessed completely different rules as regards the list of possible land uses, the maximum FAR, and so on.4 Actions Ordinary maintenance - Widening of the existing road However, with this example, we see - Construction of multi-storey COSMOS + TAXIS + TAXIS COSMOS the importance of rules but we still can- buildings along the main road - Opening of new neighbourhood shops not fully understand the degree of over- all spontaneity. In fact, in both cases BX T2 and BY, despite their final differentiation, the degree of overall spontaneity may still be very low; for instance, their respective rules could be thought to be instrumen- tal toward a predetermined constructed order. If this is the case, in both areas, the flexible space for spontaneous action provided by the rules could be considered Actions Ordinary maintenance - Construction of multi-storey almost absent. It might be that—we can- buildings with different uses and substitution of three old houses not exclude this chance—the rules cor- - Creation of two squares respond to precise planners’ will to reach a prefigured end state (for instance, to T3 transform X into a garden city, or to con- centrate in Y all the urban transforma- tions). If this is the case, there wouldn't be almost any degree of spontaneity since everything has been planned from scratch.
Reconsidering Urban Spontaneity and Flexibility after Jane Jacobs: How do they work under different kinds of planning conditions? ------Now imagineNow that, a certain at point, W and are BY sub To do this, do with compare the we To case 1) (example “BY” hypothetically a case represent high of overall spon level of taneity, whilst the case W represents a neighbourhood built all with once at a very degree low Thus, spontaneity. of dif fromferently the two previous examples, com not do we pare two areas with identical features, the completely but other around. way ject very to differentregulative measures. On hand,one the planners decide that has BY reached an intrinsic historical value, they and consequently, into a state choose it put to protection absolute of and preservation. On the other hand, theat same time, planners that consider is it necessary to densifyinstance, (for W contrast to of the phenomenon soilgiving consumption) the opportunity the to various landowners densify to the area. If this is the case, a sudden would makeinversion flexible W more thanBY and con sequently future open to more adaptations. emergent This eventuality is evident in the following table. rules regardless role a major play the of fact that an area evolved with a high degree spontaneity of has it or been de signed and built all once. In at particular, distin to helps it guish urban areas developed with a high degree overall of from their not) spontaneity factual (or existingcapacity to futurewelcome adaptations. emergent In fact, the to due introduction very of prescriptive rules, be may that it for a highlymerly urban emergent has environment longer no configurations. the emergent for of room evolution Whilst, theon contrary, highly detailed and designed settlements turn may in areas that flexible have spacespontaneousfor actions and configurations. the emergent of evolution This eventuality is demonstrable considering by two cases the of previous examples. the both case time at 2), “W” t3. The (example case BY may
------range of possible of range actions
The following The example demonstrates maintwo issues: As seewe with thisexample, although W and ini were Z Imagine that W and Z are two residential suburban ters for the evolution of emergent configurations; theters emergent for of evolution secondly, rather, we should we firstlyrather, at look the existing rules. onlyfirstly, it not is the initial designof spacethe that mat To comprehend how flexible how spacethe comprehend to is the evolution To configurations, emergent of it not so is importantto study whether certain settlements evolved spontaneously not; or degree overall of spontaneity subject stringent to now rules, and a highly designed urban area to open now spontaneous actions actions. Example 3: an urbansettlement that evolved with a high tations. Naturally, there are architectural constructions that adaptable aremore than rules others. remain However, the primary unpredictable condition for future spontaneous of emergent configurations. emergent of In the first instance, planning rules expand may restrict or the that can bring the physical space toward unexpected adap ably new overall urban character. Therefore, although this is an extreme case, clearly we understand that architectural design the is not only determining factor the for evolution cant process differentiation. of at If W time T3 is still the same residential neighbourhood as definedby original the master-plan, Z, the on other hand, has reached a consider tially identical (both are the unitary product of design and both built were with all the once), at passage time, of due extremelyto different rules, signifi a they have undergone expand their proprieties purchasingby and building addi FAR. tional usesare permitted, and there is possibilityno addi have to In contrast,tional in FAR). Z there are specific no prescrip tions possible about uses, and owners are always allowed to of rules’of instance, for prescription. In the W, rules set that the initial state affairs of cannot(onlyresidential be altered composed mostly two-family or one of houses with pri vate gardens. Imagine also thatthe design level of detail of bothandW isZ very high they but different have degrees future adjustments. neighbourhoods that are the an product of identical design, derstand that architecture the of work is simply a starting configurations. the new emergent point for of evolution In fact, material artefacts are modifiable conditions,opento do not necessarily not do better coincide; still, or, the design the of physical space and therules must be clearly distinguished. evadeIf completely we the question rules, of cannot we un VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
COSMOS + TAXIS 20 COSMOS + TAXIS
Example 3: According to what has just been shown, it is empirically irrelevant to dis- Evolution W BY tinguish areas which have evolved with a T3 high degree of spontaneity from others that are the results of unitary design. In both cases, the flexible space for the evo- lution of emergent configurations first of all depends upon the existing rules which discipline agents’ action in space. For ex- ample, it may be that, as often happens, typically emergent configurations, such as the medieval settlements of European Actions Widening of the Ordinary maintenance existing road cities, become almost immutable objects, Construction of multi- with no space for future adaptations or storey buildings along spontaneous actions, whilst modern the main road unitarily designed neighbourhoods start Opening of new to be adapted and reused in completely neighbourhood shops different—sometime also innovative— T4 ways (Bergevoet 2016; Franck et al. 2013; Urhahn Urban Design 2010). 21 CONCLUSION
The article maintains that the level of spontaneity in cities is influenced both by the physical dimension of the built envi- COSMOS + TAXIS + TAXIS COSMOS ronment and by the social dimension of Actions Construction of Ordinary maintenance rules. Although the physical configura- mixed-used multi- storey buildings and tion of cities is a relevant condition, in the substitution of three old end, it remains (with different degrees) houses always modifiable and open to future ad- Creation of two squares justments and adaptations and this is re- T5 gardless of their scale of design or detail. Differently, rules can completely stifle the flexible space for spontaneous actions and the progressive evolution of emergent configurations. In other words, rules can easily decrease the possibility of adapt- ing over time to the physical and social world in ways that none could predict in advance, preventing the system from reacting efficiently to various contextual needs. From this perspective, rules influ- ence and filter the way in which the phys- ical dimension of the built environment (independently from its inherent spatial flexibility) is step by step adjusted and modified.
Reconsidering Urban Spontaneity and Flexibility after Jane Jacobs: How do they work under different kinds of planning conditions? ------To conclude, flexibility conclude, To hasto not be sought in continu able idea of making idea of able rules always unstable. more This in terpretation is distant from a serious the to approach law (Buchanan et al. 2008; Epstein Rules 2009; Kaza et al. 2011). require stability. If rules are determined afresh each morn ing the by toss a coin, of there are rules no all. at In other words, be to flexible shouldnot be the rules but spacethe that innovative of they the for development actions, leave which are, by definition, unpredictable. ousadjustment the of institutional framework, has it to but be assumed as a principle, write to good rules that are as general and as simple possible and, the at same time, rules that the undesirable are of emergence avoid to able emer configurationsgent et (Moroni al., 2018). Cozzolino 2017; Moroni 2011; Rauws 2017). We must pro We Rauws 2017). 2011; Moroni Cozzolino2017; vide rules that flexibility welcome and can guarantee that existing socio-spatial configurations can be adapted over time. In other words, rules cannot be concerned with the overall physical even indicate outcomes, nor precise func tions orlocations. Rulesshould notpredefine specific states affairsof but they mightleave the futureopento a wide arraysolutions, of within transforprocess a long-term of andCozzolino mation(Moroni forthcoming). This, gen in eral, means that should we discard the traditional, strictly instrumental embracing law idea of a nomocratic approach Flexibility have and 2010). spontaneity(Moroni however, often been interpreted never-endingas a opportunity to adapt the institutional framework any time that novelties— in terms needs, of opportunities and problems—emerge in society, leading the planning systemtoward the disput ------
On the other hand, if recognize we the essential of role To give an example, during To the twentieth century, many In from brief, a planning perspective, flexibility and Hence, spontaneity and flexibilityought to be analysed, would like desire or (Alfasi et al. Buitelaar 2007; et al. 2010; provements of the of builtprovements cannot environment, we and so on), regulate the city in obtain to order preserve or the specif andic predetermined social-spatial configurations we as spontaneity and flexibility in the city functioning(i.e.,its innovation,creative for role the importance localized of knowledge, the perpetual need for adjustment and im instance, Bergevoet Aravena Franck et 2012; al. et al. 2016; Urhahn 2010). Roggema 2014; 2013; onlyscanta number actions, of must instead but be capable accommodatingof change, both in terms function of and structure, and for permit (see continuous improvements are continuously adjusted, and cannot be planned and built all from once at scratch. In the brief, design physical of con formations must not, in other words, be such as permit to thebuilt environment can adapted be slowly and innovat ed keeping by alive its existing and constitutive patterns. Configurationsof this organicallykind emerge over time, rise lively of environments (lively in the run) are long more likely when the emerge to configurationsneighbourof hoods facilitate intense spontaneous interactions and when ming process exactly because they are fur open to not therreinterpretation and adjustment their by inhabitants On the contrary, according the the to author, (Jacobs 1961). much space spontaneitymuch for and further reinterpretations, clearhave limits in promoting vibrant environments and are inclined more stagnation to and undergoing slum a already in the ‘60s, Jane Jacobs well anticipated certain ad verse effects. In particular, maintainsshe mostof that the top-down settlements developed all and once at without too short-run, efficient socio-spatialconfiguration (Akbar 1998; Callahan ThisBertaudap 2014; Romano 2010). et al. 2014; withproach, the passage time, of has shown clear limits; oped all once, following at the idea that detailed master- plans plans and could comprehensive reached, have in the and innovation. large-scale rigid transformations planned were and devel spontaneity can building in bewelcomed two ways: (i) spac es that are adaptable and easily reinterpretable, pro and (ii) viding rules that unpredictable spontaneity, enable changes levels are connected they the to (i.e., refer same spatial con figuration), following work they deeply logics.different both the at primary rules meta-levelof and also the at level the of even builtthough environment. the two Moreover, VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
COSMOS + TAXIS 22 COSMOS + TAXIS
NOTES REFERENCES
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Cities, Agriculture, and Economic Development: The Debate over Jane Jacobs’s ‘Cities-First Thesis’ SANFORD IKEDA
Professor of Economics Purchase College, SUNY
Web: https://www.purchase.edu/live/profiles/624-sanford-ikeda Email: [email protected]
Abstract: Jane Jacobs (1969) argues that cities necessarily precede agriculture. Smith, Ur, & Feinman (2014) argue that ar- cheological evidence conclusively demonstrates that Jane Jacobs’s thesis is wrong. Taylor (2014) takes issue with their defini- tion of a city, while I point out certain limitations on their concept of agriculture. Nevertheless, even if Jacobs is wrong about the precedence of agriculture, I argue that the urban processes that she describes and that I have elaborated on elsewhere can still serve as the basis for understanding the spread and further development of agriculture as well as the central role of urban centers in economic development and innovation.
INTRODUCTION JACOBS’S “CITIES-FIRST” THESIS 25
There is a widespread consensus among urbanists of all In the first chapter of herThe Economy of Cities (1969) Jane stripes that cities have been and continue to be the main Jacobs argues that densely populated cities based on trade drivers of economic development (Glaeser 2011). One of the and comprised of diverse, socially distant individuals must strongest proponents of this idea, Jane Jacobs, went so far logically have preceded the appearance of agriculture. That, as to argue (1969) that the only sensible explanation for the of course, is at odds with conventional thinking. + TAXIS COSMOS development of agriculture, perhaps the single most impor- tant innovation in human history, is that it is the result of, The dogma of agricultural primacy says: agriculture rather than the necessary precursor to, urbanization. That, first, cities later. Behind the dogma lies the notion of course, is a view contrary to that of most archeologists as that in pre-Neolithic times hunting men lived only in well as the general public. small and economically self-sufficient groups, finding Recently, Smith, Ur, and Feinman (2014) argue that their own food, making their own weapons, tools and Jacobs’s “cities first” thesis is easily contradicted by the other manufactured goods. Not until some of these weight of modern archeological evidence and expert arche- primitive groups learned to cultivate grain and raise ological opinion. It is that assertion and its consequences livestock, it is thought, did settled and stable villages for the framework Jacobs developed to explain the role of emerge, and not until after the villages were built did cities in economic development, and innovation in partic- complex divisions of labor, large economic projects ular, that I wish to explore. Jacobs’s analysis incorporated and intricate social organization become possible. diversity of skill, knowledge and tastes, population density, These advances, coupled with a surplus of agricul- entrepreneurial discovery, and economic development as tural food, are supposed to have made cities possible part of a dynamic, primarily urban process, in which cre- (Jacobs 1969, p. 5). ativity and innovation is a natural, emergent outcome. If Smith et al. are right, how does it impact Jacobs’s thesis and So trade is the genesis of cities, and cities give rise to ag- her analytical framework? riculture. Although her book is concerned mainly with set- ting out a controversial theory of economic development and innovation based on the provocative idea of “import replacement,” most of the controversy appears to issue from
Cities, Agriculture, and Economic Development: The Debate over Jane Jacobs’s ‘Cities-First Thesis’ ------First, with begging a greater range (and work of oppor goats, which in the large, diverse market Obsidian New of could profit. In be for sold this way animalhusbandry takes place as an unintended consequence trade. of Jacobs also describes the same kind process of seed for hybridization, and can one the see how application the of “accidental- combined-with-self-interest”story can be applied new to specializations, in different areas including manufacturing, technology, organization,and even religion.All these of ap tion the of city-settlement can better sustain an extensive divisionlabor of and specialization resulting from innova tions. Fourth, in a dense trading environment, ideas diffuse rapidly both because trade of and because the of relatively greater social tolerancedifferences for appearances,in be liefs,and practicesthat citya in thrive. to musthave order In short, a city sense checks in Jacobs’s all the boxes that encourage innovation, including especially agricultural ad vance. The city and agriculture spontaneous as a orders Specifically, her in story Obsidian”“New of Jacobs explains agriculturehow in emerged probably cities spread it before is a story It reminis ruralto 18-31). areas pp. (Jacobs 1969, theory Carlof cent theof Menger’s origin (Menger money of example unplanned, of 257-62)—an pp. spontaneous 1976, drivenorder self-interest. by imagines She a variety rela of tively wild goats the to brought settlement traders, by who Inhire new order kind a person them tend to work). of (a minimizeto his effort, when given the choice goat ten the der will slaughter the goats thatare the hardest handle to first reserve and the tamest last.for Given the knowledge acquireshe from this specialization wouldit make sense himfor then further to specialize breeding by the tamer and the settlement evolves into city a sense. In in Jacobs’s the initialstages the of settlement, the are residents primar ily trading hunter-gatherers wild minimally or domesti cated goods as but the population grows their knowledge and tastes diversify and grow as well. see we the Here be ginnings sophisticated of agriculture and husbandry. Why? tunities) thanrural a village, thecost failure of fromex perimentation is far in a city lower than in a rural village Second, contact with 455). p. socially 2012, (Glaeser distant likely more ispeople much in a city than in a village, so ex posure different to ideas methods and which is is greater, a source stimulus of and inspiration creative for thinking largely absent in a village. in dense and diverse Moreover, populationscreate opportunities accidental for seren or Third,dipitous combination multiply. the larger popula ------
Jacobsargues that makes it sense hunter-gatherers for Central the to processinnovation of is experimentation. I have found it helpful it found I have distill to argument her in the fol for tradefor attract a larger diverse number more of peoples to beginto trading with distant peoples establishing by trade centers, the which lowers cost acquiring of a far greater range resources of and tools. Over time, the opportunities rural villages be may hostile new ideas to and new ways of doing things. Fourth, if innovation does take very spread not place may it far very or quickly, even within thecommunity the of inno let alonevator more-distant to communities,because small, the new method produces must be great enough sustain to its production, which is unlikely in a regionfarming of settlements unless trade among them is already extensive. laboris limited the by extent the of pp. market (Smith 1976, successfully to In order any31-6). new method implement therefore,the the on supply-side, demand the for goods ing is hard to come by. Third,ing is hard a successful by. come to innovation could result in a greater division labor of and specialization of knowledge, as but Adam Smith points out, the division of needs exposure ideas and novel to thought, habits of in but a rural environment, peaceful where association with so cially distant is people rare, inspiration original for think are including costly, starvation and death, and the chal the for innovatorlenge is minimize to those negative con sequences. Second, in experiment, to order the innovator First, innovation requires repeated experiment through trial-and-error. Failed experiments in a rural settlement pened that way. lowing (Ikeda 65-8). way pp. 2012, enough construct to the kinds infrastructure of conven we tionally associate with a city—monumental buildings, etc. (Childe was 1950)—because it so very unlikely hap have to the orthodox view that hunter-gathering gives to way small,farming settlements that eventually become wealthy city is the drives it way through economic development innovation, and agriculture and husbandry are the earli estexamples economic innovations. major of rejects She Jacobs“city” defines a “a settlementas that consistently generatesits economic growth from its own local econo the her For essence a genuine of 262). p. my” (Jacobs 1969, the aspect that of theory relevant the to cities-first thesis. Cities drive innovation this “cities first, rural development later” thesis (Jacobs this first, “cities rural later” thesisdevelopment (Jacobs summarizedhave I 3-48). pp. 1969, theory her economic of and elsewhere will (Ikedadevelopment 2012) focus on here VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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pear to be consistent with Menger’s genetic-causal explana- acterizes a city as a three-variable problem, with population tion. size, density of settlement, and heterogeneity of population as arguments. In contrast, Jacobs (1961) characterizes a THE ARCHEOLGICAL COUNTER-ARGUMENT city, we have seen, as a problem of “organized complexity.” Smith et al. dispute Jacobs’s claims about Çatalhöyük, and Among the supporters of Jacobs’s cities-first thesis is its alias, “New Obsidian.” Peter J. Taylor, an emeritus professor of geography at Loughborough University, UK. He has developed a concept Ultimately what is ‘urban’ is a matter of definition…, called “city-ness” which he describes as but Çatalhöyük does not meet the criteria of either of the major definitions of urbanism used in arche- a combination of cluster/agglomeration processes ology and history. Louis Wirth’s (1938) influential within cities and network/connectivity processes be- demographic definition of urbanism requires a high tween cities. These processes create unprecedented population size and density, coupled with social het- communication potentials that make cosmopolitan erogeneity. As a relatively homogenous village of 15 cities the crucibles of new ideas, innovations and in- hectares, Çatalhöyük does not come close to quali- ventions. This is what has made the impact of cities fying as urban. The alternative functional definition so extraordinary today and in the past (Taylor 2012, (Fox 1977; Marcus 1983) requires settlements to have p. 417). activities and institutions—whether economic, politi- cal or religious—that affect a hinterland. Lacking such I will comment on city-ness, and its role in the debate urban functions, Çatalhöyük does not match this def- over Jacobs’s thesis, later in the paper. inition either (2014, p. 1530). 27 Taylor has written a number of articles extending Jacobs’s cities-first thesis, one of which (2012), published in the As we will see, Taylor (2015) argues that this concept has International Journal of Urban and Regional Research in led Smith et al. to look in the wrong places for evidence of 2014 provoked the following response from three archeolo- urban emergence. gists—Michael E. Smith, Jason Ur, and Gary M. Feinman Regarding agriculture, Smith et al. seem at times to de- COSMOS + TAXIS + TAXIS COSMOS (2014, p. 7): fine agriculture as simply “farming,” which includes farm management, irrigation, and tilling. Agriculture preceded urbanism. They did not, how- ever, evolve independently. Settlement and agriculture Long before some plants showed the physical traces developed in tandem, often making it impossible to of domestication, human communities were manag- say whether one was a response to the other. ing (i.e. cultivating) morphologically wild plants via tilling, seeding, tending, harvesting and storing (Bar- Yosef 2011, pp. 181-2; Zeder 2011, pp. 224-6). As early Smith et al.: Agriculture first, cities later as 10000-8700 BCE several signs point to such man- In their response, accompanied with some obvious exasper- agement (2014, p. 1529). ation, Smith, Ur, and Feinman (2014) report on what they regard as conclusive evidence against the cities-first thesis Although they also include plant and animal “domestica- and by implication against Taylor and a host of others who tion,” what counts as “agriculture” and especially whether it have developed the thesis (Braudel; Reader; Ikeda). aligns with what Jacobs is referring to when she uses those The Smith et al. counter-argument consists of three parts: terms, remains contestable. While I am prepared to con- (1) a definition of what a “city” is, (2) a somewhat broad cede to the scientific authority of archeologists on what in conception of what constitutes “agriculture,” and (3) the lat- the professional literature they consider “agriculture,” the est archeological data on the first appearances around the Merriam-Webster (online) dictionary offers the following world of cities and of agriculture. definition: Regarding cities, Smith et al., unlike Jacobs, use a non- processual definition of a city and explicitly cite Louis the science, art, or practice of cultivating the soil, pro- Wirth’s (1938) essentially functional definition, which char- ducing crops, and raising livestock and in varying de-
Cities, Agriculture, and Economic Development: The Debate over Jane Jacobs’s ‘Cities-First Thesis’ ------, i.e. circa 7000 BCE. Çatalhöyük , posits a theory that has Jacobsian overtones Settlements had increased in size during the warm ing the at the of end Pleistocene, the but setback of Dryasthe intensification Younger forced to order in maintain settled life in agglomerated villages. The result that of intensification was domes that people ticated plants and animals—perhaps unintentionally 2006,(Hodder 243). p. they deem evidence conclusive does detract not from other analyticalJacobs’s achievements: theFor most part limit we ourselves the to narrow ques what part specify,Theynot do of however, legacy that cities in northern and southern Mesopotamia around BCE and urbanism ubiquitous 3900-3100 in the era of city-states around 2600-2000 BCE (reviewed recently the At start thein of 2012). UR, sequence, hu 2010; man communities using were an integrated agricul tural that economy was already three millennia old (2014, p. 1531). Thus, they argue that “integrated agricultural econo Interestingly, Smith et al. are confident that what tion whether of the earliest agriculture preceded post- or dated the earliest cities within individual regions. world The fact Jane that Jacobs made a basic elementaryand er this on ror relatively minor question part (a overall her of has bearing no output) the on validity usefulness or her of other general work. “Her legacy in is (2014, not question.” p. 1532). remains.In particular, theory theyher to refer not do of viaeconomic development urban innovation and import- asreplacement part that of unquestioned legacy. Hodder: The unintentionalof emergence agriculture Inany case, archeologistsdo how explain the appearance of domesticated plants, example, for in a pre-urban environ currently who Ian Hodder, ment? directs the excavation of Çatalhöyük and that, as I will explain, can actually be seen as consistent theory withJacobs’s innovation. of In particular, Hodder that suggests mies” predate the first citiesby three-thousandyears. And this, course, of also hingesThree- they how “city.” on define thousand years the to prior Mesopotamian city-states, for example, would place the agriculture of emergence right theabout time of ------
2 , but does this, but really reflect the kindof
1 Çatalhöyük
To summarize,To cities in the Near East over emerged thanmore a millennium, with initial proto-urban ag glomerations around 4400-3900 BCE, unequivocal before 10000 BCE for plants…. (2014, p. 1530). p. 10000before (2014, plants…. BCE for Theynext argue “conventional that understanding the of It is now clear is now It that morphological changes plants to and animals are ‘leading-edge not but indicators’, rather the result less of archeologically visible man strategiesagement plantsfor andanimals that began millennia earlier 9500 animals (around BCE for and attested between 8400 and 7500 various BCE for plant species (Fuller et al. Willcox 2012; 2012). furtherTo their argument, Smith et al. claim that such In the Near East, unequivocal cereal domestication on (identified basisthe morphological of changesre sulting in reproductive reliance is | humans) clearly on Regarding the archeological data, Smith et al. firstreport products. What constitutes agriculture in the professional litera greesthe preparation and marketing the of resulting (4000-3200 archeological recent where BCE) “uncov work ered a series enormous and of ornately decorated build ings.” urban origins places the firstMesopotamian Uruk”cityat changes strategies” “management follow that occurred thousands years of earlier. all picture is clear….” innovative agriculture Jacobs has in mind in cities-first her thesis? In any case, they assert that understandings “current are nuanced and suggest complicated processes…the over on studieson that evidence show animal of and plant domes tication and which breeding BCE) (8500-7600 in PPNA predates are talking the about same thing. in the manner a science. of Thus, whether the archeological evidence the rebuts “agriculture-first” thesiswould seemto depend a crucially whether on Jacobs and the archeologists have cultivatedhave the soil and raised livestock as a practice anor art, be would a stretch it probably claim to that early Neolithic settlers did so systematically and experimentally ture notwithstanding, let us note, with respect the to or dinary meaning the of that word, while early farmers may VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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Hodder explains that such an unintended consequence tion and its diffusion, due to the communication po- may occur when settlements become more densely popu- tential within and between cities that totally dwarfs lated or when many different settlements locate in proxim- levels of human communication in other types of ity to one another. settlement (2014, pp. 169-70).
Indeed, it seems quite possible that people who had Since such networks and processes may not leave lasting come together largely because of the benefits (pres- traces, so that existing artifacts may be missing what is es- tige, exchange, status, control over resources) that this sential about living cities. He writes: network allowed, ended up “accidentally” domesticat- ing plants and animals. The large agglomerations of Basically what I am arguing is that inter-city relations people would have depended on a wide range of local are better described by central flow theory than cen- resources which increasingly have had to be more in- tral place theory. Second (and more important), it is tensively collected (just because of the large numbers the nature of cities that is at issue. City-ness is built of people exploiting the same landscape) (Hodder upon a relational approach to understanding cit- 2006, p. 244). ies; archaeologists as represented by Smith and his colleagues use what Jacobs (2000, pp. 32—4) calls How might this be related to Jacobs’s overall analysis? a ‘thing theory’—definition by content rather than Recall that for Jacobs, innovation takes place in the pres- process. Here we get the only reference to a social sci- ence of trade, population density, and population diversity, ence view of cities (Smith, et al. 2014, p. 1530), Wirth’s all of which are characteristic of living cities. It is possible (1938) three criteria of size, density and heterogene- that similar conditions might arise, outside of an urban ity. Particularly in the archaeological argument, 29 context, in “proto-urban” environments—perhaps Taylor’s the ‘things’ emphasized are what are found in early “city-ness” network ideas come into play here —that mimic Mesopotamian cities—see, for example, reference such a context. to other sites that ‘have not revealed any monument architecture’ (ibid. p. 7)—so that settlements not con- THE REBUTTAL taining these things are deemed not to be cities, ipso COSMOS + TAXIS + TAXIS COSMOS facto Mesopotamia has a head start in claiming the Taylor on “city-ness” first cities (2014, p. 169) In his response to Smith et al., Taylor (2014) concedes that agriculture preceded the first appearance of cities (a conces- I find Taylor’s line of argument valid but weak. While sion that I am not quite ready to make). it is true that processes and networks themselves may not leave measureable traces, it seems reasonable that artifac- My first key point is that I have no disagreement with tual evidence of “things” traded over those networks over this evidence; as a non-expert on this topic I can only great distances or sophisticated and rapidly changing tools say that the evidence appears to be soundly based on or commodities produced via those processes would point proven methods (2014, p. 168). to the existence of those networks. The burden seems to be on Taylor to specify what kind of artifactual evidence But he does take issue with the concept of “city” that they would, even if only in principle, corroborate his assertion. use. The functional definition of Wirth used by Smith et al. Otherwise, his defense of city-ness in this context would (2014) places too much emphasis on “things”—monumental appear to render it immune from refutation. buildings and such—and not enough on the processes and networks that constitute living cities. He writes: Price and Bar-Yosef: Another archeological view on the origins of agriculture Following Jacobs (1969) and Castells (1996), I treat cit- Despite these reservations, I do favor Taylor’s way of con- ies as a process (economic development) that operates ceptualizing what a city is, which is I think much more through inter-city relations (networks of cities). This consistent with the way Jacobs looks at urban processes as process of ‘city-ness’ (further elaborated in Taylor, incubators of ideas, experimentation, innovation, entrepre- 2013, pp. 63—87) is especially conducive to innova- neurship, and economic development. However, as I indi-
Cities, Agriculture, and Economic Development: The Debate over Jane Jacobs’s ‘Cities-First Thesis’ ------became settlement, a major Çatalhöyük
But the essence of Jacobs’s analytical theBut essence Jacobs’s of framework empha Also, I earlier gleaned from his Hodder observation that is important It separate to the origins agriculture of from the process domestication of and distinguish to biology from culture in the transition from hunting to S171). farming (2011, readI this as acknowledging that agriculture and domes suggestI that combiningby these two observations it The most The important factors in the transition from the perspective the of include, authors here presented in suggested of order importance, available protodomes ticates, human sedentism, higher population density, resource abundance, geographic social and/or con straints, processing and harvesting technology, stor age, S172). and p. wealth accumulation (2011, Thisleast at is consistent argumentwithJacobs’s that nevertheless the in for agricultural order innovation and diffusionto takeplace on the scale Jacobs that describes still requires the urban process a Jacobsian of city. cumulation is least at a weak cities. precondition for sizes high concentrations from people of socially distant backgrounds are who economically secure enough (un to intentionally) experimentwith differentformsplants of and animals, and that useful discoveries they made would be diffuse to able throughout cost.regionlow at the agriculturefirst have may arisen“unintentionally.” In addi that point out tion, Price & Bar-Yosef tication are different things and that theyhave may arisen differentat times, which furthermuddies efforts todate precisely their origins against the firstappearance of cities. be possiblemay that, tentatively to conclude while the ar cheological evidence clearly shows that plant oc mutation curred the before the list conditions of the participants in their symposium analyzed, wealth accumulation ranks last. high-levels capital of accumulation the more result were of than cities. a precondition for Nevertheless, these areas are still sense, cities not and in the Jacobs’s archeological ortho doxyJacobs criticized appears maintain to that wealth ac , ------.[…]We we reallywe Current Anthropology amid concentrations of across the globe. also It ap 4
3
So, in various places around the plentiful world, resourc populationand resources pears that in each area several where different species areinvolvedin the transition agriculture, to there are multiple domestication centers of within the region. A number groups appear of be to manipulating their natural world. Another commonality among the cradles agri of culture is the rich environments in which farming originates.Experiments in domestication take not do place in marginal areas but ing and understanding this transition from hunting farming.to There is another aspectof their summary, which when Elsewhere in their overview they report: extraordinaryIn of spite advances in a variety of fields, many detailedat the symposium, know very little about the origins agriculture of arestill theat early stages theof process identify of There singleyet no There is accepted theory for origins the agriculture—rather,of there is a series ideas of and suggestions that quite resolve not the do question. theAt same time, course, of the evidence is have we scanty S168). p. and limited. (2011, First all, of their statements the about consensus among of agriculture.of that observe, on moreover, Price & Bar-Yosef es and a high diversity settlements groups or of within a re gion appear been the to have to most conducive emergence combined observations with Hodder’s the on conditions that domestication, to be may conducive is broadly consis withtent cities-first the essence Jacobs’s of thesis: cheological evidence the on first-appearanceof agriculture thanSmith do et al.—one that reflects a dealgreat more caution. Theyobserve, examplefor that data, new ideas” which appeared in much offer a (2011) Douglas PriceT. and Bar-Yosef Ofer andbroader evidently representative view more the of ar archeologists the on firstappearance of agricultureappear be leastto at somewhat overstated. In their introductiona to “The on originssymposium in held of 2011 agriculture:new catedearlier I will instead take issue with the Smith way et “agriculture.” characterize al. VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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TAKING STOCK NOTES
It seems to me that there are three ways to respond to Smith 1 http://www.merriam-webster.com/dictionary/ et al.’s argument. The first to question, as I have just done, agriculture whether their definitions of city and agriculture agree with 2 References original at 2014, pp. 1528-9. those of Jacobs and Taylor. 3 Emphasis added S172 One could also investigate, if indeed Smith et al.’s critique 4 Emphasis added S169 is definitive, what part of her “general legacy is not in ques- tion.” REFERENCES Thus, a second way to respond to them would be, again as I have just done, to suggest that Jacobs’s framework, in Childe, Gordon 1950. The urban revolution. In: Richard T. LeGates which density and diversity give rise to processes that fos- and Frederic Stout (eds.) The City Reader (2000) 2nd ed., New York: Routledge. ter innovation, might be applied to a non-urban situation. Glaeser, Edward 2011. The Triumph of the City: How Our Greatest While this response abandons her cities-first thesis, it re- Invention Makes Us Richer, Smarter, Greener, Healthier and tains the essential elements of her explanation of how in- Happier. New York: Macmillan. novation of all kinds happens, for which Jacobs’s account of Hodder, Ian 2006. The Leopard’s Tale: Revealing the Mysteries of Çatalhöyük. London: Thames & Hudson, Ltd. “New Obsidian” is really just a paradigm. Thus, while her Ikeda, Sanford 2012. Economic development from a Jacobsian broader thesis about the role of cities in innovation may not perspective. In: Sonie Hirt with Diane Zahm (eds.). The Urban be true of the earliest forms of agriculture, it may well be Wisdom of Jane Jacobs, New York: Routledge. valid for a wider class of innovations, e.g. literacy, numer- Jacobs, Jane 1969. The Economy of Cities. New York: Vintage Books. Menger, Carl 1976[1861]. Principles of Economics. Trans. by James acy, calendrical sciences, hierarchical governance, monu- Dingwall and Bert F. Hoselitz. New York: NYU Press. 31 mental architecture, and organized religion, and so on, all Price, T. Douglas and Ofer Bar-Yosef 2011. The origins of agriculture: of which are part of V. Gordon Childe’s ten characteristics new data, new ideas. Current Anthropology, Vol. 52(4): S163-S174. of what a city is. Smith, Adam 1976[1759]. An Inquiry into the Nature and Causes of the Wealth of Nations. Indianapolis: Liberty Fund. Similarly, a third response might be to again abandon her Smith, Michael E., Jason Ur, and Gary M. Feinman 2014. Jane Jacobs’ specific thesis, but to argue that, while millennia of incre-
‘cities first’ model and archeological reality. International Journal + TAXIS COSMOS mental change may have resulted in some domestication of Urban and Regional Research, Vol. 38(4): 1525-35. (perhaps a la Hodder) that long predate the appearance Taylor, Peter J. 2012. Extraordinary cities II: early ‘city-ness’ and the invention of states. International Journal of Urban and Regional of cities (rightly understood) Jacobs’s framework would Research, Vol. 36(3): 415-47. suggest that the existence of those cities exponentially ac- Taylor, Peter J. 2014. Post-Childe, post-Wirth: Response to Smith, celerated the process of innovation of all kinds, includ- Ur and Feinman. International Journal of Urban and Regional ing agriculture. [Adam Smith argued that compared to Research, Debates and Developments, Vol. 39(1): 168-71. ‐ manufacturing agriculture would see comparatively little Extraordinary Cities: Early ‘City ness’ and the Origins of Agriculture and States. Also online at http://www.lboro.ac.uk/gawc/rb/rb360. innovation.] This suggests that we look for evidence of a html significantly greater variety and volume of goods consumed after true cities were established and that likewise agricul- tural innovation accelerated and spread quickly via trade throughout any given region.
Cities, Agriculture, and Economic Development: The Debate over Jane Jacobs’s ‘Cities-First Thesis’ ------tend to propose to tend
The The contrast between masterplanning comprehensive Despite this awareness, the theory and practice plan of generate diversity. Nonetheless, diversity. generate they remain external inter inventions an otherwise spontaneous and urban complex process, thus they cannot cooperate with urban emergent systems,which are instead and bottom-up self-organizing forthcoming). (Porqueddu, phenomena and the city organized of as a problem complexity was simi argued who larly that highlighted Jane by Jacobs (1961), ning and urban design often failsto elaborate strategies that can cooperate with urban emergent systems and foster city While, diversity. in planning theory, the relationship between complexity and regulation is being thoroughly in the relationship betweenvestigated design 2015), (Moroni and living complex systems remains underexplored. In fact, urban design theory and practice are still widely based on master plans, which aim predicting at and controlling the specific of development areas. Masterplans vision the of a new comprehensive future. They impose a new overall healthy considered more form— and efficient— anon existing reality, obsolete. or considered problematic Master plans usually themselves present as finishedproj ects designed from the top-down: they the show finalout the of come transformation within a pre-defined bounded site. In their best examples, they are animated a sincere by a regime produce intention to urban of complexity to able - - - - - intention. It intention. It a priori a a constant state be of
urban design, resilience, diversity, emergence, complexity, multi-scale mapping : The recent : The theoriesplanningof and urban design recognize widely citieshow entities are complex overallwhose
Jane Jacobs (1961) anticipated many years ago that a city Jane Jacobs (1961) tion, and cultural Christiansee emancipation (Jacobs 1961; 2009). seen exchanges between disparate this and people how con centration from people of different backgrounds and their constant interaction stimulates economic growth, innova an essential its condition vitality for and resilience. She highlightedplaces which how living as behave complex systems retain an endless capacity encourage to unfore themselves interconnections section into emergent (see 3). organized of is a problem complexity and that diversity is is resilient because disturbances can be accommodated by fluid adjustments: in fact, heterogeneous the components theof system retain the capacity endlessly to re-organize predicted in advancebecause is it in coming. a system Such arises from unforeseen interactions rather than being determined an by (Allen Christiaanse, and Sanglier 1981; Rieniets and Sigler 2009; Portugali The main 2012; Dovey 1999; Sennett 2013). characteristic an system of emergent is that cannot it be The recent The theoryplanningof and urban designrecognizes vibrant healthy, how cities livingas behave complex sys tems: they are self-organizing, open, bottom-up, emergent Fostering diversity: emergent directing rather than mastering change which can discourage) their encourage (or positive evolution. Keywords: than cooperating with place-specific dynamics. emergent of a designfoster to order In approach which development the can instead become an integral dynamics, emergent of element the paper proposes present a Multi-Scale to Atlas as a tool: (1) detect and explore the multi-scale nature urban emergent of identify to systems; and the (2) site-specific spatial conditions form cannot be predicted inadvance, emerging as does it from the interaction bottom-up between human and material Despite thiscomponents. awareness, the current practice planning of and urban design oftenpredict tendsto and control the future pre-defined of development areasproposingby mastertop-down orders ratherplans comprehensive emergent over Email: [email protected] Abstract a Multi-Scale Approach Approach a Multi-Scale ELENA PORQUEDDU Detecting and Directing Emergent Urban Systems: Systems: Urban Emergent and Directing Detecting VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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modern top-down planning strategies were destroying di- In the domain of this new metropolis, diversity emerges versity in American cities. Jacobs highlighted how vital cit- according to the distinct mixture of both local and wider ies require “an intricate and close-grained diversity of uses flows intersecting at specific points in time (Massey 1994). that gives each other constant mutual support, both eco- In this respect, the mere scale of architecture would not nomically and socially”. According to Jacobs, “the science highlight the social-spatial dynamics beyond the boundar- of city planning and the art of city design, in real life for ies of a specific site and the wide metropolitan scale would real cities, must become the science and art of catalyzing not reveal anything about the micro-space scene of percep- and nourishing these close-grained working relationships” tion and human interaction. (14). For Jacobs diversity cannot be entirely planned or de- In order to shape this multi-scale approach, this paper signed because it is an emergent property of the relation- combines: ship between people and their physical environment, rather than the mere consequence of a peculiar spatial layout or of 1 the recent advance in theories of emergence, a certain density of pre-defined functions (Porqueddu 2015; complexity, assemblages, adaptation (Allen and Saliger Ikeda 2017). 1981; Portugali 1999; Dovey 2012; De Landa 2006; Furthermore, she highlights how top-down planning Gunderson and Holling 2002; Miller and Page 2007; and design are not the only threats to emergent diversity Walker and Salt 2006), which inform an understanding and she stresses how diversity can spontaneously veer to- of adaptive cycles across scales. ward its self-destruction. In this respect, she advocates the 2 The current advances in mapping techniques (Corner need for a kind of planning and design which does not in- 1999), which can visualize unforeseen relationships terfere with the spontaneous emergence of diversity, but at between emergent urban form and heterogeneous data the same time, intervenes in order to prevent its emergent concerning the behaviour of people across specific 33 decline. She suggests that the role of designers and planners territories and their emergent ways of using and is not shaping the city from the top-down, but monitoring transforming the existing urban spaces. the unpredictable evolution of emergent orders within a city and understanding when an action is indispensable for in- By integrating Jacobs’s phenomenological social-spatial verting a negative cycle, in order to foster or maintain “city approach with this multi-scale understanding, the current COSMOS + TAXIS + TAXIS COSMOS vitality (something that the planner or planners alone, and paper endeavours to formulate a method of inquiry which the designs and designers alone, can never achieve)”(14). not only helps us understand the city as an emergent sys- The aim of such planners and designers is not fixing the tem, but also enables designers and planners to detect problems through external interventions, but rather becom- place-specific latent capacities for emergent diversity and ing acquainted with the behaviour of people across space, in to uncover the risks for its self-destruction. Here this ap- order to make more efficient use of their natural capacity to proach is considered fundamental to developing design and maintain and increase diversity. In this respect, they need planning strategies which cooperate with emergent trans- to observe more and design less. This attitude requires re- formations rather than trying to master them. In this re- search methods and approaches, which make it possible to spect, the present paper (1) traces a strong (but non-linear) question places, in order to detect—within emergent trans- connection between place analysis and design practice; (2) formations—the risks for the self-destruction of diversity shapes a method of inquiry capable of informing every de- and to uncover latent capacities for its emergence. sign project that tries to cooperate with the unpredictable In order to shape such a method of inquiry, the pres- nature of cities and their adaptive cycles across scales. ent paper builds upon Jacobs’s phenomenological social- The article is divided into five sections. The first section spatial approach, but it extends it to a multi-scale level. In illustrates the contrast between master planning and the fact, a multi-scale understanding becomes indispensable unpredictable emergent nature of city vitality through two in the contemporary city, where the rise of mobility and examples. The second highlights how the recent advance in communication technology has brought about a network theories of emergence, complexity, adaptation and assem- of exchanges between discontinuous places—opening up blage can inform a multi-scale approach. The third section new possibilities for interaction and exchange beyond the introduces the Multi-Scale Atlas as a tool for such social- traditional relationship of proximity (Harvey 1990; Massey spatial multi-scale investigation. The fourth section illus- 1994; Castells 1996; Amin and Thrift 2002; Boelens 2009). trates how the Multi-Scale Atlas explores (1) the cross-scale
Detecting and Directing Emergent Urban Systems: a Multi-Scale Approach ------out
incorpo
thatcan
fast connections which, which, fast connections
Integrated Urban Projects),
can enhancerather than damage the existing slow
the poor, informalthe poor, sectors Medellin of with the rest
This detailedobservation revealed that these informal A contemporary example concerns the realization of cilities, thus partially compensating the for lack services of in social reduce the area; and es and economic costs (4) (it chews the demolishmentlarge a of number dwellings of in build the Metrocable a rela (5) build to over order roads); tively short period time of as requires it little in terms of landforthcoming). acquisition (Porqueddu, In this respect, theMetrocable isthe missing ingredient rate these informal settlements into a new system rela of through the collaboration between architects, planners, community representatives, social workers, city adminis trators and the private sector (Davila 2013). settlements an have important resource: a peculiar and vitalnetwork micro-connectivity, of which supports the socialemergent and economic relations a local on scale. Nonetheless, also it revealed that their of one limits—beside the well-known related extreme to problems poverty and lack services—is of that this labyrinthine structure is not inserted into the network fast of connections a metro on politan scale and is thus cut off potentialfrom exchanges withother places and therefore from the potential emer for In diversity. this gent context, the Metrocable projectis a creative solution that can provide turn, in micro-connectivity forthcoming). (Porqueddu, In actual fact, build the fast adopted strategy and di (1) enables to: rectconnections between these informal settlementsand the wider metropolitan territory without damaging the ex istingmicro-connectivity; slow turn the (2) steep terrain of the mountains into a potential a stunning for panoramic utilizeview the city; over whole (3) the Metrocable stations as cluster to hubs a variety cultural of spaces and sport fa and to self-produce the solutions to emergent problems, problems, and the self-produce to emergent to solutions without trying predict to and the control final,formal come of the transformation (Porqueddu, forthcoming). the Metrocable network in Medellin—as part the of PUI (Proyectos Urbanos Integrales; theprogramme complex city of transformation promoted theby Medellin municipal and government coordinated Alejandroby Echeverri (Echeverri The and Orsini 2010). Metrocable basically endeavours reconnect to and re-inte grate theof city through selective intrusion into their social sys tem and minimal damage their to existing structures. The design detecting by idea emerges here the spatial condi tions which can threaten foster or A diversity. emergent deepknowledge the of local is developed orders emergent
------ur condi
a priori a the mod
in different
. Instead, they a priori a accept their unpredictable
top-down designed spatial con
a priori a a specificplace with the missing ingredient
designed spatial configuration onto an existing
a priori a
Nonetheless, there are other ways understanding of If diversity cannot be the direct result human of design which can activate its ability in evolve to positive directions is possible fix to actualthe situation re from by outside the placing with it a better designed one aim provide to ban design, animated the by observe intention to the exist ing reality and cooperate to with orders. These emergent abandon completely approaches the modern illusion that it and context. often desolate lackingand in diversity—this approach is still based the on illusion that the can problem be fixedby external agents, designers and planners,a new apply who a reality considered negative. While the aim is laudable—to thesolve linked problems urban to and sprawl upgrade to the everydayexperience these of places, which are in fact eryday experience across the urban fabric the of American suburban sprawl, which tends it reject to and replace. New Urbanism superimposes a top-down designed new city on figuration can generate diversity (Porqueddu 2015). figurationIn fact, can generate 2015). diversity(Porqueddu UrbanismNew elaborates the a new model of metropolis, rather than focusing upgrading on and updating the ev (Duany, Plater-Zyberk and Alminana Plater-Zyberk (Duany, apparently 2003), arguments,based Jacobs’s on is instead linked to ern illusion that an who travelwho beyond the boundaries specific of sites. thenthe city Urbanismproposed New by (Jacobs1961), ty in a certain (Floor Area or terms Ratio) FAR of more Even defined 2015). of combination uses(Porqueddu in the contemporary metropolis crossed of people flows by humanbeing them. a group of of or In this respect, there can be fixed no cause-effect relationship betweenemer the diversity of gence and certain specificbuilt formor densi nature:diversity can and emerge self-destruct places and situations far beyond the imagination a single of urban systems If fully we embrace the idea that diverse vital cities behave as living systems, must also we sions. The contrast between masterplanning emergent and tionswhich increase diversity emergent andcontrast its de cline (this section theto refers case study the where Atlas has The last been developed). section generaldraws conclu effects of emergent changes, (2) effectsplace-specific changes,the (2) of emergent tions which foster and threaten diversity emergent across this how scales, understanding and (3) can inform the ac VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
COSMOS + TAXIS 34 COSMOS + TAXIS
tionships. In this case, an effective collaboration involving Understanding emergent urban systems: a Multi-Scale planners, designers and the public administration gener- Approach ates an intervention which is not intended to re-design the The following section illustrates how theories of complexity, informal settlements (by proposing a new order from the emergence, self-organization, assemblage, adaptation can top-down). Instead, it endeavours to provide a cross-scale support a deeper understanding of cities as complex living connection which can prevent the self-destruction of diver- systems and can consequently inform possible actions con- sity across the area and increase the existing potential for its sistent with their emergent nature. In actual fact, complex emergence. In this respect, by connecting the existing vital systems have been explored in disciplines which are not slow micro-network with the wider metropolitan territory, directly linked to urban studies. Non-linear systems have the Metrocable activates the site-specific ability for unfore- been investigated by biologists, mathematicians, and physi- seen exchanges with the rest of the metropolis, without try- cists; by ecologists such as Gunderson and Holling (2002) ing to pre-define or control them. and Walker and Salt (2006); and by social scientists such as Around the world, there are some scattered examples Miller and Page (2007). Furthermore, Complex Adaptive of this approach to design. In another forthcoming paper, Systems (CAS) theory has recently been applied to urban I begin to collect and compare them, exploring what they studies by Kim Dovey, who combined it with Assemblage have in common, in order to start developing a theory of Theory (De Landa 2006; Deleuze and Guattari 1980; Dovey emergence in urban design. On the one hand, they are all 2010; 2012), in order to frame and explore places as socio- extremely different, operating at different scales and be- spatial territories in a continuous state of becoming and cit- longing to very distant geographic areas and heteroge- ies as emergent systems (Johnson 2001). neous urban situations: these strategies must necessarily CAS theory and Panarchy (Gunserson and Holling 2002) be unique, being creative responses to immanent and site- are particularly relevant because they show how complex 35 specific conditions. On the other hand, they do have some- living systems evolve in time, across different scales and thing in common: they are based on a deep understanding how it is necessary to understand their cycles in order to of the place-specific social-spatial dynamics across different prevent their decline. On the one hand, these theories stress scales and they are intended to make more efficient use of that diversity and redundancies of parts are critical to a the spontaneous capacity of places to maintain and increase system’s vitality and resilience: in diverse systems no single COSMOS + TAXIS + TAXIS COSMOS their potential for diversity. In this respect, although these part is crucial to the success of the whole; therefore the sys- approaches do not even refer to Jacobs’s theory, they are tem can endlessly adapt to unpredictable situations by re- consistent with it, being based on continuous minimum ad- organizing itself into emergent inter-connections. On the justments and real life observation rather than on overall other hand, they also show how diversity and redundancy comprehensive plans based on abstract principles. Jacobs can self-destruct across adaptive cycles and how cross scale affirmed that cities are themselves suggesting to the bet- effects play an important role in this process. These recur- ter planners and designers (the ones who are able to listen ring cycles consist of four phases: rapid growth, conserva- and carefully observe complex processes) “what principle tion, release, and reorganization (Gunderson and Holling of planning and what practices in rebuilding can promote 2002; Walker and Salt 2006).1 social and economic vitality in cities, and what practice and Nonetheless, when we talk about adaptive cycles in cit- principles will deaden these attributes”(4). ies it is easy to become too focused on the specific scale in In this respect, these kinds of intervention highlight the which we are interested (a building, a street, a plaza, a block, urgent need for theories, methods and tools aimed at ques- a neighbourhood) and ignore cross-scale effects. According tioning places in order to understand their emergent com- to CAS and Panarchy theory, the crucial point is in fact to plex orders. The multi-scale approach presented here has consider that the scale in which we are interested is con- emerged in order to respond to this need for methods of in- nected to and affected by what is happening at the scales quiry, which are an integral and fundamental part of such a above and below, both in time and space, and that the link- design process. ages across scales play a major role in determining how the system is behaving on another scale (Guderson and Holling 2002). In this respect, if we fully consider the city as a com- plex living system, we cannot successfully interact with it by focusing on only one scale.2
Detecting and Directing Emergent Urban Systems: a Multi-Scale Approach ------This
. 5 This is layer important because livingcomplex systems require open unfixed interactions betweenheteroge neous components. Building footprintand density: this the shows concen tration and mix building of types combined with data densityon in terms Floor of Area Ratio (FAR). is relevant layer because density in terms Floor of Area Intensity and rhythms: daily shows it concentrations of inpeople specificplaces accordingto different time cy cles, geographies event and flows. commuter Thislayer is important because, as previously highlighted, diver sityemerges from distinct a mixture heterogeneous of crossingpeople in space (Massey 1994; Jacobs 1961). Activities and uses: the shows it distribution, concen tration and types activities of across the territory. The mix heterogeneous activities of and uses is considered the of one main diversity. of generators connections:Network of the how network shows of it streets, parking lots, sidewalks, etc. supports fast and Accessibility of people. flows slow of one is considered the main factors which concentration fosters emergent of people. Boundaries and private-public interfaces: how shows it the and types layout physical of encourage borders or discourage unforeseen interaction between heteroge neous activities and between public and private spaces. In thisrespect, the Atlas combines a multi-layer analy 5. existingspatial and emergent di support layouts emergent versity across scales? they do How foster its decline? The matrix is organized into five thematic strips, accordingto the 2015): following(Porqueddu five layers 1. 2. 3. 4. 2015), thus revealing2015), unexpected potential diversity for to flourish A Multi-Scale Atlas explore to theIn order multi-scale nature ur emergent of ban systems, Multi-Scale a Atlas proposed is as here a tool anfor empirical investigation which a social-spa develops tial understanding across scales. siswith a multi-scale mapping in a matrix which (Figure 1) makes possible explore it to the links between people’s activitybehaviour, rhythms and the physical that layout supports them multiple at scales. the Here, focus on is not individual the maps, on but actual and potential relations Corner 2015; between and Dovey Wood them 2010; (Dovey Atlas The faces1999). following the questions: how can the ------diversity
theoriesof
the scaleappropriate of
Atlas in presented the next paragraph,
Her observation Her also revealed linkages how these studies, Jacobs (1961) anticipated the thesestudies, Jacobs (1961) 3 networks stretching local of out boundaries
. In fact, as a set material of the components, 4
The Multi-Scale In order to develop such a multi-scale develop to In order is it approach, AlthoughCAS and Panarchy theories are mentioned not Long before rather than as parts committed local to units (Porqueddu raphies. In this respect, the Atlas enables us understand to heterogeneous micro-spaces emergent of as components socio-physical day life increasingly far develops the beyond boundaries of a specific settlement and where of emergence the diversity is increasingly related mobility, to time cycles and geog event combines Jacobs’s socialcombines Jacobs’s spatial understanding with a multi-scale which approach, becomes indispensable inthe domain the of contemporary metropolis, our where every needs, desires, tastes, electricity, etc. actions, water, money, 2010). Dovey 2015; (Porqueddu dows, do not interactdows, not do without people—they are just scat potential of tered elements living systems emerging in the its presencechanging of people, behaviour, components: across them city Buildings, is system a simple (Portugali roads, 2013). bridges, fences, traffic lights,sidewalks, trees, shop win necessary investigate to the dynamic relationship (dance) between the physical urban of components space and the existing behaviour and emergent and activities people of the intervention according a multi-scale to understanding diversityof cycles. undertakenin retain to order city and improve vitality a on microscale. Inthis respect, CAS and Panarchy identifying for good a approach fer retaindiversity the at micro-scale the of neighbourhood was enhanced tracing by new connections with the larger scale the of city; that is say that to a widescale action was inMedellin project, the Metrocable strategy isbased a on deep understandingcross-scale of links: the potential to thiscase micro-cyclea can be positively affected by wider processes. scale their diversity release growth), rapid (from to only if they are surrounded other by streets which are in a phase of flourishing (rapid growth). diversityThat tosay is that in and resilience cycles. In fact, argued she that streets which experience theself-destruction diversity of after a success ful period (late conservation can phase), quickly regenerate the same which forces nourish diversity could contribute to destruction.its across scales are a key aspect in understanding tendency outstandingly for successful diversity in cities to destroy itself across time cyclesand argued she that often VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
COSMOS + TAXIS 36 COSMOS + TAXIS
Ratio and compact urban form are still central in the These maps enable us to study specific micro-spaces in discussion on city diversity.6 relation to a wider network of relationships. In this respect, they can help frame the scale and type of problem by high- Every layer is investigated on a wide range of scales, with- lighting the multi-scale dynamics in which micro-spaces in the framework of: are immersed. In order to frame the scale of the problem, and develop 1. 15 m and 15,000 m2. This scale shows how space is an appropriate action, it is necessary to observe existing perceived and how it supports face to face interaction territories from different points of view. In this respect, between people. This is the scale of architecture and the Atlas also aims to become a cross-discipline tool for design. intersecting data collected through investigation from dif- 2. 1.5 km2. This scale shows whether the spatial layout — ferent disciplines such as geography, social science and at the scale of a village or neighbourhood—supports anthropology, landscape urbanism, etc. In actual fact, ge- people movements and their interaction across differ- ographers and planners collect data about people and their ent activities and spaces. This is the typical scale of ur- emergent activities, but they often show these data through ban design. widescale maps, which do not illustrate the physical urban 3. 300 km2. This scale shows the main infrastructures in environments (on a micro scale) where these activities and relation to the existing urban fabric, natural environ- businesses take place. Architects often focus on the hu- ments and administrative boundaries, and it highlights man scale, but they rarely observe the behaviour of people the flows between different settlements. This is the typ- across different scales. Social scientists and anthropologists ical scale of planning. observe human behaviour and informal practices, but they 4. 15,000 km2. This scale situates this territory within the rarely map them (and mapping is the only tool that can 37 wider scale. It is typical of regional planning and geog- draw connections between space, people behaviour and raphy. flows, emergent mixes of uses and activities). Landscape ur- COSMOS + TAXIS + TAXIS COSMOS
Figure 1. Multi-Scale Atlas (Matrix example)
Detecting and Directing Emergent Urban Systems: a Multi-Scale Approach - - - - - inhabit
inhabitants: inhabitants:
) is situated the at 2 areas—and includes eight these of munici
inhabitants. inhabitants.
The Atlas The has been developed acrossdensityItalianlow a palities centre The major smallis a (Figuretown ap 3). of proximately 40,000 inhabitants, the others being villages of 5,000 to 900 area, called the Oltrepo’ Pavese, a fine grainnetwork old of settlements nodes, and recent more situated 50 km south of Milan (within the Province the at Pavia) of intersection of twoimportant infrastructures connecting Milan, Genoa, and Bologna.Turin The ProvincePaviaof mosaic190is a of micro-municipalities, with 172 less than 5,000 the of 43% population lives in thesetraditional old settle a distance at ments km from 2-7 each of other (Figure2). This pattern—significant local differences notwithstand ing—is prevalent throughout the Italian whole territory, municipalities of 72% where than fewer have 5,000 ants Italians and of 43.7% live in such settlements (Census The of ObservationArea (300 2001). Km betweenborder the plain and the hills—agricultural and wine-growing - - - - - Figure 2. Administrative The boundaries;Province(a) Pavia. Built-upof Network areas of connections; (c) (b)
andthe on distribution activities of across the territory Census 2001). collected(data from ISTAT- Throughmulti-scale mapping. Through behavioural-photographic surveys(the field requiredwork the direct experience the of mapped areas including travelling across the territory differ at speeds—driving,ent walking, public transport experi ence—and engaging with while people observing their behaviour across space). Through data analysison commuting tourist and flows Through interviews(with inhabitants, administrators and associations). because they with work living materials and they need
The The maps amalgamate the data collected:
4. 3. 2. 1. respect, the Atlas aims cutting at across all these disciplines heterogeneous typesin welcome to order data, of both qual itative and quantitative. and life-cycles, they but mainly focus natural on elements and they rarely use mapping as investigate a tool to emer citygent diversity (cultural, economic, social, In this etc.). banistsare the masters in using multi-scale mapping. This is understandto eco-systems systems) are emergent (which VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
COSMOS + TAXIS 38 COSMOS + TAXIS
Figure 3. (a) Observation perimeter (300 Km2 frame): Eight municipalities; (b) Aerial photo 39
One of the reasons for selecting the Oltrepò was that the from major centres toward smaller settlements (Figure 4). importance of a multi-scale social-spatial approach is more In this respect, when observed on a wide scale, this territory evident through a low-density territory where a tradition- behaves as an emergent low-density distributed system, an
al observation would never highlight the emergent urban open network where every single settlement has the poten- + TAXIS COSMOS complexity of this territory, which is visible just through a tial to become a node connected with several other nodes. social-spatial exploration across scales. In actual fact, one In such a system, hierarchy is always shifting: every node single settlement here is neither large nor dense enough to could become the centre according to time cycles and event generate diversity within its boundaries. The only possi- geography—a “meeting place” (Massey 1994) behaving as a bility for flourishing diversity here is related to temporary component of socio-physical networks stretching out of lo- concentrations of locals and strangers—coming from dis- cal boundaries. In this respect, the Atlas shows that even continuous places—within the same urban fabric. In fact, a settlement or suburb which might look neither large nor local street life can be here nourished just by wider flows, dense enough to generate diversity within its boundaries, developing on a metropolitan scale. Jacobs herself argued could in fact do so across its urban fabric, according to tem- that even a small town can become a complex realm, once it porary concentration of locals and strangers—coming from “is encompassed in a metropolitan orbit with its multiplic- other settlements (Porqueddu 2015).7 ity of choices and complexity of cross uses” (Jacobs [1961] 1992, p. 435). Instead, by focusing also on the observation of activ- ity rhythms and on the behaviour of people in space and time (how they use the territory in their everyday lives), the Atlas highlights how this territory is becoming far more complex than a sum of small settlements depending on a wider metropolis. In fact, data analysis, interviews and be- havioural surveys reveal the presence of considerable ev- eryday horizontal flows between small municipalities and
Detecting and Directing Emergent Urban Systems: a Multi-Scale Approach Figure 5. Six sites b) to identify,to across the case study area, the places which own the potential become to
The The specific for smallsites scaleinvestigation were selected according tothe informationcollected duringinterviews and a) nodes which or already as behave nodes in the network (Figure 5). data analysis, which made possible it Figure 4. settlement: Major Commuter(Mon-Fri). flows Outgoing commuters; commuters. Incoming (b) (a) VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
COSMOS + TAXIS 40 COSMOS + TAXIS
Detecting risks and potential of emergent second discourages any unpredictable synergy between lat- transformations est hubs and existing activities. In actual fact, the first tends The Atlas illustrates how the emergent change can gener- to orient the emergent flows of people across traditional ate positive and negative effects (here the transformations settlements, thus increasing the potential for emergent di- which foster emergent diversity are considered positive, versity and for new flourishing activities. The second tends while the transformations which foster its decline are con- to orient these regional flows toward top-down designed sidered negative). unalterable precincts, which are totally disconnected from On a wide scale, the Atlas highlights the presence of a new the local network. layer of distributed metropolitan attractions (such as hotels, The potential for emergent diversity within small settle- spas, sport centres, new workshops, shopping outlets, shop- ments is increased when these latest hubs are placed at a ping centres, important showrooms, famous restaurants or walkable distance from local activities—such as the bakery, clubs) that can catalyze metropolitan flows of people. These the butcher, the newsagent, the primary school, the church, attractions are spread across the entire territory, generating etc.—and, more important, when they co-exist and interact a new intensity of flows in and out of small municipalities. with them in space and time. Figures 6, 7, 8, 9, show that Nonetheless, the maps also reveal how these new activities this occurs according to the following spatial conditions can increase or decrease the potential for emergent diversity (Porqueddu 2015): and how this is chiefly related to their distribution across the micro-scale spatial layout. 1. Metropolitan attractions are interwoven with local In actual fact, the Atlas illustrates the presence—at the activities across the fast-slow network of connections micro-scale of architecture and urban design—of two dif- (Figure 6). ferent spatial layouts. The first encourages an endless -ex 2. This mix of local and metropolitan activities is situ- 41 change between metropolitan flows and place-based street ated at a walkable distance from regional arterial roads life, between regional attractions and local businesses; the (Figure 6-7). COSMOS + TAXIS + TAXIS COSMOS
Figure 6. Local-metropolitan interaction
Detecting and Directing Emergent Urban Systems: a Multi-Scale Approach
Figure 7. Multi-scale Atlas. Multi-scale Activities-uses 7. Figure VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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43 COSMOS + TAXIS + TAXIS COSMOS
Figure 8. Multi-scale Atlas. Network of connections and parking lots
Detecting and Directing Emergent Urban Systems: a Multi-Scale Approach
Figure 9. Multi-scaleFigure 9. Atlas. Boundaries, public-private interfaces VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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3. Small and medium size parking lots are scattered at the The potential for emergent diversity within small settle- edges of the settlement as well as across its fine-grain ments is decreased when the latest hubs are disconnected urban fabric; their strategic position and size encour- from local activities. Figure 10 shows that this occurs when: age people coming from other places to leave their cars and walk through the settlements. This increases the 1. New metropolitan attractions are enclosed within pre- pedestrian traffic in front of local shops—thus nourish- cincts and committed to them. The boundaries of these ing their businesses—and plugs new flows of strangers precincts are impermeable and definitive. All the ac- across the small settlement, thus fostering the potential tivities overlook the internal part of the precinct, with for random and unpredictable face to face interactions, no possibility for interaction with the external side- encounters and exchanges (Figure 8). walks or other local activities, even when they are ad- 4. New activities are not committed to wider precincts or, jacent to them. Furthermore, different activities within if they are part of a wider precinct, then they retain a a single precinct do not retain any autonomy in terms certain degree of autonomy in terms of rhythms and of rhythms and management and in terms of spatial management (if one of these closes at 6 p.m., the oth- layout. They are strongly top-down pre-defined and ers can remain open until 3 a.m.). Such precincts are controlled: there is no possibility of adaptation and no provided with multiple access which integrate them possibility for unpredictable interactions between het- into the external fast-slow network of connections and erogeneous businesses, also within the precinct. parking systems. They have diverse and non-definitive 2. These precincts have only one access, connected with borders—single units can overlook both the inner a large private parking lot overlooking fast arterial pathways and the outer sidewalks. Accesses and pri- roads, without any connection with the local network vate-public interfaces can change according to differ- of activities, even when they are placed at a walkable 45 ent time cycles and adapt to unpredictable conditions, distance from them. Flows of people travelling on a re- needs and behaviour, thus fostering unforeseen syner- gional scale can directly reach these activities without gies between heterogeneous activities (Figure 9). walking through the settlement, which remains cut off from these new flows. In this respect, these new met- ropolitan flows do not increase the potential for en- COSMOS + TAXIS + TAXIS COSMOS counter and exchange (diversity) within the traditional Figure 10. Local-metropolitan disconnection small settlement.
loose precincts
inalterable boundaries old nucleus
local activities metropolitan attractions
parking lots
Detecting and Directing Emergent Urban Systems: a Multi-Scale Approach ------
9 of landsof and buildings creativity designers of
what innovations concerning building and planning regulations
structure integrated is not into the
overall bureaucratic process is usually
when they (Figure are it to adjacent 10).
theadaptation the of existing urban fabric
10 existing urbanfabric. theHere is crucial in turn to order existing into op problems portunities update to and upgrade our daily experience urban of space (functionally, technicallyand aestheti cally). Experimenting innovative spatial solutions, materi als and technologies, which make possible adapt it to existing buildings and urban spaces ac emergent to Experimenting innovative spatial and infrastructural (place-specific)solutions that can integrate the his torical urban fabric into the regional metropolitan network, without generating traffic or problems other kinds conflicts of withinsingle settlements. entailsThis the revision the of current infrastructural network and the andof distribution layout parking of lots across the The question The then becomes: Furthermore,the procedures obtain to construction or With regard the to spatial might the layout, nuclei old 2. present problems of accessibility. of problems present On the hand, one they usually offer an intricatenetwork of micro-connectivity, which can foster unforeseen synergies between heteroge neous activities and between private and public spaces, often but this intricate network fast of arterial roads. On the other hand, the new nodes situated along them are often isolated from this mi cro-network, even the system rules of and the spatial are necessary layout in facilitate to order and historical)(recent changes, emergent to while enhanc ing its aesthetic quality? The systemof rules not is investi gated in this although paper, is it crucial managing to city In regard the to spatial complexity 2015). layout, (Moroni the main challenges—for urban designers and architects— are: 1. With regard the to latter, a crucialplay in role orienting the position metropolitan of attractions. In fact, in Italy rules restrictive be to tend more within While historical the inten 2015). centres (Moroni tions these of restrictions are valid protect the aesthetic (to valuethese of urban often areas), they can alsoprevent the adaptations necessary update to the historical buildings and them activities render suitable emergent for and uses. permitsrenovation are complicated when the more project is developed in historical buildings within or the histori cal urban fabric. The and thuslonger entails economic costs are major al (which ready higher the to due greater value within the historical nuclei). ------a
activi
planned nor designed,
and (2) shaping new connections and (2) 8 these settlements remain to open, adaptive
regional network fast of arterials. politan businesses across spread to this at territory, but the same time would it transform their negative effects into new potential synergies with existing local ties. Revise the network streets, of in better to order inte grate the micro-network slow the of villages into the ers of the ersof new businessesplace to them the outside ex isting settlements. Shaping a series actions of which can invert this trend and the render inner part the of settlement appealing new activitiesfor and businesses. These actions should interferenot with the spontaneous tendency metro of Understanding thereasons which encouragethe own
Some of the of Some reasons which might induce the owners of In this respect, the Atlas highlights the how challenge On the hand, one the Atlas highlights this how terri es concern the spatial layouts, other the planning system. businesses situate to new activities far from the villag old 3. 2. can focus on: 1. these strategies should aim never producing at a top-down definitionof the typesof activities and theirplace within existing villages and across the wider network. Instead they between the new metropolitan attractions and the micro- network local of businesses. Since, as previously illustrated, can phenomena neitheremergent be ers consists in shaping strategies, encour which could (1) age the these presence of new activities within the urban fabric existingof villages and diverse (Figure 6, 7, 8, 9). and 8, diverse 9). (Figure 6, 7, the of local administrations, planners and urbandesign businesses and metropolitan attractions can also coexist and interact within small settlements and that this interac tion can enable between settlements old and new hubs, thus contrasting Nonetheless diversity. theemergent Atlas that shows local village; the experience nature and of (3) in the countryside. Onthe other hand, also it highlights the spatial emergent conditions, which instead tend crystallize to a separation low densitylow rural metropolis every where single settlement the intensity and might become combine: to a node (1) able diversity the the of city; sense safety of (2) and calm the of front door is door front a threshold between a potentially vibrant and diverse urban street and the peaceful rhythm slow typical a countryof village This could 1984). evolve into (Lynch tory, whenobserved tory, a wider on scale, retains the potential distributed as behave to complex a metropolis, every where VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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tivities and uses. This type of innovation concerns The first level concerns the micro-scale of individual ini- soft interventions which enable fast adaptations with tiative. This is the small scale of fast changes which derives minimum costs. The techniques which facilitate high from the will of citizens to endlessly transform existing quality transformations with minimum structural and spaces according to their emergent needs. This level also architectural interventions are particularly interesting. concerns the ability of architects and interior designers to In actual fact, they can update the existing urban fabric form innovative solutions that can update the existing ur- of the historical centres, by enhancing their aesthetic ban fabric in a short time. This first micro-scale level con- quality. (Interior design and landscape architecture cerns two types of intervention: are the fields which better explore technique for “soft” 1. “soft” interventions of design (concerning the revi- transformation). sion of the inner distribution, new finishing, lighting 3. Experimenting innovative techniques which could design, but also the restoration or restyling of existing provide existing and new buildings and precincts with facades and the adaptation of public-private interfaces) responsive, reversible private-public interfaces and ac- able to endlessly re-interpret the existing buildings for cesses that can easily adapt to unpredictable situations new purposes and to adapt them to the new technolog- and unforeseen individual-collective needs. As previ- ical requirements, with minimum structural changes. ously mentioned, definitive boundaries are one of the The paper stresses how these micro-interventions can main obstacles to emergent synergies between different have a huge incremental effect on the metropolitan activities and between private and public spaces. scale. Within the analyzed case study, they can become powerful agents of adaptive reuse of the existing ur- While point one mainly concerns the action of public ban fabric, thus reducing the need for urban expansion administrations and urban designers, points two and three across the countryside. 47 include the work of architects and interior designers for pri- 2. the construction of new buildings and precincts ac- vate investors. cording to emergent activities and needs. These trans- formations are slower than the previous ones, but also Learning from places: understanding and managing crucial for the evolution of the existing urban fabric as multi-scale adaptive cycles in the contemporary well as for the quality of urban growth across the ter- COSMOS + TAXIS + TAXIS COSMOS metropolis ritory. The Multi-Scale Atlas highlights how the new The present paper presents the Multi-Scale Atlas as a tool for buildings and activities can foster emergent diversity understanding complex diversity cycles across the wide ter- or its self-destruction according to their position across ritory of the contemporary metropolis and it stresses how the existing urban network and the design of their ac- this understanding is crucial for informing every design- cess and public-private interfaces. planning strategy which aims at cooperating with emergent transformations. In actual fact, such design strategies are The second level concerns the ability of the public ad- inspired from the self-ability of existing urban environ- ministration to establish a frame (both spatial and norma- ments to remain dynamic, adaptive and diverse. The idea is tive) which can guarantee that the unforeseen individual to interpret the inventions that life brings to the city every interventions of the first level foster city diversity, without day and to work as much as possible with (and not against) the need to over-control the development of every single the place-based forces which shape them. By accepting the project. The normative frame is not explored in this pa- city (and its inhabitants) as co-authors of their project, such per, although it is considered crucial to foster and manage designers also agree to limit their interventions as much as city complexity (Moroni 2015). The spatial layout requires possible. the ability (on the part of urban designers) to shape a ba- The multi-scale approach presented in this paper high- sic infrastructural network (streets, transports, parking lots lights how such strategies entail a deep understanding of size and distribution, water and energy networks, parks, cross-scale effects and how the multi-scale atlas can inform public buildings for activities such as schools, hospitals, this understanding. The Atlas highlights the presence of etc.), whose stable structure provides the basis for balanced two main levels of understanding (and consequently of in- transformations without needing to pre-define them. Such tervention) and makes it easier to explore the dynamic be- designers must accept that their project represents the be- tween them. ginning of a transformation, rather than its final stage.
Detecting and Directing Emergent Urban Systems: a Multi-Scale Approach ------success fosters an ardent competition space for and the locality dominating few uses develops, emerge: (3) the winners the of competition only represent a nar segment the of row many uses which together gener visuallyated success, (4) and functionally, the place and thebecomes loses local monotonous its appeal, (5) apartand suddenlycomes releaseundone. The phase is brief and chaotic, the but destruction that ensues has a creative tightly element: bound capital is released, and all options are open. Thisphase leads quickly a into phase reorganization of and renewal. arises Novelty in the new inventions, form of creative ideas and people. The point in managing adaptiveand cycles becomes a largethen collapse prevent to how in the late con servation phase. The strategies elaboratedby clever managers usually consist in undoing the of some con straintsthe of conservation phase, in navigate to order gracefula passage throughthe growth phase,without falling intorelease a phase is costly (which and un pleasant and involves the loss capital) of (Gunderson and Holling 2002; Walker and Salt 2006). Managers understand who cross-scale effectsoften release a phase avoid the at scale concernof generat by ing release and reorganization scales, phases lower at thereby preventing a late conser of the development vation phase the at scale and concern of (Gunderson Holling 2002; Walker and Salt 2006). describes this self-destructionJacobs (1961) cycle in six a diversified mixturesteps: (1) of usesplaces at some becomes a popular and successful the assemblage, (2) These cycles describe a social-ecologicalhow system organizes itselfresponds it and a changingto how During world. the RapidGrowth, compo the system’s arenents weakly interconnected, and its internal state isweakly regulated. This is the timefor innovation and growth. The transitionto the conservationphase occurs because the system becomes strongly more in terconnected and regulated: different of waysperform ing the same function are (redundancy) eliminated in performingfavour of the function in just the most ef The ofcost efficiency a is lossway. ficient in flexibility: such a system is increasingly a decreas stable, over but ing range conditions. of In other words, its resilience declines.a small Under breaks web shockthe system’s 2 3 NOTES 1 ------
Finally, the paper highlights present the importance Inthis respect, multi-scalea the how paper shows under While a good structure (spatial mini and normative) common good. This willhopefully increase the potential cityfor diversity across the heterogeneous landscapes our of everyday lives which are in a continuous state becoming. of is considered an essential part any of planningand design process which aims channel to the enormous quantity of individual initiatives that our cities contain toward the creativedesign strategy which is intended cooperate to with place-specificemergent transformations foster and their positive In evolution. this respect, a multi-scale approach derstanding the of dynamic interaction between parts and between whole, micro and macro scale, between spatial de tails and larger is crucial phenomena, informing to every of understanding of and detecting the multi-scale nature of in space. highlights phenomena It emergent an how un of individualof performances, even if each them of is a cer of tain quality, does necessarily not guarantee the collective quality the of common good. strategies which can channel a positive direction) (in the enormous quantity individual of (place-specific) energy that is concentrated in cities. In actual fact, the sum simple versity, thus invertingversity, a negative cycle. standing is necessary shape to every design and planning vidual activities and businesses toward the existing urban fabric. This strategywould turn spontaneousthe economic vitality spreading across the territory di of into a generator initiative its inhabitants. of In the Oltrepò the Multi-Scale Atlas a better how shows integration between the and slow fastnetwork connections of could indi re-orient emergent costs also because the new metropolitan connections fos tered the existing micro-economic network, thus increasing the ability a place through of regenerate to the individual wide network connections of and related public services. This strategy also it made to possible minimize economic minimum interventionsand with theminimum waste of economic resources. In Medellinthe small-scale problems specificof slums mainlywere dealt withrevisingby the diversity cycles. This understanding is crucialto framing the scale the thus of problem, informing any revision the of network,which aims inverting at negativea cycle, through the territoryneed be to constantly monitored, in to order the self-destructionprevent Atlas, The diversity. of in this respect,read offerstool to a these cross-scale effectsand mizes the need every control to single intervention, the cross-scale effectsof these incremental changes across VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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ity’s suitability, even for predominant use, declines, (6) 10 In Medellin the creative solution consisted of using an the place becomes marginal. established technology-generally associated with ski 4 Since the early studies of Jane Jacobs (1961) and and tourist sites—as a means of public transport. Christopher Alexander (1965) it has been clear how complex urban orders emerge in the interac- REFERENCES tion between subjects and objects in space and time (Porqueddu 2015). Alexander, C. 1965. A city is not a tree. The Architectural Forum, 122 5 Jacobs (1961) already stressed the importance of the (April-May); Reprinted In: Stout, F., and LeGates, R. (eds) (1996) The city readers. London: Routledge, pp. 118-131. part-whole dynamic. She described the “ballet of good Allen, P. M., and Sanglier, M. 1981. Urban Evolution, self- city sidewalk” as a complex order made up of move- organization and decision making. Environment and Planning A, ment and change, “an intricate ballet in which the in- 13: 169-183. dividual dancers and ensembles all have distinct parts, Amin, A., and Thrift, N. 2002.Cities: Reimaging the Urban. Cambridge: Polity Press. which miraculously reinforce each other and compose Boelens, L. 2009. The Urban Connection: An Actor Relational an orderly whole” (50). Approach to Urban Planning. Rotterdam: 010 Publishers. 6 The Multi-Scale Atlas shows that density in terms of Castells, M. 1996. The Rise of the Network Society, The Information Floor Area Ratio does not necessarily foster city diver- Age: Economy, Society and Culture. Oxford: Blackwell. Christiaanse, K. 2009. The Open City and its Enemies. In sity. Across the case study, maps show how dense and Christiaanse K., Singler J. and Rieniets T. (Eds.) Open city: compact settlements can be less diverse and vibrant designing coexistence. Amsterdam: Uitgeverij SUN, pp 25-35. than low-density settlements (Porqueddu 2015). On the Christiaanse, K., Singler, J., and Rieniets T. (Eds.) 2009. Open city: other hand, it has been demonstrated that dense urban designing coexistence. Amsterdam: Uitgeverij SUN. Corner, J. 1999. The Agency of Mapping. In Cosgrove, D. (Ed.) environment can be totally lacking in city diversity Mappings, New York: Reaktion, pp. 213-252. 49 (Dovey and Symons 2014). Dávila, J. D. (Ed) 2013. Urban mobility and poverty: Lessons from 7 This approach is based on the idea that, in the contem- Medellín and Soacha, Colombia. London: DPU, UCL and porary metropolis, diversity emerges according to the Universidad Nacional de Colombia. De Landa, M. 2006. A New Philosophy of Society: Assemblage Theory distinct mixture of both local and wider flows inter- and Social Complexity. New York: Continuum. secting at specific points in time (Massey 1994). Deleuze, G., and Guattari, F. [1980] 1987 A Thousand Plateaus. COSMOS + TAXIS + TAXIS COSMOS 8 In this respect, the Atlas highlights how the problem London: Athlone. is not to establish whether the increasing distribution Dovey, K. 2010. Becoming Places: Urbanism, Architecture, Identity, of these metropolitan attractions across the territory Power. New York: Routledge. Dovey, K. 2012. Informal Urbanism and complex adaptive is positive or negative. The existing local debate is of- assemblages. International Development Planning Review, 34(4): ten confused and polarized: on the one hand, the new 349-368. hubs are considered responsible of the death for his- Dovey, K., and Wood, S. 2015. Public/Private urban interfaces: type, torical centres because they attract flows of people out adaptation, assemblage. Journal of Urbanism 8(1):1-16. Dovey, K., and Symons, F., 2014. Density without intensity and of them. On the other hand, it is clear that these new what to do about it: reassembling public/private interfaces in activities witness a certain vitality and foster emer- Melbourne’s Southbank hinterland. Australian Planner Journal, gent flows across the network of small settlements. The 51(1): 34-46. multi-scale maps show that their emergent presence is Duany, A., Plater-Zyberk, E., and Alminana, R. 2003. The new civic art: elements of town planning. New York: Rizzoli International positive, while their position and spatial layout can cre- Publications. ate problems. The question then becomes: how to turn Echeverri A., and Orsini, F. 2010. Informalidad y Urbanismo Social these emergent forces into generators of diversity? en Medellin. In Hermelin, M., Echeve, A., and Giraldo, J. (Eds) 9 In this respect, the local debate is often confused and Medellin: Medio Ambiente, Urbanismo y Sociedad. Medellin: Universidad EAFIT. contradictory. The restrictive rules applied to historical Gunderson, L., and Holling, C. (Eds.) 2002. Panarchy. Washington: centres are in contrast with the widespread intention to Island Press. protect the beautiful local landscape and to reduce soil Harvey, D. 1990. The condition of post-modernity: an enquiry into the consumption. In actual fact, they indirectly encourage origins of cultural change. Cambridge, MA : Blackwell. Ikeda, S. 2017. A city cannot be a work of art. Cosmos+Taxis, 4 (2+3): the diffusion of the new activities across the country- 79-87. side outside existing settlements. Jacobs, J. [1961]. 1992 The Death and Life of Great American Cities. New York: Vintage Books.
Detecting and Directing Emergent Urban Systems: a Multi-Scale Approach
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Minneapolis: University of www.richardsennett.com, accessed . , Cambridge, MA : MIT Press. Resilience Thinking Complex adaptive systems . New York: Scribner.. New York: Self-Organization city the and Emergence: The ConnectedLives of Ants, Brains, Space, Place and Gender. Libertà e innovazione nella città sostenibile Good city form 14(3): 248-267. 14(3): 20(2): 169-192. 169-192. 20(2):
Ecosystems and People in a Changing World. Press. spatialcomplexity.info/files/2013/10/Portugali.pdf July15 2016. 5 May 2016. Theory Carocci editore. Design research emergent for urban systems. Cities, and Software Cities, and Minnesota Press. Princeton University Press. and prediction: Urban codes self-organising for cities. Walker, B.Walker, and Salt, 2006. D. Sennett, R. The Open 2013. City Porqueddu, E. (forthcoming). the Towards Open City. Design and Portugali, J. 1999. Portugali, What J. 2013. makes cities complex? Porqueddu, E. Intensity 2015. without density. Moroni, Complexity S. 2015. and the inherent limits explanation of Moroni, S. 2015. Massey, 1994. D. Miller, J., and Page, S. 2007. Johnson, S. 2001. Lynch, K. 1984. VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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Connecting the Dots: Hayek, Darwin, and Ecology GUS DIZEREGA
Email: [email protected] Web: http://dizerega.com
Abstract: Social institutions viewed from a Hayekian perspective closely match evolutionary and ecological perspectives in biology. All rely on the same systemic relationships of variation, selection, and inheritance. What Hayek called spontaneous orders are variations of a larger range of related phenomena. Concepts developed in one such field can enrich our under- standing of analogous phenomena in others. Among the most important concepts explored here are individuals, organisms, species, and ecosystems. This integration carries important implications for how human societies can exist sustainably on the earth.
Keywords: Aldo Leopold, biology, Darwin, ecology, ecosystem, emergent order, evolution, Geerat Vermeij, Hayek, individu- ality, invisible hand, meme, organism, organization, spontaneous order
…modern ecology is…the creation of two groups… rather than the change from one species to another along a The one studies the human community almost as if it given trajectory. Although these basic principles have been were a separate entity, and calls its findings sociology, greatly refined and developed since 1859, no subsequent sci- 51 economics, and history. The other studies the plant entific work has challenged Darwin’s core insights. and animal communities…The inevitable fusion of Earlier observers thought they saw similarities between these two lines of thought will, perhaps, constitute the the economy of nature and the economy of a household, outstanding advance of the present century. and assumed a higher authority was responsible for both.
Recognizing these same similarities, today many natural + TAXIS COSMOS Aldo Leopold, A Sand County Almanac and some social scientists suggest they arise from social and natural invisible hand phenomena. Variation, selection, This essay integrates the study of social institutions from a and inheritance are common to all, but the nature of the broadly Hayekian perspective with evolutionary and eco- variation, the principle of selection, and how inheritance is logical perspectives in biology, arguing all rely on the same passed on, are specific to the order we are examining. So systemic relationships of variation, selection, and inheri- how far can we go in exploring these systemic similarities? tance, albeit in very different contexts. Hayek’s “spontane- Biologist Geerat Vermeij argues we can go quite a ways, ous orders” are important examples of this much larger writing “Perhaps evolutionary theory and the long record range of related phenomena. Consequently, we may learn of life on earth might reveal insights that political scientists, more about any of them by exploring research of analogous psychologists, and historians . . . have missed” (Vermeij processes in another. 2010, p. 60). I believe Vermeij is right, and this paper will Evolutionary theory rests on three insights that, in differ- seek to build on his argument from a social scientific direc- ent words, are often applied to the social sciences of complex tion. phenomena: variation, selection, and inheritance. When variations appear in organisms within a particular envi- ronment, some survive better than others, with the most DISCOVERY PROCESSES successful leaving more descendants. As they do they pass their advantageous traits on through their offspring. This Hayek described competition as a discovery process, and is the evolutionary process. Ecological theory utilizes these explored this way of looking at it from a market and a scien- same insights from a different perspective, emphasizing tific perspective (1978). His insight applies to both biological relations between different species within a given network and social invisible hand phenomena. Be they innovative
Connecting the Dots: Hayek, Darwin, and Ecology ------While many organisms’ absence presence or has little The The sameobservation applies in society. When the cityof As in social systems, successful adaptations are usually rent control was control student reduce rent to populations, replacing themwith young professionals with spend to money more and interest more in eatingresult The out. wasburgeon a ing creative of restaurants while the population control rent was intended assist to declined (diZerega 2000. 311-14). pp. impact the on ecosystem they inhabit, if in an organism’s fluence is strong enoughitspresence can transform one NATURAL AND SOCIAL NETWORK EFFECTS NETWORK AND SOCIAL NATURAL Because they are networks, when acting within ecologies Garret Hardin emphasized cannot we only thing do one As(Hardin with 1986). social invisible hand phenomena, everything is linked with everything else in networks of relationships. these of Some linksare weak othersbut are strong, and often we have littleidea what onesthe stronger are until disrupted have we them. example, For Japanese no imaginedforester cutting coastal forests would significantly harm ocean fisheries,or harmeven at them all. a ma When rine chemist then discovered decomposing from leaves for ests significantlyfertilized plankton, replanted treeswere in coastal places. Where this was fish done, oyster and har vests increased These (Robbins 2002). kindsnetworkedof relationshipsevery go Scientists which way. studying Pacific Northwest forests discovered returningbodies salmon’s anwere important source nitrogen, of enhancing forest growth,which in turn enhanced suitability the region’s for sustaining salmon (Helfield 2001). control, neitherBerkeley critics adopted rent advocates nor imagined its impacts of one would be make to Berkeley a “California for center cuisine.”long-term influence The of marginal, such as a species gradually developing greater speed resistance sometimes or a pathogen. to However, these changes will be deeply transformative, as when the grasses of evolution made the rise tropical of savannah eco systems possible the at expense 2011). forests of (Stromberg the changePerhaps most profound is species when some new ways organizingdevelop of themselves, such as the so cial insects individually who are small and vulnerable and whoseancestors largely were solitary. individual Most so cial bees and all ants are less viable than their solitary an cestors, as societies however they among are the now most successful We life ever evolved forms (Wilson have to 2012). human beings are the most extreme earthly case ecologi of cal transformation caused this by process. ------Vermeij quotes quotes Vermeij
The same patterns appear in biology. The The sameobservation applies in science, where, Successful hypotheses fall along a continuum between
Vermeij explains, in general isVermeij the “Adaptation formation, and continual testing, hypotheses of the about environ 2004, 26). p. ment” (Vermeij for its predictivefor value and modifiedby adaptation a for 2004, better Over p. time26). fit” new develop (Vermeij arise ments basedthose on that previously have succeeded. Wolfgang Steerer arguingWolfgang organism represents a hy “An pothesis its environment, of continually tested selection by more or less or rathermore than two distinct categories change. of made theI have same distinction regarding policy innova tion within democracies 454-7). (diZerega 1988, pp. discipline while challenging not the larger scientific con sensus within which exists. it The theoryof continental drift is an example. Againwe observing are a continuumof discovery relativity of and quantum mechanics, and previ withously, Darwin and Other evolution. discoveries can fall in somewhere the middle, transforming a particular ever more questions.ever more discov Sometimes,a major however, erytransforms scientists how think what about had once seemed settled knowledge, as happened in with physics the (Schumpterian) and “normal” (Kirznerian) science (Kuhn and(Schumpterian) “normal” (Kirznerian) science (Kuhn Scientific 1996). knowledge usually increasesits at edges as theimplications existing of theories are applied explore to plans while having an arbitrage dimension aswell. ThomasKuhn distinguished between“revolutionary” neurship, the process destruction” “creative of (Schumpeter actual Most entrepreneurial1961). projects fall somewhere along a continuum between these models, disrupting some Kirznerian arbitrage entrepreneurship: alertness oppor to tunities successful for market transactions (Kirzner 1973). other The pure end is Schumpeterianpioneering entrepre marginal changes and something truly In economic new. theory such a continuum of end can one be described as new hypotheses can arise be to tested in turn and possibly thatreplace one been had long dominant. potheses acquire systemically defined resources money, of acceptance scientists, by votes, offspring, or and flourishso Within any these of (diZerega processes, 2010). any at point the systemic contexts which on they depend. has There to be a successful fit between the “hypothesis” and the system constraintsic within which is it evaluated. Successful hy products, scientifichunches, politicalproposals, newor spe cies; variations ways existing of on within such systems are kinds hypotheses of that are then subjected evaluation to by VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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ecosystem into a different one, as happened with the evo- age short diverse blocks could be described as a keystone lution of grasses mentioned above. Their physical size is feature of vital urban ecologies (Schiller 2016). not important. Grasses are smaller than trees. But the net- works they influence are very important. Being grazed of- BLURRING BOUNDARIES ten kills small trees, but because they grow from the bottom up, grasses are little damaged, and many even thrive on it. Most of the time we describe biological ecosystems as if In ecological studies, species whose presence or absence they possessed clear boundaries, as I just did when describ- changes the broader ecological patterns are called “key- ing the Pacific Coast forest ecosystem. But in fact, all eco- stone species.” For example, salmon are a keystone species systems are integrated into the larger biosphere, the total in Pacific Northwest forests, even though they are rarely ecology of life on earth. Boundaries between the ocean and present (Grames 2012). land, forest and savannah, or a lake and its surroundings We see the same patterns of networks and stronger or are porous, sometimes very much so, as those Japanese sci- weaker links in society. Cities are social ecologies consti- entists discovered. But for most purposes the “ecology of tuted by intricate networks of relationships. Jane Jacobs fa- life” is too complex to comprehend, and so scientists look mously argued the nature of city blocks had a large impact at smaller sub-systems, such as coastal rain forest or arctic on a neighborhood’s safety and social and economic vital- tundra, as reasonably unique in themselves and hope to dis- ity. Small diverse blocks encourage varied pedestrian use cover patterns that might also exist elsewhere, or perhaps because they are more pleasant places to walk. Pedestrians encounter something new to science. add to the attractiveness of a neighborhood, and provide Ecosystems’ boundaries are determined by the questions constant observations of what happens on the streets, in- we ask. The Pacific salmon ecosystem overlaps with that of creasing public safety. They promote a diversity of social Pacific Northwest rain forests but raises different questions 53 networks. Short blocks are more than simply an ‘inefficient’ for research. When studying the Amazon rainforest, usu- street layout for car transportation. Increasing the speed of ally an ecologist does not need to pay attention to wind- traffic flow by widening streets and creating longer blocks blown dust from parts of Africa, but for other questions this discourages these other positive urban features, degrading a more inclusive frame is important because the dust is a ma- city’s social and economic health (Jacobs 1961, pp. 112-40). jor source of phosphorus for earth’s largest tropical forest COSMOS + TAXIS + TAXIS COSMOS Imposing these requirements from above is like converting (Yu 2015, p. 42). a natural forest to a plantation, where a complex network is Again, the same pattern exists in the social world. The subjected to a hierarchy of priorities, in this case facilitating market order is the network of products and production traffic flow above other values. that incorporates all that is bought and sold. Science grows Vancouver, British Columbia, is usually described as one in complexity as new discoveries open up additional fields of the most livable cities in North America, if not the world. for exploration. Neither the market nor science are coter- Vancouver’s urban policies generally reflect Jacobs’ and minous with the social world. We can select out subsets others’ insights about vital neighborhoods being more im- of social ecosystems such as markets or science for study, portant for urban well-being than encouraging rapid trans- but in reality, as with natural ecosystems, they interpene- portation. They cultivate a vital urban ecology. The wisdom trate. The boundaries we perceive arise from our questions. of these insights has been confirmed for many decades Markets, science, and other spontaneous orders in Hayek’s (diZerega and Hardwick 2011). sense combine and interpenetrate in the larger social world Short blocks are not the only factor encouraging urban we call civil society (diZerega 2014). vitality. Jacobs argued dense mixed use neighborhoods populated by people of varied incomes had a similar im- INDIVIDUALS IN BIOLOGY pact, again by increasing the variety of interactions. High- rise apartments surrounded by open space, no matter how The same kind of relativizing and blurring of what were park-like, inhibited the growth of social networks, reduc- once considered reasonably distinct ecosystem boundar- ing a region’s ability to support and nourish rich human ies is also being discovered in the organisms within these relationships and increased crime. As in natural ecologies, systems. To focus initially on nature, over time the ecology complex network effects existed at every level (Scott 1998). of life tends to become increasingly complex (Vermeij 2004, However, due to the networks of relationships they encour- pp. 252-4). Growing differentiation creates possibilities for
Connecting the Dots: Hayek, Darwin, and Ecology ------social indi and not all social individuals are . Each kind ecosystem of its develops From a humanFrom view point of many organizations re Geerat Vermeij helps us helps here, arguingGeerat Vermeij in economic sys The keyto the analogy between species and occupa tions lies in the that roles these entities in play the sys temsin which they live. The conditions of life create a regime selection of that yields adapted individuals whosephenotype observable [its features]reflects not just ancestry and themeans which by species some can apart be told also but from another, one the ways lifeof the members are lead to thanks able heritable to adaptations. Similarly in human society, occupations phenotypeshave that allow us identify to and clas sify individuals economically. Like species. (Vermeij, 2004, 45) p. insight occupations, about Building orga Vermeij’s on Species are collections individualsof with common traits to thisto insight is focus to the on relationships (occupations) rather than the biological individuals (human beings). slimesemble molds. the of Most time slime exist molds as individual amoebae living separately thefor on of a floor should conditions deteriorate,est. they However, combine together into a larger accomplish to able “slug” what they species distinction Is there be to important (Stamos, 2013). a social-ecosystemic equivalent biological to species? tems an is like ‘occupation’ ‘species.’ a nizationsare like organisms complex different where spe symbioticallycies professions of accomplish combine to what they could achievenot themselves by (diZerega, 2015). There manyare biological equivalentsto this kindrelaof tionship,such as lichens, slime molds, and corals. The key INDIVIDUALS IN SOCIETY INDIVIDUALS Humanbeings are biological individuals viduals. In nature most biological individuals are social not in our sense having of a culture and division labor of and knowledge. They are two different kinds ofindividuality. I want suggest to in turn that biological individuals own kinds individuals of and species, and individuals in the socialthan include more world think what we as of in dividual human are beings. its only biological We compo its only not social but nent, component. that, the on maintain whole, their distinctiveness from oth er species.seen, As have the we boundaries between biolog ical species arerigid, not they but are strong enough the for ------called the “wood wide web” (Helgason Nature
Thisrevision biologicalof individuality deepenhelps our Inall these cases boundaries between organisms remain, Bacteria are a different kindof individual entirely. Thisblurring once of taken for granted boundariesgoes Sometimes a species will existed have so intimately with
similar balls. similar understanding in it of the social world. viduality is certainly real, emerges from inter but a node of secting relationships rather than existing as kind some of psychological biological or billiard ball separate from other sometimes only contextual. In terms our of own biology, increasingly scientists call us “ecosystems” (McFall-Ngai Our indi organisms” 15). “super or p. (Milius 2014, 2013) Individuality in any strong sense does exist. not but, depending the on issue hand, at they can be porous and forth allowing resistance antibioticsto rapidly to spread through a population. The betweenborders individual bacteriaopen arethan more they are in eukaryotic cells. least two distinct organisms (Margulis 1999). Individual‘species’ bacteria of can trade back and DNA be far common than more imagined. once the Even eukary oticcells makingour up bodies and the bodies all of other multicellular organisms are at once composed what were of other they become a separate individual in their own right, as with the partnership algae of and fungi call we a lichen. In years, recent these relationships been have discovered to still further. considered individual What long have we or ganisms are individuals not in the thought. we way In some cases, distinct organisms an become one so on dependent isms, as with yucca moths and yuccas, each needs whom of the other reproduce. to another its so members can long for live indepen longer no aswith dently, fungi some antscultivate andthe corn we cultivate. This dependency can embraceeven bothorgan (Schmidt 2015). (Schmidt 2015). 1998). There There manyare similar 1998). even We have examples. discovered varieties bacteria of within our guts can make good health possible, and influenceour minds for the better birches. In the winter the produce to leaves no birch have and re energy, The receive nutrients from firs(Frazer 2015). sultis what gus, that links them their at roots. Each sends carbon the to other during stressfulperiods. During the young summer, firs suffer ifthey are inthe shade, and receive aid from new kinds biological of integration. example, For two very different speciesof tree,birch paper Douglasand co live fir, aided yet anotheroperatively, by species, a mycorrhizal fun VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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cannot individually. In their new collective relationship in- Far from needing expression by biological organisms, in- dividuals act differently than when they were separate from creasingly many occupations are being performed by ro- one another, including self-sacrificing behavior in service bots, and organizations increasingly prefer the latter. to the larger entity. Yet in many slime molds their individ- Civil society contains many different kinds of organi- ual cellular boundaries remain, and if conditions improve zations: sole proprietorships, partnerships, family owned the larger ‘slug’ dissolves again into individual amoebae concerns, cooperatives, research teams, churches, charities, (Cellular Slime Molds). The relationships between slime sports teams, universities, political parties, and corpora- mold amoebae shifts between one kind of individual to an- tions. Each kind of organization brings different strengths other. Is the amoeba an individual organism? Is the ‘slug’? and weaknesses to its task. Some are specialized to flour- Are they both? ish in science, some in the market, some are profit oriented Applying this perspective to society, occupations come and some are philanthropic. Some members within an or- together to form organizations to accomplish what they ganization are tightly linked, as in a sports team, and some could not achieve singly. Individual human beings are ex- are loosely linked, as in a university. Because it best facili- pendable so long as the occupations they practice are per- tates individuals coming together to cooperate for common formed by another. ends, civil society is the richest and most diverse social eco- Should the organization cease to exist, many occupations system for organizational species. can still survive on their own. As with a slime mold, human If organizations in a social ecology are like organisms in beings will behave differently on their own than they other- a biological one, we will gain in understanding by viewing wise might when part of a strong organization, a phenom- them as subject to similar evolutionary pressures leading to enon behind some of our most heroic acts, and also many of differentiation and adaptation. Organizations seek to suc- our most despicable (diZerega, 2015). But what makes them ceed within an environment shared with other organiza- 55 a part of the organization is not their individuality but their tions, each shaping that environment to some degree and performing essential occupational functions. Thus, the or- in turn shaped by it. There are producers who seek systemic ganization is an organism composed of occupational re- resources and are then subject to predation and parasitism lationships shaped by the context within which they exist as well as scavengers who reconstitute organizational re- together. sources into more viable forms. There will also be keystone COSMOS + TAXIS + TAXIS COSMOS Like occupations, organizations seek their goals in a organizations as well as others that play a far less important larger selective environment that imposes constraints as role in shaping a social ecosystem. Like a life form, each can well as offering opportunities to flourish. As with success- be understood teleologically ful occupations, successful organizations adapt to handle Distinguishing occupations and organizations from the their environmental constraints as well as exploiting their human beings who embody them sets the stage for a final opportunities. Like an organism they can evolve and adapt. step in grasping how civil society can be understood as the Organizations are complex non-biological organisms exist- most complex ecosystem ever to have arisen on this planet. ing within the social ecology. Institutions, be they organizations, occupations, or other patterns of relationship we engage in are cultural, not bio- Civil society as ecology logical, phenomena. And cultural phenomena are main- The model I am developing sees civil society as an ecology. tained or changed by how we think about them. On the one hand, because we are biological beings, civil so- ciety is a part of the ecology of biological life. But it is also The extended nature of the human mind a network of voluntary cooperation, shaped by and in turn We evolved in a chain of descent probably going back at shaping human ends. Their strongest strands are the invis- least 3.8 billion years (Rosen, 2015). We express this heri- ible hand phenomena of markets, science, democracy, and tage in at least our metabolism, our senses, and our physical other spontaneous orders. Now we are seeing another di- needs. Today scientists are learning this deep earthly root- mension to this network: organizations and occupations edness even shapes our psychological well-being and the comprise species that to some significant degree can be sep- conditions for maintaining physical health (Maller, 2006, p. arated from their biological identity as human beings. Of 45-54; Williams, 2017). We are more intimately connected course, they work through human beings, but they can in to this planet than the abstractions of ‘economic man’ and turn actively shape the human beings who comprise them. ‘rational action.’ can ever grasp.
Connecting the Dots: Hayek, Darwin, and Ecology ------Ideas manifest in the material influencing by world our Institutions are quite like not ideas. They patternedare Dawkins famously compared genes, memes to argu thisFrom perspective ideas are like organisms requiring Mind in this inclusive cultural more sense constitutes an portive environment. As withinbehavior. elements a culture, ideas influence the throughworld the medium the of guided people them, by shaped the by institutional framework within which they act. ways doing of things that also shape our perception what of Memes and institutions Richard Dawkins’ describes term “meme” an idea that en ters into culture and can then shape as well as be shaped by it. As a kind such memes have ‘objective’ existence of in the sense Berger and Peter ThomasLuckmann used termthe culturefor as both a human creation and an objective re They exist independentlyof any 61). ality p. 1967 (Berger, particular subjective mind, and need those minds repli to cate. Successful memes influence sometimes behavior, pow erfully. inglike they genes adapt, flourish, and die, in their case through our success failure or in incorporating them into our lives I think (Dawkins, 1989). equating memes with isgenes a most useful heuristic, and perhaps considerably thanmore that. As memes, ideas in the sense broad adapt, spread,through die mutate or their interaction in sociala ecosystem. mental ratherthan physical energy from flourish. to people Ideas this compete for mental support because lim have we ited attention give to them, and the most successful often form symbiotic relations with others. support, Without an idea“dies,” perhaps goes or dormant awaitingsup more a senting objects, actions, and, ultimately, thoughts and cal culations and called the 2016). codes (Wolfe, words” its own of with order emergent its own variation, selection, and inheritance, in one important respects distinct from the in orders the biological example, For world. language enablesthe inheritance rapid acquired of characteristics, and that inheritance can from come any personis who able passto be or imitated on regardless another, by biological of connections. If sex speeded and evolution up adaptability mixingby two genomes, language does so mixing by the insights countless of individual minds.ideasof world The operates in important respects in different ways thanother ecological processes, with but the same abstract principles underlying them. ------our intelli outside we are we do know Individual
Tom Wolfe writes “language conclusions Everett’s Wolfe of had Tom Based with work on an unusually isolated Amazonian Our minds than more consist much of what our indi Human intelligence comes with instincts few ori to able Rather smugly, we attributeRather we smugly, our disproportionate influ Yet all us of areYet aware also we differ from rest of the na
sounds and them put together in the codes form of repre not evolved fromnot . . . anything. was It an artifact. as Just man had taken natural materials, wood and namely, metal, and combined them create to the axe, had he taken natural ture and language are the foundations human for reason and understanding 2012). (Everett, 2017; ture. an is not It artefact biological of rather but evolution, cultural of the by need promoted communi to evolution, cate effectively quickly. and LikeEverett Hayek, argues cul tribe, linguist Daniel demonstrates newest work Everett’s rather thanhow, having an innate instinct language, for as has been long thought, language evolved along with cul millions minds of constantly absorb and modify parts it of 157). p. 1979, (Hayek, p. 17). Hayek elaborated “ [M]ind can exist elaborated Hayek only[M]ind “ as part 17). of p. another independently existing distinct structure order, or although that persists order and can only develop because a product of thea product of social environment in which has it grown andup which has it made as not something that has in turn actedand upon altered these institutions.”(Hayek, 1973, vidual intelligence can discover create. or They also include our cultural inheritance. it, “Mind put As is Hayek as much benefiting from and occasionallymodifying achievements greater a of intelligencelocated in relationships physical bodies rather than inside our heads. two run to and run many to more fast. If infants needed to be quiet survive, to would be we extinct. is gence real enough,is primarily but usefulthe on margins, ent us inent the If world. necessary, a newborn fawn can soon run. that Absent necessity knows it lie to quietly avoid to predators. A human baby will normally take a year walk, to cleverer, but not in not the but us most way of likecleverer, imagine. to ence over otherence over life forms our to intelligence. as But we usually think our about intelligence, are are we wrong. We increasingly influencing global ecosystems and even the distinctly, more Even geology. we world’s ing so. bacteria archaea or living deep underground, in undersea deepvents, or in thermal pools. Our era is increasingly called the anthropocene because in important are ways we ture.region no of There is the earth where life has not been significantly affected by human action other than perhaps VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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to do and how to do them. Institutions ‘tell’ us how to do time. The rules of the market and of market oriented orga- things but not what things to do, even if their own values nizations can apply to either relatively uncreative activities, influence our actions somewhat independently from our in- such as supplying a market niche with a product that does tentions. They shape and coordinate our dealings with oth- not change, or to innovative and inventive companies. For ers, and so usually magnify our power to act in the world example, markets can coordinate building buggies, cars, while also channeling and shaping that power. They can be and rocket ships but the ideas for what to build must come supported by memes, but are not themselves ideas. from the outside. In civil society, language, science, markets, democracy, I distinguish between institutional and ideational ecosys- a variety of organizations and many other elements of our tems because how ideas manifest is powerfully shaped by lives such as what constitute a family and what it means to the institutions in which they act, just as these institutions make a contract are institutions. Some arise in an evolu- can be shaped by them. While ideas and institutions mutu- tionary way, the product of our actions but not our design, ally influence one another, for some purposes we can treat others are deliberately created and found useful enough to them as different.The human relation with the rest of nature persist until they take on a reality independent of their cre- is one of them. ators. These institutions shape and coordinate our dealings We can learn from many people, reconfigure what we with others, to some degree independently of our inten- learned, and adapt at a speed making it possible within a tions, and as such magnify our power to act in the world single generation’s lifetime to change from a society where while also channeling and shaping that power. horses were still common and cars a rarity, to one where In Berger and Luckmann’s terms, like institutions, memes we watched a live broadcast of the first man to walk on the take on an “objective” independent existence. (Berger, 61) moon. But when that walk occurred no one imagined the Initially we encounter them as a part of our taken for grant- interconnected world of today with its smart phones, inter- 57 ed world, where what it is to be a parent is as uncritically net and computers at everyone’s beck and call. The institu- accepted as true in the context of an institution as what it is tions shaping all this changed, but not nearly as much as the to be a rock in the context of its hardness. Some institutions ideas manifesting within them. are spontaneous orders and some are the organizations act- ing within those orders (diZerega, 2015). The big disconnect: institutions and ideas as cultural COSMOS + TAXIS + TAXIS COSMOS An institution is not necessarily a meme. If an institu- accelerators tion is questioned this questioning becomes a part of the In the biological world one close analogy to developing so- ideational ecology but need not impact how the institution cial institutions would be the evolution of eusocial collective operates. The market, for example, existed long before eco- societies by organisms that were once solitary, such as ants nomic theory and those who support it through their action or bees. While rooted in biological rather than social evolu- need not have any conception of it at all. Alternatively, the tion, their evolved way of life completely changed the roles influence of the market as a meme need have little impact these organisms play in the world. Many who study them on how it functions, which is independently of individual argue an ant colony in particular should now be considered intent or even awareness. Ideas exist separately from insti- a super organism, an organism distinct from the individual tutions, but each shapes the other (diZerega, 2015). ants who make it up, or perhaps a physical extension of the In its immediate impact on us the ideational meme-net- queen, as if our fingers could take leave from our hands but work dwarfs biological ecologies and evolution and is at still be subject to our intentions (Wilson, 2012). Eusocial in- least as powerful as the institutional ecologies of language, sects can be said to have genetically determined institutions markets, science, democracies, and civil society which but so far as we know they have no memes, which is per- shape how it manifests. If institutions shape how we go haps why they are relatively unchanging. We are obviously about acting and cooperating, this ideational ecology pro- far more able to learn and change our institutions than are vides the environment wherein we decide what it is we will ants, but in the modern world an individual could be said do. Institutions are not creative. with little exaggeration to know as much about the collec- Two examples help clarify my meaning. As an institution, tive mind of its society as an ant does about its. what we often call the “scientific method” can be applied Human beings have developed two conceptually distinct in similar ways over long periods but what counts as scien- and, in practice, deeply interrelated dimensions of non-bio- tific knowledge verified by that institution changes all the logical invisible hand phenomena we combine together into
Connecting the Dots: Hayek, Darwin, and Ecology ------
Ourcapacity substitute to plant animal or one anfor Human culture’s disconnection from nature is amplified Some societiesSome succeeded in living sustainably and oth pletion of underground pletionof aquifers. Like factorya that never reinvests any its profits of upkeep, naturalin operating ‘cap ital,’ such as soil is exhausted. and water, other weakens any purely instrumental incentive con to serve them. as substitute But we organism one another for usuallywe sodo based only their on utility as resources in the narrowly human and ignore world any they role play earliercivilizations has little agricultural value. North Africa breadbasket became after Rome’s Romans the im poverishedtheir own soil, today North but African soil is Egypt 64-7). pp. also 2007, degraded much (Montgomery, was saved from this because problem annual floodsby the Nile enriched the soil, than luck a matter of more wisdom. the to due Aswan DamToday the renews the Nile longer no soiland Egyptian farmers face the same less for problems tunately located farming civilizations had face. to Over the past 40 years the as has a whole third world lost perhaps one its arableof land, and be to around hope we thousands for years of (Milman, come to 2015). ourby unequalled capacity shift to resource one to from eliminatinganother, any reason conserving short-term for the first, whileavoiding naturalthe checks that keepother species from consuming completely their resource base. The earth’s forms,life the ecosystems sustainthat them, and its minerals all constitute our resource base. When one resourceis exhausted made extinct, or find we substitutes. In doing impact so we natural relationships so deeply as to transform ecosystem one usually into another, a far more impoverished short generate Alternatively, one, we term abundancethe at risk term long failure, of aswith the de depend is being threatened anthropogenic by global warm ing.global But warming is only the most extreme instance culturally of based disconnected power from natural pro cesses. normally Topsoil takes many years formand to can be wiped inout days. Coral reefs and forests kelp support important nurseries the and for shelter fishon which so many us of depend. They can be easily destroyed recov and their Given natural over power er far slowly. more processes in the short run and dependence their on health in the long, cultures run the risk destroying of the natural processes that support them. ers failed, all but societies face this challenge (Diamond, Viking2005). settlements died in out Greenland whereas the Inuit succeeded.fertile The of crescent agriculone is points origin,ture’s of today land but that sustained long ------ecosystem . The long- . The ideational
The natural ecosystemsthat support likemore us are red In both its institutionaland ideational dimensions, cul In terms the of language I am developing social here, in Biologically inherit we and genes degree some to the im
term viability ecosystems of around which the on we world efitting from theirpresence. woods and elephants than dandelions and mice Elephants, lions, whooping cranes, whales, redwoods, and increasingly, birds, song so well. not These beingsneed spe cial protection consideration or if are we continue to ben adapt specialized us, to more but reproduc slowly more or ing are ones a disadvantage. at Rats and mice, flies, bac teria, and dandelions pretty do well in the modern world. ture creates a deep disconnect between human life and the biological that world ultimately supports it. Rapidly repro ducing life forms exist to able as generalists can successfully institutional is evolution considerably Ideational faster. proceedsevolution the at speed thought. of selves. This system adapts fastereven thandoes the institu tionalecosystem. Biological proceeds evolution theat speed successfulof reproduction. With bacterial some exceptions, specialized beliefs. All these of meanings are rooted in their relationships with created have other such concepts. We an ecologicalmeaningof field withinour orientwhich we ideas, and severe. the is even here Culturally more problem developed and have we maintain an beliefsof from what “everybody shading knows,” more to stitutions are subject processes to change of and adaptation, quickly more much but than most such processes in biolog ical systems.other The of dimension mind is realm the of most part institutions and memes exist independently of individual human beings. that fit not do theirWe takevalues.mostof this institu tional framework granted, for sometimes seeking change to fromsome within the perspective the of others. the for But inheritsystems cooperation of and coordination, systems rewarding kinds some cooperation of and penalizing those pact previous of experiences from our parents and even greatInstitutionally grandparents (Interlandi, 2013). we a basic disconnectbetween the cultural in which world hu man beings most immediately live and the biological world that ultimately supports them. ports it. They are different ofdimensions the “mind”larger which makes possible our consider what and we empowers individual minds. Because they are biological, not there is what we broadlywhat we term Both “culture.” institutions and the ecology ideas of are unique human to society and so dif from it theferentiate biological that world ultimately sup VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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in their ecosystems. We act linearly in a nonlinear environ- Donald Leal. One deals with forests, the other with oceanic ment. fisheries. Michigan’s Kingston Plains once contained a large old The problem of ignorance growth white pine forest. After the forest was clear-cut and The more powerful a culture’s impact on its environment the land burned over, the forest did not regrow. Between the more foolish this approach becomes. Its implications the kind of logging performed and subsequent fires the soil duplicate arguments against market interventions such is now too poor for the trees to regenerate. Nor is the land as price controls: each intervention generates unexpected useful today for agriculture or recreation. To most people problems inviting another external intervention until its the way the Kingston Plains was logged would appear to be ability to coordinate plans becomes seriously crippled. a bad use of the land. The Scottish Enlightenment’s thinkers criticized people Anderson and Leal argue otherwise: thinking they could rationally reconstruct society. Within the same tradition, Hayek criticized imposing a hierarchy When the trees were cut, good timber stands in the of goals on the market’s invisible hand phenomena, arguing Great Lakes area were selling for around $20 per acre. efforts to override the price system’s coordinating abilities In order to determine whether it would have made with direct interventions such as price controls over some more sense to invest in trees by forgoing the harvest, or all market phenomena would backfire. Maintaining a we must consider the return on other investments. market order required not making short run interventions Had the income from selling these trees been invested to achieve particular goals if doing so interfered with the in bonds or some other form of savings at the time, it market’s feedback processes. The short-term advantages would now be worth approximately $110,000 per acre, would be clear and the future damages would always be un- or $2.8 billion for the forty square miles. . . . Because 59 clear and so in terms of costs and benefits,always be under the land in this area is not worth anything close to estimated. Were the results known, the interventions would this, we must infer that harvesting the trees was the usually have never have been made. correct choice. (Anderson and Leal, 2001, p. 43) Wes Jackson made the same point with respect to ecolo- gies: “Given that we have far more ignorance than knowl- Years before Anderson and Leal wrote their book, Garret COSMOS + TAXIS + TAXIS COSMOS edge about the workings within, the ecosystem becomes Hardin observed “At high rates of interest the present value the best conceptual tool to help us understand how to get of the distant future effectively vanishes” (Hardin, 1986, p. along in this world” (Jackson, 2008. p. 27). Neither Jackson 74). The old growth redwoods we treasure today are not nor Hayek believed nothing could be done to serve human 500 years old, the minimum standard for old growth trees goals better if market or ecological processes interfered of that species. They are at least 1500 years old. As Hardin with our well-being. However, they emphasized whatever observed, “He who finds ecstasy in the wonder of today’s we do should harmonize with the underlying dynamics of mature redwood forest benefits from a preservation a pre- a complex social or biological system rather than imposing Christian economist could not have justified” (Hardin, an external goal on it. To use an agricultural metaphor, in 1986, p. 75). both societies and nature, the technique for creating posi- The forest that once stood on the Kingston Plains were tive changes should be to encourage and cultivate rather considerably younger, but according to economic reason- than construct and command. ing still far too old to justify investing in its maintenance. Better to cut it all down, even if it never re-grows. Ignorance in action Many economists have tried to integrate environmental theory into economics. If my argument is sound, they are getting it backwards. By ignoring the problem of ignorance and applying linear reasoning rooted in market based ratio- nality to nonlinear issues, they end up with flawed analyses and mistaken perspectives. Consider two examples from Free Market Environmentalism, by Terry Anderson and
Connecting the Dots: Hayek, Darwin, and Ecology ------It is why, if is our world is why, It be subordinated natural to processes. must This disconnection theis fundamental tension between The results, The if logic the is itself work allowedto out un explainedI have all how societies are challenged the by The problem of a problem disconnection The between power and justifyTo their expense, modern capitalintensive fishing places a world-wide problem. Market problem. places logic simply cannot a world-wide think term long unless enormous profits promised are for doing so, as Anderson and Leal emphasize. economicand ecological processes. lastto as a prosperous and good us place live, to for eco nomics ring, around 200,000 salmon, 360,000 king crabs, and 15 million tanner crabs discarded, were the equivalent 50 of million meals. Because many these of fish and crustaceans are caught deep in the sea, they where adapted were the to high pressures the of depths, raising them the to surface normally Thisprac killsthem A-16). (Germain, p. 1995, tice is economically “efficient” in exactlywaythe Anderson and Leal described with respect cutting to and abandon ing smaller trees the get at to valuablemore larger ones and(Anderson Leal, 39-40). pp. 2001, checked, is catastrophic. In 2008 the Nations United Environment Program reported as as much 80 percent main theof world’s fish “ex catch speciesbeennow have close beyond or their to ploited harvest capacity”. If fishing rates continue unabated 2048 by all the of species currently foodfished for will 2008). have disappeared(Oliver, deep disconnect between biological and cultural ecosys tems, with the latter being dominant in the short run but the dominant former in the run. long than More society one has failed bridge to this disconnect well enough survive. to enormousThe increase in market is making power a chal failed met or once lenge particular by cultures in particular the drug ever been would have discovered, if market logic alone had forestry governed in the PacificNorthwest. importancethan applies more to forests. In many the of oceansworld’s overall catches begun have decline, to in casessome catastrophically This so. decline happened in a matter decades, of fish as stocks world healthy were after WWII. trawlers are virtually take to forced every fish they canlo cate. Often not theydo even use manyof the fishthey catch, because they are the wrong size species. or In a record 1994 million751 pounds dying of edibledumped fish were back into Alaska waters millionalone, from up 740 poundsin and 5001993 million pounds in 1992. David Germain re ports million 17 pounds halibut, of 4 million pounds her of ------
In Northwestern forests Anderson and Leal’s market A traditional economist might argue that I am describ Anderson and Leal describe the market core us logic for
been can developed, one but legitimately whether wonder to beto available in preserve to order the tree. the At time there Fortunately was for other no source taxol of (Kolata, 1991). and people yew alike,synthetic varieties taxol of now have tial medicines. Powerful struggles whether over emerged to harvest its medical for it value, even if unsustainably from seriously depleted populations, allow or less the of medicine is effective in treatingovarian, breast, cervical, pancreatic, and kinds some lung of cancer, as well as Kaposi’s sarcoma, Healthand the organization’s list on is World now essen of eas burned were in slash-disposal fires(Egan,1992; Leary By the time scientists1992). discovered taxol, produced it the taxol yew had less become much abundant. However, logic was applied to the Pacific Yew. Becauselogic wasYew. Pacific applied the to yews Pacific valuable not were lumber trees, most that grew in logged ar I think thisargument is incorrect, addressing would it take (or usfrom faranother perspective afield. Happily, unhap a concrete examplepily), goes well aesthetics… beyond lations. ing only a aesthetic fields. forests over for preference While ecosystem is be to able encompassed traditional by property rights owned individuals by and communities ratherthan corporations, they or exist within a larger network regu of innovative and successful ways, particularly in which local fishing communities managed have sustainableto develop practices, they are sodo to because able either the relevant ing resources: “the prevailing long-run interest rate serves as a guide determining for the rate which… at resources While theirshould be harvested.” book depicts some (41). Kingston Plans, Michigan. Loren Berndt VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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When the social sciences are divorced from the biological REFERENCES ones, and the commonality and interweaving of different emergent systems becomes confused or invisible, the results Adelstein, Richard 1996. Language Orders. 7 Constitutional Political will be misunderstanding of vital issues and destructive Economy, Fall. Anderson, Terry and Donald Leal 2001. Free Market Environmentalism. policy conclusions. Revised ed., New York: Palgrave. Berger, Peter and Thomas Luckmann 1967.The Social Construction THE IMPORTANCE OF ETHICS of Reality: A Treatise on the Sociology of Knowledge. Garden City: Anchor. Berndt, Loren, The Kingston Plains. http://geo.msu.edu/extra/ Given that people often urge interventions as soon as the geogmich/kingstonplains.html. By permission. advantages they seek appear to outweigh immediate dis- Cellular Slime Molds, Plant Life: anything related to plants. 2011. advantages while the future is ‘purely theoretical,’ there is http://lifeofplant.blogspot.com/2011/10/cellular-slime-molds.html an inherent tendency to make long term mistakes. With Covert, Bryce 2014. Lavish CEO Pay Has Virtually Nothing To Do respect to the market, Hayek considered ethical principles With How Well A Company Perform. Think Progress, July 23, 2014. https://thinkprogress.org/lavish-ceo-pay-has-virtually-nothing-to- the only reliable check to off-set the apparent advantages of do-with-how-well-a-company-performs-dd3312d15961#.uv0viq2gl short term interventions into complex market processes at Dawkins, Richard 1989. The Selfish Gene, 2nd ed. Oxford: Oxford the cost of long-term sustainability (Hayek, 1973, pp. 55-71). University Press. On this important issue Hayek was one with the ecologist Diamond, Jared. 2005. Collapse: How Societies Choose to Fail or Succeed. New York: Viking. Aldo Leopold who also emphasized ethics as a restraint on diZerega, Gus 2015. Not Simply Construction: Exploring the Darker power (Leopold, 1970, pp. 237-64). In the absence of ethi- Side of Taxis. Cosmos + Taxis, vol. 3, no. 1: ?? cal relationships the short-term advantages of intervening diZerega, Gus 2014. Paradoxes of Freedom: Civil Society, the Market, into complex systems will always outweigh the somewhat and Capitalism. Cosmos+ Taxis, 2:1. 61 diZerega, Gus and D. F. Hardwick 2011. The Emergence of Vancouver hypothetical long term disadvantages. As such, an appro- as a Creative City. In: Andersson, D. E., Mellander, C, & Andersson priate ethics is a essential tool for dealing with ignorance ÅE (Eds.), Handbook of Creative Cities, Cheltenham and when our power is greater than our knowledge. Perhaps the Northampton, MA: Edward Elgar. subject of environmental ethics is as important for main- diZerega, Gus 2010. Conflicts and Contradiction Within Invisible Hand Phenomena. Studies in Emergent Order, III, 1-27. taining a sustainable society as is the ethics men like Hayek
https:// cosmosandtaxis.files.wordpress.com/2014/05/sieo_3_2010_ + TAXIS COSMOS long argued are foundational for maintaining a free society dizerega.pdf (diZerega, 1996). diZerega, Gus 2000. Persuasion, Power and Polity: a theory of That, however, is beyond the scope of this paper.1 democratic self-organization. Cresskill: Hampton Press. diZerega, Gus 1996. Deep Ecology and Liberalism: The Greener Implications of Evolutionary Liberalism. Review of Politics, 58:4, Fall. NOTES diZerega, Gus 1988. Equality, Self-Government, and Democracy. Western Political Quarterly, now The Political Research Quarterly, 1. I would like to thank Chirag Kasbekar for alerting me September, 447-468. Egan, Timothy. 1992. Trees That Yield a drug For Cancer Are to Geerat Vermeij’s fascinating work, and to a referee Wasted, The New York Times, January 29. http://www.nytimes. for helping me clarify what is a fairly complex argu- com/1992/01/29/us/trees-that-yield-a-drug-for-cancer-are-wasted. ment. html?pagewanted=all Everett, Daniel 2017. How Language Began: The story of humanity’s greatest invention, New York: WW Norton. ______(2012) Language: the cultural tool. New York: Pantheon Frazer, Jennifer. 2015. Dying Trees Can Send Food to Neighbors of Different Specie. Scientific American, May 9. https://blogs. scientificamerican.com/artful-amoeba/dying-trees-can-send-food- to-neighbors-of-different-species/ Germain, David. 1995. Study: Fleet dumped 751 million pounds of edible fish. The Press Democrat, Santa Rosa, CA, December 8, A-16. Grames, Panos . 2012. Pacific Underwater: Salmon don’t grow on trees, but trees grow on salmon, David Suzuki Foundation, Oct 29. http:// www.davidsuzuki.org/blogs/healthy-oceans-blog/2012/10/-pacific- underwater-salmon-dont-grow-on-trees-but-trees-grow-on-salmon/
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Creative. WW New York: Norton. https://daneverettbooks.com/wp- The Theory of Economic Development. TheNature Fix: NatureWhy MakesUs The Species Problem: Biological Species, . October 19. TheEvolutionary World: How Adaptation http://edition.cnn.com/2008/WORLD/ Seeing Like a State. , August. The Social Conquest of the Earth , March 42. 18: Nature: An Economic History An Nature: Science The Annual Review of Earth andPlanetary Sciences. Scientific American Scientific . Harpers. http://depts.washington.edu/strmbrgl/StrombergLab_
Research LettersResearch doi/10.1002/2015GL063040/full Saharan Much How Dust Feeds Amazon’s Plants, Feb. 22, 2015. http://www.nasa.gov/content/goddard/nasa-satellite-reveals-how- much-saharan-dust-feeds-amazon-s-plants creatures-in-the-gut/ Press. OxfordYork: University Press. Ontology, and the Metaphysics of Biology Books. Ecosystems, March 1. website/Publications_files/Str%F6mberg_2011_AREPS.pdf Explains Everything From Sea Shells to Civilization Saint Martin’s Press. University Press. Happier, Healthier, and More Norton. Chomsky content/uploads/2016/07/HarpersMagazine-2016-08-0086105.pdf Zhang, Winkler,Omar, D. Yang, Y. Z. Y, Zhang, and C. Zhao. fertilizing The 2015. roleof Africandust in the Amazon rainforest: A firstmultiyear assessment basedon data from Cloud-Aerosol Lidar and Infrared Pathfinder Satellite Observations, edition. March 29. asiapcf/03/24/eco.aboutfishing/index.html Water: Merging of Climate Change with Pollution, Over-harvest, and Infestations in the World’s Fishing grounds. org/pdf/InDeadWater_LR.pdf http://www.nytimes.com/2012/04/12/opinion/why-trees-matter. html life Earth, on news/2015/10/scientists-may-have-found-earliest-evidence-life- earth Great City And Mobile Data Phone Proves It. https://www.fastcoexist.com/3058864/jane-jacobs-was-right- about-what-makes-a-great-city-and-mobile-phone-data-proves-it in the Gut, scientificamerican.com/article/mental-health-may-depend-on- Scott, James C. 1998. Schumpeter, Joseph 1961. Stamos, David N. 2013. Strömberg, Caroline Evolution A. Grasses of E. 2011. and Grassland Geerat Vermeij, 2010. ______2004. Williams, Florence. 2017. Wilson, E. 2012. O. Theorigins 2016. of Speech: Tom Wolfe, in the beginning there was H., M. Chin,Yu, Yuan, H. Bian, T. L. A. J. M. Remer, Prospero, A. Oliver, Rachel 2008. All about: Global Fishing. CNN international Robbins, Jim 2012. Why trees Matter, Rosen, Julia Scientists 2015. may have found the earliest evidence of Schiller, Jane Ben Jacobs 2016. Right Was About What Makes A Schmidt, Charles Mental 2015. Health May Depend Creatures on , ed. New . rd . . The , 3 , January 394, 431. 394, 431. Chicago: New Studies https://www. http://www. Nature . New York: . New York: Vol 21: 1 March: 21: Vol Science News May 13. http://www.May 13. . New York: Ballantine. New York: . London: Phoenix. Smithsonioan MagazineSmithsonioan , December 2. Proceedings of the National , December 30. , 82(9): 2403-9. , 82(9): Dirt: The Erosion of Civilizations ; The Guardian The f Chicago Press. . Ecology. o Filters Against Folly: How to Survive Despite , February 26. TheSymbiotic Planet The Structure of Scientific Revolutions , The New YorkTimes, , TheNew Sand County Almanac Competition and Entrepreneurship. Entrepreneurship. Competition and Law, LegislationLaw, and Liberty: ThePolitical Order of The Death andLife of Great American Cities. Chicago: University Chicago of Press. The New YorkTimes TheNew Health Promotion International. Promotion Health Law, LegislationLaw, and Liberty: Rules and Order Bill Vitek Jackson and Wes eds. Lexington: University http://www.smithsonianmag.com/innovation/the-
40 years, scientists say. theguardian.com/environment/2015/dec/02/arable-land-soil- food-security-shortage Berkeley: University California of Press. new imperative the for life sciences. Academy of Science 11: 15. approved-to-treat-cancer.html Books. Lawrence St Leger. 2006. Healthy nature healthy people: ‘contact with nature’ as an upstream health promotion intervention for populations. 45-54. nytimes.com/1991/05/13/us/tree-yields-a-cancer-treatment-but- ecological-cost-may-be-high.html?pagewanted=all Chicago: University Cancer,Treat nytimes.com/1992/12/30/us/drug-made-from-rare-tree-is- Knowledge, Kentuckyof Press, 27. Vintage,York: 112-40. pp. University Chicago of Press. Cost May Be High Grandparents Could Genes, Be In Your December. toxins-that-affected-your-great-grandparents-could-be-in-your- genes-180947644/?no-ist Virtues of Ignorance: Complexity, Sustainability, and the Limits of Chicago: University Chicago of Press. Derived Nitrogen Riparian on Forest Growth and Implications for Stream Productivity 1998. PloughingYoung up the wood-wide web? July30. Economists, Ecologists Eloquent Merely the and Penguin. a Free People, in Philosophy, Politics, Economics, and the History of Ideas Chicago: University Chicago of Press.
Montgomery, David R. 2007. Milman, Oliver Earth 2015. has lost a third arable of land in past McFall-Ngai, Margaret. al. Animals 2013. in a bacterial world, a Milius, Susan Microscopic 2014. Menagerie, Margulis, Lynn 1999. Maller, Cecily, Mardie Townsend, Anita Pryor, Peter Brown and Leopold, Aldo 1970. Kuhn, Thomas1996. Leary, Warren E. 1992. Drug Made Rare From Is Approved to Tree Kolata, Yields Tree Gina a Cancer 1991. Traetment, But Ecological Jacobs, Jane 1961. Kirzner, Israel 1973. Jackson, 2008.Wes an Ignorance-based Toward Worldview, Interlandi,Toxins Jeneen. The That 2013. Affected Your Great- Helgason, T., T. J. Danniel,Helgason, T. T., R. Husband, A. H. W. Fitter and J. P. ______1973. ______1973. Helfield,James M. and RobertNaiman. J. 2001. Effects of Salmon- Hayek, F. A. 1979. A.Hayek, 1979. F. ______1978. Competition as a Discovery Procedure. Hardin, Garret. 1986. VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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The Role of Spontaneous Order in Video Games: A Case Study of Destiny WILLIAM GORDON MILLER
Manuel H. Johnson Center for Political Economy Sorrell College of Business Troy University Troy, AL 36082
Email: [email protected] Website: https://www.linkedin.com/in/gmiller1991/
Abstract: Complex and uniquely human spontaneous orders are central to the Austrian understanding of the market process and price system. Yet, these spontaneous orders are often difficult to study with traditional empirical methods. Since virtual worlds serve as extensions of our own world, video games offer alternative methods to empirically study spontaneous order. To that end, this paper presents a case study analyzing the role of spontaneous (or emergent) order in facilitating enhanced value for players. Through exploring the emergence of social institutions in Destiny, I provide evidence of the benefits of de- centralized decision-making within virtual worlds. Given the theoretically limitless number of game elements from which to draw, this analysis utilizes the most basic and highly representative examples from the Destiny universe to showcase the phenomenon of spontaneous order within this context. 63
Keywords: Spontaneous order, emergent order, Destiny, video games, Austrian economics
JEL Codes: B53, P49, Z10 COSMOS + TAXIS + TAXIS COSMOS
“The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.”—F. A. Hayek (1988, p. 76)
I. INTRODUCTION of the same features inherent in our own. For example, many of the triple-A games–typically those which are heav- While paramount to the Austrian understanding of the ily promoted and possess the highest budgets–released market process and the price system, complex and uniquely today showcase lush environments, a large variety of char- human spontaneous orders are difficult to study in the -ex acter interactions, and complex economies, thereby mak- perimental laboratory or with computational economics. ing some of their worlds hard to distinguish from reality While these methods are useful in advancing our under- (beyond their inherently fantastical nature). Furthermore, standing of spontaneous order, as are historical case studies with the advent of online multiplayer gaming, these uni- and comparative institutional analysis, the rise in popular- verses have become extensions of our own in which social ity of video game platforms provides a unique avenue for networks, money, and learning fluidly transfer back and studying the formulation and effect of spontaneous order forth between the virtual and real world. in complex environments inhabited by diverse agents with Video games provide an appropriate research methodol- varied, and often conflicting, intentions. ogy to evaluate economic theory and the accuracy of eco- Having risen immensely in popularity over the last three nomic observation for at least three primary reasons. First, decades, the interactive worlds of online video games have while informative, the choices made by players in laborato- developed into richly detailed universes that display many ry experiments, and the resulting consequences, often have
The Role of Spontaneous Order in Video Games: A Case Study of Destiny
------4 As previously suggested,video games a fairly represent The open models of Austrianopenmodels The of economics enable the ex Modern research in Austrian economics has extended extend such an analysis spontaneous of the to order world videoof games. realistic laboratory analyzing for human While behavior. controllablenot the to extent most laboratory experiments often are, to theydo tend incorporate a higher degreeof consequential realism. As Falk and Heckman argue, (2009) on institutionallyon sterile environments (Boettke, choice of They Fink, focusto tend thus and on devel Smith 2012). oping mathematical theory, in terms optimization agent of subjectconstraints, to andeconometric empirical methods using conventional data sources. amination and understanding the spontaneous of of role While order. this limitspolicies of the for development a downside of engineering 2011), the (Wagner economy the Austrian many to approach mainstream economists, definitionof what 76) p. the doesit advance (1988, Hayek’s primary demonstrate task men to economists of is, “…to littlehow they really know what about they imagine they can Interfering design.” with social complex arrangements, according Austrians, to be should taken not lightly since in dividualsnaturally cooperative develop institutions inor various solve der to within problems society (Boettke and Candela 2015). our understanding the spontaneous of of pi role to order rate organizations (Leeson 2007), prison organizations These and commercial (Benson(Skarbek 1989). law 2012), studies and others provide evidence the sponta of of role withinneous order society.purpose The of this paper to is II. LITERATURE REVIEW II. LITERATURE mainstream to AustrianCompared economists, econo mists placed have far emphasis understanding on more the spontaneous of role (Boettke order 2015). 1990; D’Amico Thisto due bothis theoretical emphasis methodology. and Austrian economists seek understand to self-inter how ested individuals social create complex arrangements and the division labor placing of by the science exchange of at the their of core emphasis (Boettke, Fink, and Smith 2012). They utilize to tend thus empiricalmethodologies such as comparative institutionalanalysis (Boettke, Coyne, Leeson, and analytical Sautet 2005), narratives (Boettke 2000), laboratoryand experiments agent-based Smith 1994), (V.L. computational modeling (Nell Wallick 2009; Seagren 2011; In comparison, mainstream2012). economists focus to tend ------there 2 This pa 3 . I hold that. I hold this order Destiny . Section V concludes. Destiny Due the to mass appeal this of new form 1
The rest The of thisproceeds paper follows.as Section re II Although there is a growing body literature of focusing
my casemy study the of evident two order levels emergent of within the of world in this line research. of Section III the covers theoretical structurethe of paper and connects the to it larger body of related the to work theory the of firm. Section provides IV views the relevant literature spontaneous on orders, issues concerning experimental vs.research, field and simi the laritiescomputational agent-based to modeling inherent institutions particularly broadly, more those related on to line mediums. ly those related the to lack predesigned of social institutions within the game. Understanding this how emerges order usshould help understand to the importance such social of order inorder the of game world might be observed primarily through the ways in which interact production especialplayers problems, overcome to per contributes that to literature explicitly by focusing on the Austrian spontaneous concept of through order video games. Specifically,lookto I formation of emergent the games advance to our understanding economics, of arestudies few focusing the on economic concepts em phasizedthe by Austrian schooleconomics. of spontaneous order. applyingon economics video to games and using video overall knowledge available analysis. for In comparison, computational economics lacks the uniquely social aspects humanof behavior that are important understanding for doing so, theories concerning human action become more well-informed, thereby contributing the to robustness of Finally,the social interactions that developed in have tan dem with these games allow social scientists directly to ob serve, informal a more at level, real human interactions. In (Duggan 2015). (Duggan media,of large sample sizesare naturally available which serve maketo video games a sortnatural of experiment. ratoriespull often a of from sample highly-educated col students,lege video game least players, at those in America, often come a from wide variety of diverse backgrounds little direct no to effecton world in whichthe we Videolive. gamesconsequential, provide more a admittedly but less controllable, Second, laboratory. while experimental labo VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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the laboratory methodology is widely criticized by social experimental approaches best help to inform our under- scientists due to its lack of “realism” and “generalizabil- standing. ity.” However, they contend, that despite its limitations, it Interestingly, his work also suggests that these types of provides a rich narrative upon which to base an argument. simple computational programs represent a minimalistic Laboratory experiments and field research are comple- variety of emergence in that they provide for interesting ments, not substitutes, and both should be valued for the behavior even in an environment of less explicit direction/ potential they have to enrich our knowledge of the social randomness. In other words, this behavior in programmat- sciences. ic language occurs beyond just the confines of its basic de- Notably, Normann, Requate, and Waichman (2014) find sign. Additionally, making the underlying framework more that short-term lab experiments actually predict the long- complex results in a relatively insignificant amount of extra term behavior of field research pretty well under certain behavioral complexity. As such, much of the interesting be- circumstances. Furthermore, V.L. Smith (1994) argues havior should be observable within the simpler model. that experimental economics ultimately contributes to the Essentially, the current paper extends this line of thought robustness of our understanding of the social sciences by by looking at video games as relatively simplistic programs satisfying one or more of at least seven purposes.5 Given (at least along certain margins) that lead to undesigned the aforementioned nature of video games, they serve as a complex behavior. Though a “designed game” exists on natural compromise between the two methodologies of lab some level, the focus in this paper lies primarily on the experiments and field research. more complex social institutions that emerge within this Interestingly, video games might also be viewed as a clas- framework. By serving as a type of hybrid methodology of sification of agent-based models (ABMs). Niazi and Hussain all the above approaches (i.e. experimental, empirical, and (2011, 2) provide one definition of an agent within these computational), video games provide us a window into the 65 models as the following: “a representation of an interacting social aspects of interest, and as such, the succeeding case social component of a large system used to explore emergent study provides a more thoroughly realistic presentation of global behavior in a simulation.” The importance of such human behavior, specifically as it applies to spontaneous an application to Austrian work can be found in Seagren order within a programmed environment. (2011). Specifically, he argues that agent-based modeling COSMOS + TAXIS + TAXIS COSMOS can serve as the Austrian answer to the mainstream econo- III. THEORETICAL FOUNDATION mists’ emphasis on mathematical models. Furthermore, he proposes that this type of modeling could serve as a more This section of the paper functions to provide a theoretical explanatory alternative to traditional neoclassical analysis, foundation for the succeeding case study. The first subsec- which unfortunately leads to the exclusion of so many rel- tion relates work on the theory of the firm to the question of evant aspects of human activity. emergent social institutions in video games. Following this, Wolfram (2002), working from the perspective of physics I provide an overview of the case study methodology as well and computer science, lays the foundation for such models as a general framework for Section IV. in his exploration of how a surprising amount of complexity in computation tends to be generated even by what he refers 3.1 Theory of the Firm and Social Emergence to as relatively simple computational systems. In doing so, As previously hinted, the social institutions in the world he provides several examples of this phenomenon related to of Destiny remain distinctly organic, and therefore, they a wide variety of systems including cellular automata, mo- represent the most relevant factor in considering the phe- bile automata, Turing machines, etc. To the extent this idea nomenon of emergence within this realm. Why do such holds, he argues that a driving principle in science ought to institutions emerge though, and what are the advantages consider experimentally investigating this type of complex- of this emergence as opposed to the architectural design of ity as a complement to traditional models of mathematical such institutions? The answer to the first question might be exploration and engineering principles. This idea might gleaned through the theoretical work on the firm while the best be summarized in his concept of computational irre- answer to the second is addressed more in the work from ducibility in which it simply remains impossible to describe Hayek (1945) and A. Smith ([1776] 2003). this behavior in some concrete way. Rather, empirical and Essentiallly, the theory of the firm tries to explain both the reason why firms emerge as well as the disntiguishing
The Role of Spontaneous Order in Video Games: A Case Study of Destiny ------the support domestic of that to foreign industry, of he intends only his own security; and directing by that industry in such a manner as be may of its produce the greatest value, intends he only his own gain, and ishe in this, as in many other cases, an led by invis an hand which ible end promote to was part no his of is always it intention. Nor the the for worse society that was it part no it. By of pursuing his own inter The value of spontaneous order, The opposedvalueas of spontaneous to order, the con As every individual, therefore, endeavours as much as can he his both capital employ to in the support of domestic industry, and so direct to that industry that be the may of its produce greatestvalue; every indi vidual necessarily labours the render to annual rev the of enue society as great as can. he generally, He indeed,the neither intends public interest, promote to is he promoting knows much it. Bynor preferring how Considering all this, of becomes it that apparent low institution this (in case, social a platform made the by game such decisions be to very tend case- However, developer). specific, situations and can often doand arise that rarely conform that to particular case. Again, the time and place knowledge that arises in a given instance is crucial effec for tively makingquestion The any 1945). such decision (Hayek then becomes:Can institutions be architecturally designed facilitateto spontaneous in order gameplay (Beaulier, Smith, and Sutter 2012)? structed is that allows it through order, outcomes for the “invisible hand” that remain hard design properly to through 572) central direction. Adam Smith ([1776]2003, encapsulates the basic spontaneous idea of in order the fol lowing: the time takes it acquire to them. this Unfortunately, means that in regards simply shirk may the to a player his latter, responsibility in terms allowing of others his generate to rewards, and as such, an incentive exists underproduce to the in desiredpractice, good. However, as shall we see, this strong to due social be tendsthat problem a not to of much mechanisms of exclusion and reputation. transaction costs and increased potential gains incentivize thesocial of emergence institutions in gaming.ques The becomes,tion now does this lead better to com outcomes paredthe to ex ante creation such insittutions? of the Well, answerbe straight-forward. not may Certainly, are players mistakes to prone and will make them a So, for frequently. particular case under strict assumptions, is perhaps it pos bettera for result to sible outcome from centrallya made ------, as well as Destiny , actively the prohibit peer-to- Destiny
Another in way which the theory the of firmrelates to In addition, the for purpose game of balance, many Granted, the social activity seen in
the reward is effectively zero and only the real cost comes in from a non-rivalrous source since such gains are typically digital in nature they (i.e. are infinitelyleastat reproducible, in any practical Hence, the marginal sense). cost creating of propriate mechanismspropriate metering of problems for and moral hazard, games such mechanisms have to tend readily built into them. In regards rewards the to generally former, come thesocial of emergence institutions in gaming centers around the increased idea of from output team production (Alchian While and Demsetz this 1972). does ap on rely making nearly it impossible facilitate to any sort work of marketable transaction, least at in the traditional sense. largely infeasible as goods would likely be to bundled have in relatively unmarketable ways. Ultimately, this barrier does drastically increasing up end transaction costs by ing certain to due being players too rapidly “overpowered”). market exchangeNotably, might still occur through the buyingand selling accounts,whole of this but remains thisconstitutes an artificial to counteractbarrier,helps it in-game equity that problems ultimately lead efficiency to keep helps it the (i.e. gameproblems from becoming bor games, including Though items,peer armor, etc.). exchange (weapons, loot of tend to be to sufficiently tend high to warrant coordinatedproduc tion.costs Such include the fixed costs of setting a up mar ketplace and the variable costs maintenance. of traditional firm,doesit but occursimilar for reasons. For example, the transaction costs simply exchanging of goods inproduced game,assuming they can be priced, somehow organizational competition (Fama and Jensen 1983). video games generally, differs more significantly a from 1972), ownership structure1972), (Jensen and as Meckling 1976), set specificity (Williamson and agencyproblems in 1983), coordinator) relative market simple to coordinator) exchange via (i.e. the price mechanism). Otherbuilds work this on looking by thingsat such as team production (Alchian and Demsetz optimal lies solution in creating type some firm, of size the whichof depends the on marginal benefits and costsof each unit in produced the firm(i.e. via entrepreneur- the decisive factor in whether individuals not or will contract theon market organize or formally. If more the costs us of ing the price mechanism are sufficiently high, more then a characteristics between the form and functions various of providesof one firms.the earliest(1937) neoclassical Coase themodels for firm in which transaction costs represent the VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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est he frequently promotes that of the society more provide a solid starting point for considering how such in- effectually than when he really intends to promote it. stitutions might enhance overall gamer welfare. I have never known much good done by those who af- fected to trade for the public good. It is an affectation, IV. A CASE STUDY OF DESTINY indeed, not very common among merchants, and very few words need be employed in dissuading them Now consisting of two games, Destiny 1 and Destiny 2, as from it. well as a number of expansions (all of these combine to form an ongoing continuation of the same game), the Destiny As this quote relates to video games such as Destiny, im- universe represents a dynamic and evolving world, espe- proving societal gains comes through increasing the value cially in regards to its social institutions. Given its unique of the game for everyone through individual self-interest- place in the repertoire as a hybrid MMORPG (massive-mul- ed actions. Each individual only cares about enjoying the tiplayer online role-playing game) and first-person shooter, game for him or herself, but in coordinating with others this game relies on robust social networks to not only sur- to achieve such satisfaction, each individual ultimately en- vive, but to thrive. Despite this, very little infrastructure hances enjoyment of the game for others as well. While such exists within the game itself to coordinate such social ac- coordination or decisions may not always be optimal (and tivity. While a formal automated matchmaking system does realistically speaking, they rarely are), the market (or in exist, it remains relatively limited in function compared to this case, the collective decisions of the players) constantly games similar in type.6 Nevertheless, players still end up co- adjusts to approach such optimality. Allowing the relevant ordinating, outside of any central direction, and as a result, institutions (in the case of Destiny, those related to social some interesting norms within the game tend to form. platforms) to emerge organically, as opposed to attempts at 67 predicitively defining them, promotes experimental compe- 4.1 The Functional Level of Order tition and market discovery. As such, I argue that this tends This level of order deals primarily with the matchmaking to encourage more well-being in the long run. and loot systems within Destiny, and it describes a founda- tion upon which player norms tend to develop. In regards to 3.2 Overview of Case Study Methodology the former, a number of different options exist for match- COSMOS + TAXIS + TAXIS COSMOS In order to effectively get at the question of how emergent making within Destiny’s gameplay. From a core perspective, order improves social outcomes for gamers, I am employing the game offers a matchmaking service that differs from a case study of a few different mechanics within the Destiny other multiplayer games by utilizing what has been termed universe. By using the more expansive term universe, I in- mesh networking. This allows the entire game world to be tend to imply the inclusion of factors within Destiny that populated at all times so that no one ever feels alone. This lie outside of gameplay itself such as dedicated forums, operates in stark contrast to many other games that have matchmaking websites, and other user-generated materials. limited servers in which players may end up in an area com- In addition, numerous articles have been written concern- pletely by themselves.7 ing various aspects of Destiny’s game world. All of these In effect, an automated matchmaking service adds play- resources serve to highlight the effect and value of sponta- ers to your fire team based on a number of different criteria neous order within the overall scope of the game. whenever you enter a specific game mode. However, there In regards to specific instances of emergent social institu- are still some areas of gameplay that do not facilitate match- tions within the game, I argue that Destiny promotes order making through this automated system. In such cases, it on two levels, namely the functional and applied levels. The becomes the player’s responsibility to find other people to first deals primarily with a foundational level of order which join his or her fire team in order to participate in the given the second then develops into well-established norms. As activity. For example, gameplay features such as the popu- previously mentioned, these examples are by no means lar raids, nightfalls, Trials of Osiris, and Trials of the Nine meant to be considered all-encompassing representations of require manually pre-made teams in order to participate. how Destiny embraces such concepts, nor do they implicitly This has resulted in some controversy as some players pre- preclude negative outcomes from such institutions. Such an fer such a system while others think that automated match- analysis is outside the scope of this paper. However, they do making should be extended across all game modes.8
The Role of Spontaneous Order in Video Games: A Case Study of Destiny , ------to a to Destiny Destiny’s Destiny has ta a loot Regardless, the 13 Destiny universe. demonstrates functional . In a video entitled “Destiny: many which of are gear piec Destiny 10 Destiny Destiny Notably, there are also Notably, items that a few can 12 Danny O’Dwyer explores what considers be to he 11 As this all are players con relates spontaneous to order, Simply speaking, each activity in Another area in which In fact, given the highly repetitive nature this of game, time and allocation) money through creating system a in which constantly players their can upon improve to work individual character designs and signal certain aptitudes/ advantages. stantly pursuing self-interested motives in improve to order aswell as diversify each their of characters, and often, these goals are in conflict with one another. After all,piece of the The Hardcore Gamer’s Slot Machine”Slot HardcoreThe on The Gamer’s his show Point, ethical concerns around the perceived lottery structure of game.Bungie’s In essence, argues he that, given the mon etary attached component DLC the to grind loot in the game can be likened gambling. to he sug Therefore, geststhat carries it with concerns it around exploitation. Although such a moral question is the outside scope this of the illustrationpaper, provides he comparing machineslot remains highly as apt a description the of in centive structure in place. ble, which continuously changes. this From table, loot there are set probabilities the for given activity drop to a particular item. Additionally, with various updates, there are also different a few methods of affectingthese prob abilities and ensuring least at value some every of out drop. Furthermore, a number smaller, of less valuable, items are guaranteeddepending the on activity in which the is player participating. beacquired via micro-transactions, these but are generally limited updates some in have cosmetic to items. However, the cluded sale practical of items as well. gamerewards (viaeffort playtime) dedication(viaand play shall see, this leads interesting some to activities normsfor relatedend-game to activities and the Crucible, version of competitive multiplayer. liesemergence in character customization and the procure the loot. of From wealthment options availableof create to a distinctive character the at start the of game a database to of approximately 5,000+ items, es the can player equip, opportunities creating for a truly unique character abound. As such, this robust mechanism represents the other part the of foundation which upon so cial emerges within order the creating such a character and collecting this database item is likely the primary motivation behind sus most players’ tained commitment to ------to ex Destiny registered base player to game This world. comes order Destiny’s Destiny’s 9
Ultimately, this structure the to comes due about lack Through such variedto approaches matchmaking, To overcome the problem of finding the of such problem ac for overcome players To
most importantly, socially engagein the gameitself. As we removed. Regardlessremoved. though, stillit constitutesdefineda social institution in which can players connect, share infor mation, discuss strategies related certain to activities, and individual this needs. system Moreover, creates stronger incentives and accountability mechanisms see to activi ties through begun once as anonymity is least at partially design. that benefi I argue,presents a more it however, cial institution primarily since allows it the for formation teamsof and the exchanging information of relevant to of a more “complete” matchmaking “complete” a more of service created the by that repre end, plausibly Bungie. it developer, To game’s sents a second-best alternative compared centralized to is 3 hours per day, it is it unlikelyis 3 hours per day, that this wide is a major spread concern. tend automated matchmaking automated tend all to game modes. However, given the spike recent in 25 million users as well as the fact that average engagement a multitude self-interested of actions that lead a wide to number beneficial of mostplayers. Granted, for outcomes as previously stated, there is a push pressure to variety tasks of in from not about centralized decision-making in which fire teams are determined directly Bungie, by rather but from a large creating number options for of their fire teams. As a result, are coordinate players to able effectively with one an other in find to good order players withto tacklewhom the XBOX Live, etc. Bungie has established a framework in which have players ual matchmaking exist as well such as the Bungie Forums and fan-created tracking sites. Furthermore,are players also free create to fire teams from their friend listson PSN, an avenue for those who do not have pre-formed teams those pre-formed for have an to not do who avenue find individuals Other manoptionsfor withplay. to whom play and play alsosend messages connect.to Thisprocess over comes commitment and relationship issues associated with matchmakingautomated while the at same time providing respectively, along with details around proposed game modes, platforms, and levels. Each group then can view list ings in the other group find to individuals withto whom looking team more for members coordinate to manual on matchmaking.Essentially, list players themselves as either LFM or (LookingLFG (Looking More), Group) for for tivities, numerous LFG services such as DestinyLFG have whichemerged allow either players looking a team for or VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
COSMOS + TAXIS 68 COSMOS + TAXIS
gear or improvement that one player is pursuing may not medium serve to develop new regular raiding groups and be the same one that another player is pursuing. However, sub-communities with which players often continue to given different character builds, complementary abilities, participate. Ultimately, these norms help build and estab- and varying levels of progression, it becomes advantageous lish lasting connections within the community that assist for such players to team up and work towards different loot individual players within the game itself, and they extend goals together. Thankfully, the game provides plenty of op- to other end-game content and Crucible activities as well. portunities for this and, most notably, not through design. Interestingly, much like other games, these connections Instead, it occurs in a truly spontaneous fashion coordi- also often go beyond the Destiny universe and develop into nated through emergent social institutions. This leads to real friendships.14 certain established norms which I explore in the next sub- Another more concrete area in which emergent social in- section. stitutions have established order can be found in the game’s Notably, this also facilitates greater team well-being as customization system. This extends across both the coop- each player is satisfying his or her comparative advantage erative and competitive multiplayer modes, and the shar- (based on character design, goals, and availability) through ing of information within the community leads to a set of the division of labor in helping to achieve each group mem- standard norms for ability and gear selection. Examples for ber’s goals. Logically, it would be highly unrealistic for a cooperative play include commonly understood practices central planner to know not only which particular item a such as using the weapon Gjallarhorn to quickly and effi- given player wishes to pursue, but also which combination ciently take down the raid boss Crota, taking advantage of of players will best help him or her acquire it. Within this the Hunter’s invisibility ability to easily revive dead team- game, we instead see players voluntary forming mutually mates, using the Titan’s bubble shield to easily generate beneficial arrangements through emergent social appara- more super energy, etc. Importantly, these norms are estab- 69 tuses to accomplish various objectives without any sort of lished both through word of mouth and the same forums/ direction. LFG sites that players use to construct fireteams. Regarding competitive multiplayer, the Crucible can also 4.2 The Applied Level of Order be a fantastic demonstration of this norm. Given the strate- Building on this foundation, an applied level of order forms gic nature of competing against “real” players, choices sur- COSMOS + TAXIS + TAXIS COSMOS in which some interesting norms emerge within the Destiny rounding weapon and armor selection can be crucial. The universe. For instance, challenges such as the various raids trick for each individual player is to decide on an equipment provide opportunities for securing unique pieces of gear set that will deliver the strongest advantage in actual game- that cannot be found anywhere else. Why then might we play. This can vary depending on such factors as the type of see veteran players who have already acquired this gear con- match being played, the map that is randomly selected, and tinue to participate? Outside of simply enjoying the game or even the other players within the match itself. Regardless, securing additional materials, a strong incentive exists for certain consistent choices prove to be most advantageous in these individuals to help less developed players to learn and this mode, and much like its cooperative mode counterpart, complete the raid, namely the reputational benefits and fa- these come about through the emergent social institutions vor economy that emerge from this interaction. at play. Examples of such norms here include the coordi- Since the automated matchmaking system does not ex- nated collection of both heavy ammo refills (to keep it away tend to the raids, players often must resort to LFG sites and from the other team), use of standard sniping locations on forums to put together their fireteam and the most sought each map, the formation of specific strategies in Control, after players from these sites (especially for newer players) the domination of certain weapons during particular ver- tend to be those who have already reached the level cap and sions of the game, etc. completed the raid multiple times (this results from trans- These examples by no means constitute an exhaustive list action costs related to the development of relevant knowl- of the norms that have developed within the Destiny uni- edge). Such veteran players, in return, receive a reputation verse. They do, however, provide a starting point for con- boost within the social community for their assistance and sidering how order is spontaneously established within this new connections upon which they can call to help complete game and the key role that emergent social institutions play other in-game tasks. Furthermore, even if the players one in interacting with the given programmed environment. recruits are not veterans, the connections formed in this Furthermore, it provides a foundation for exploring other
The Role of Spontaneous Order in Video Games: A Case Study of Destiny - - - forums and LFG sites. examples few A related Destiny In addition, there are a number other of lines research of gardless this how of stream research of evolves, video games can provide insight us much into the economic questions of both today and tomorrow. to otherto this interactions. “real-world” paper pro However, vides initial support such an for argument. that could be pursued from such a perspective. notable One extension the of current paper involves measuringthe fre breadth, andquency, regularity matchmaking of queries on otherto include case topics studies the of same idea with differentgame genres, the interaction between spontaneous andorder creative destruction in video game worlds, and the effects of entrepreneurship on order. of emergence the Other Austrian concepts could also be explored in relation videoto games such as the application the of structure of production video to game worlds, the effects government of regulation the on industry,and the knowledge as problem relates the to it various decisions In players. of any case, re ------. Destiny as well as the fact that is it funda Destiny
Since many video games mimic reality least some to (at By examining two theoretical and levels order con of
done to demonstrate to done this claim. Examples might include the analysis social of relationships formed while playing these games as well as the transference these of principles within this should game also world intuitively real to apply again,ity least at (or research, the More digital it). of version both the of econometric and analytical varieties, should be mentally a game driven opposed human to by (as players artificiallyits universeintelligent is agents), essentially an extension our of own. What applies human to interactions have much to tell to much have us our about own least at world, in re gardsour to online personalities. the Given naturallysocial withinelement degree) throughdegree) similar environments, the hu presence of man interaction, and robust economic systems, they likely result from any centrally directed action de the by game’s rather but throughveloper, multiple agents pursuing differ goalsent in the service self-interest. of In other instances, simply amounts it a naturally to forming and mutually enforcing arrangement decisions of among several differentplayers. In eachrespect, thisdoes order not tions operate. Sometimes, this takes the players form of solving various through problems innovative and solutions passing along the information through relevant networks. communities establish to helps certain norms within the universe. game’s While this analysis means is no by exhaus tive, doesit provide an initial these intolook how institu sidering previous research the on the of emergence firm, I provide several examples in which the formation online of the existing literature fill to helps thisby exploring gap how socialemergent institutions establish to work spontaneous withinorder the video game uniquely Austrian concepts within this medium been have woefully that contribution end, my to under-pursued. To examining economic inquiries with minimal consequences, they through provide a solid avenue which explore to vari oustheories and ideas. analyses Unfortunately, concerning In conclusion, videoIn conclusion, games serve an effective role in mirror ing the various of economic outcomes institutions within society. As they essentially act as a natural experiment for V. CONCLUSION V. emergent phenomena within phenomena emergent video games, and us helps it understandto online how communities naturally form and indevelop context. a broader VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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NOTES a formal clan system and the Guided Games mechan- ic. For more on this, see Eddie Makuch’s 2017 article 1 For more on the demographics of gamers and other “Destiny 2 Guided Games: Here’s What You Need to data on the industry, see the Entertainment Software Know Ahead of Launch” at https://www.gamespot. Association’s (ESA) “2017 Sales, Demographic, and com/articles/destiny-2-guided-games-heres-what-you- Usage Data” report at http://www.theesa.com/wp-con- need-to-know/1100-6453521/. While time will tell how tent/uploads/2017/09/EF2017_Design_FinalDigital.pdf these new ideas will influence the development of the as well as Krista Lofgren’s “2017 Video Game Trends franchise, they matter very little for the analysis of and Statistics—Who’s Playing What and Why?” at emergent social institutions within this paper. They do, https://www.bigfishgames.com/blog/2017-video-game- however, present an interesting feedback development trends-and-statistics-whos-playing-what-and-why/. which begs the question, “Do game developers respond 2 Lehdonvirta (2005), for example, explains how the effectively to broad consumer interest or are such economic systems within video games, especially mas- changes merely to appease a vocal minority within the sive multiplayer online (MMO) games, mimic real life fan base?” systems. There is also a growing body of literature in 7 See Anthony Taormina’s 2014 article “Bungie Details economics analyzing various aspects of video game ‘Destiny’s Seamless Matchmaking for Multiplayer” at worlds. Most of the research focuses on providing ex- http://gamerant.com/bungie-destiny-matchmaking- amples of, and support for, basic economic concepts multiplayer-detail/. (Bilir 2009; Castronova 2003, 2006; Hunter 2003; 8 See Paul Tassi’s 2015 article “Everything in ‘Destiny’ Lastowka and Hunter 2004, 2005). Salter and Stein Needs Matchmaking, Yes, Everything” at https:// (2016), however, provide a notable exception to this lit- www.forbes.com/sites/insertcoin/2015/05/07/ 71 erature, using Austrian economics to understand how everything-in-destiny-needs-matchmaking-yes- monetary institutions in Diablo II emerged to facilitate everything/#602dd0e87943. exchange. 9 See Matt Martin’s 2015 article “Destiny Players Grow to 3 Notably, however, a recent methodological work does 25 Million, Putting in 3 Hours per Day” at https://www. explore the role of emergent order within virtual vg247.com/2015/11/03/destiny-20m-users-3-hours-per- COSMOS + TAXIS + TAXIS COSMOS worlds more generally. Mildenberger (2015) explores day/. economics as it relates to the anarchical word of vir- 10 A complete listing of all current loot can be found at tual pirates. Although such individuals tend to be in- Planet Destiny’s website, http://db.planetdestiny.com/. herently conflict-loving, rules emerge to mitigate their 11 See The Point episode “Destiny: The Hardcore Gamer’s otherwise destructive behaviors. Slot Machine” at http://www.gamespot.com/videos/ 4 For a criticism of the Austrian concept of spontaneous the-point-destiny-the-hardcore-gamers-slot-ma- orders, see Sandefur (2009). chine/2300-6425852/. 5 Although V.L. Smith (1994, 113-115) contends there are 12 See the Destiny sub-reddit, https://www.reddit.com/r/ likely more, the seven reasons he lists for economists to DestinyTheGame/comments/2ry8bj/can_some- do experiments are to: 1) test a theory, or discriminate one_here_explain_how_the_loot_drop_system/, and between theories; 2) explore the causes of a theory’s Anthony Taormina’s 2015 article “Destiny’s New Loot failure; 3) establish empirical regularities as a basis for System is a Huge Improvement that Rewards Player new theory; 4) compare environments; 5) compare in- Effort” athttp://gamerant.com/destiny-review-loot- stitutions; 6) evaluate policy proposals; and 7) test in- system-151/. stitutional design (V. L. Smith 1994). As it relates to the 13 See James Plafke’s 2015 article “Destiny’s current paper, video games most fittingly serve pur- Microtransactions are Getting Out of Control” at poses 1, 3, 4, and 5, though they could conceivably fit http://www.geek.com/games/destinys-microtransac- purpose 7 as well. tion-pricing-is-getting-out-of-control-1642198/. 6 Notably, Destiny 2 attempts to address some deficien- 14 See Brenna Hillier’s article “Destiny: How to Get a Raid cies (as perceived by some of its player base) within Group Together Using LFG Sites” at https://www.vg247. the matchmaking system through the introduction of com/2015/02/10/destiny-how-to-get-a-raid-group-to- gether-using-lfg-sites/.
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REVIEW The Infidel and the Professor: David Hume, Adam Smith, and the Friendship that Shaped Modern Thought by Dennis C. Rasmussen GORDON GRAHAM
Web: http://gordon-graham.net
Princeton & Oxford: Princeton University Press, 2017, 316 pages. $29.95
This is a highly readable, meticulously researched, and eral times. It is evident, I think, that Rasmussen does not superbly produced book. Turning the pages is a wonder- merely admire Hume; he venerates him. ful reminder of how poor a substitute e-books are for the Is there anything wrong with this? What people com- best that fine paper, printing and binding have to offer. monly mean by hagiography is the embellishment of a biog- Princeton University Press is to be warmly congratulated. raphy by fanciful invented episodes that only the credulous To those reasonably familiar with the lives and writ- would believe. Nothing of this sort appears in Rasmussen’s ings of Hume and Smith, Rasmussen’s book will not have book. His claims are all as well grounded as the evidence anything very novel to add, but it is undoubtedly, as one of will permit. And yet there are more subtle hagiographi- 73 the puffs on the back cover says, “an appealing introduc- cal elements. Let us suppose, though it is a matter to be tion for the novice”. Yet, it presents the novice with a fa- returned to, that Hume was regarded in his own times as miliar, but highly distorted picture, in which Hume is the the opposite of a saint, someone who mischievously sought Enlightenment hero (with Smith his admirably faithful to undermine accepted values, and make a mockery of the young, or younger, friend) who battles to bring light to con- simple faith of ordinary people. Rasmussen systematically COSMOS + TAXIS + TAXIS COSMOS temporaries sunk in the darkness of religious bigotry and inverts the meaning of the terms in which this judgment intolerance, and is abused and reviled as a result. To my sometimes found expression. Thus ‘infidel’, the word he mind, the book prompts this question: At what point does uses in his title, becomes a term of commendation, mean- biography become hagiography? ing ‘enlightened’, with the consequence that “notorious in- As Rasmussen notes, when Hume moved from the fidel” is an even greater compliment. Conversely, Hume’s Old Town of Edinburgh to a more spacious house in the critics are invariably referred to “the pious” or “the devout” Georgian New Town then under construction, the street in in a way that makes these negative terms, synonymous with which his new house stood had not yet been given a name. ‘bigoted’ and ‘blinkered’. Relatedly, the educated Scottish Someone, perhaps a young woman to whom he was close, clergy with whom Hume engaged intellectually, and among chalked “St David Street” on the wall. The name stuck, whom he counted many friends, are referred to as such only though almost no one who lives there nowadays knows how occasionally. The term Rasmussen prefers is “Edinburgh li- it came about. The appellation was something of a joke, of terati”. course, since Hume was held to be a religious skeptic, and This helpfully sets them apart from their religious af- above all a scourge of superstitious practices such as the filiation, though the label cannot accommodate Aberdeen veneration of saints. For Rasmussen, it seems, the appella- clergy such as Thomas Reid and George Campbell, who tion turns out not to have been a joke. Hume was a saint, thanked Hume for the intellectual stimulus he had given if by saint we mean someone who approaches “as nearly to them, or Alexander Gerard to whom Hume (among others) the idea of a perfectly wise and virtuous man, as perhaps awarded a prize. Nor does it do much to explain the offer the nature of human frailty will permit”—Adam Smith’s fa- of employment from Lord Hertford “noted for his religios- mous final tribute to Hume, which Rasmussen repeats sev- ity”, and with whom Hume seems to have formed a most satisfactory relationship. How does this appointment fit
REVIEW The Infidel and the Professor: David Hume, Adam Smith, and the Friendship that Shaped Modern Thought by Dennis C. Rasmussen ------Theory ), he did not have much sense much the of did have he not real), Hume supportedHume the an idea of established religion, giv In the essay Superstition ‘Of and Enthusiasm’ ex Hume observes two in or one places, unlike Smith the (in Sentiments Moral of religionrole could in play the lives those of not were who the middle“of life. station” of Whatever Smith’s personal religious beliefs been, have understood he may a deep how belief in a justly universe ordered could elevate the lives of waswhose people lot mostly endlesstoil, and could provide consolationsome the to innocent victims violence of and never exhibitednever the fearful, tearful penitence that of some mightthe wished have ‘pious’ him Rasmussen, do. to on theother hand, isdetermined thatfaced he death cheer fully, without in a letter thought consolation. his to of Yet brother John,written ‘pious’ just his months a few before death, writes Hume bless Black “Dr him) tells (God that me . . . I shall with dye greater much tranquillity in David’s St StreetBesides,. . . can where expectI spiritual Assistance so consolatory as from Dr Blair and Dr Robertson? to Not a casualmention Exhortation from Carlysle from or you.” Could write Hume Rasmussen’s this letter sincerely? Was panderinghe mockingly he ‘piety’? his to Was brother’s blessing his gently he ridiculing attentive Was physician? his three clerical friends? The existenceof desire any for consolatory spiritual assistance, seems, it is incompatible with enlightened sainthood. So what this about letter from St David? commonwith (in ing preference mostScottish Protestants) a religionto that places ‘improving’ sermons the at heart its observances.of Why was this? religion something Was that had be the to to fed poor and ill-educated prevent to disturbances and make with them content their social sub servience? if this I doubt held Hume as but Rasmussen view, sured,that they degrees are few a but from brutes”, removed and the persistence religion, of concludes, he cannot be sim foolishness.ple “an inexplicable is a “riddle”, It mystery”. In the face this of says, Hume mystery, his only recourse is maketo his “escape into thecalm regions philosophy”, of from which course,of another at time, backgammon was called rescue to upon him. has There ‘truepressly to much debate been refers religion’. as whether to really he believed there was such a thing, andas (elsewhere) just what meant he identified when he it does he But say inin a “species a letter, philosophy”. a of spirit rather agnostic more than atheistic, that only he re cords doubts, and the leaves matter convictions of oth to thisers. Perhaps serves explain to a measure ambivalence of theeven at time hisof death. seems It certain that Hume ------with an easy emphatic or when he recounts when he “the beliefs our of Natural HistoryNatural
Natural HistoryNatural
This is a major flaw on Rasmussen’s Thispart, on flaw is a major Rasmussen’s I think, because Thisleaves us askingwe what to makeare of all those entirely destitute religion. of If find you at them all, be as Calvinist take far “pious”’ at offence from Moreover, this? concluding the dismissal religion, of muses. Hume a people “Look for out brethren the Catholics”, and his in the contention same placethat the doctrine the of Real Presence Christ of is “so absurd that all eludes it argument”. of Why force would the Protestants in general and Calvinists in particular. Equally been would have thewelcome mocking adopts he in tone the tions and his of temper own times. On the contrary, what writeshe “monkish about virtues”, superstition and “friv observances”olous been the to would have music ears of religion was, and remained, begin ambivalent. with, To and contrary what to Rasmussen often implies,more no thanelse anyone did rise he the above completely assump question side. one to overlooks theit fact attitude inconvenient that to Hume’s sustained only the by desire protectto theirsocial stand ing. This alternativeby not bornout is any evidence.Their re-classification as “literati”, allows happily, to us lay the their tolerance and affectionHume becomesfor unintelligi Ifble. say they we not, then were their religious affiliation, it waswould appear, superficial,hypocritical, self-serving and of hisof intellect, and many counted whom themselves of personalthey were or not, they, among friends. Were and “devout”? “pious” Rasmussen’s If say they we were, Moral Philosophy. tolerant Hume, of admiring were who clergy others), (and conceived attempt excommunicate to Hume, as well as Principal the of University Edinburghof Hume, where for reasons that remain obscure, had failed get the to Chair of that Robertson was the of Moderator Church Scotland’s of General Assembly many for years, which rejected an ill- about Hume’s health Hume’s about expressed William by Robertson in a letter Smith, to and the great loss Robertson says Hume’s deathwould constitute. in does note He the not same place ordinary clergyman, Minister but the of High Kirk St of Giles, and the most popular and effective of preacher his Similarly, Rasmussenday. notes the concern and solicitude that the of one Edinburgh Hugh clergy, Blair—“who was a minister, recall”—should expressly agree with Smith’s fi nal tribute is worth Hume. to It adding that Blair was no with “the customary clamour against irreligion” Hume’s which,Rasmussen tells us, was a key factorin the end ingRasmussen his employment? expresses surprise some VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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injustice. This important function, Smith thinks, “is of too ing Christian. It is possible to read Thomas Reid in this light, much importance to the happiness of mankind, for nature and Hugh Blair described the Dialogues as “exceedingly el- to leave it dependent upon the slowness and uncertainty of egant”. If this is correct, then the Dialogues leaves open the philosophical researches” (TMS III.V.2). If, as Hume sug- possibility of what the times might have called ‘enlightened gests ‘true’ religion is indeed “a species of philosophy”, it religion’. According to Rasmussen, however, nothing of this may serve to enlighten the educated and well-to-do, but it sort is left open. “[I]n his published writings [Hume] had al- has nothing to offer the vast majority of people, living lives ways refrained from marshalling all his sceptical challenges of a kind that Smith seems much more cognizant of than at once, thereby appearing to leave some kind of refuge for Hume. the devout. . . . The uniqueness of the Dialogues lies in its There is no doubt that Hume differed sharply from many comprehensiveness, which leaves the pious reader no way of his contemporaries on the matter of religion. He thought, out, no safe haven” (p. 188, my emphasis). Is this view borne as anyone who regarded the previous century could hard- out by the text of the Dialogues? Or is it rather, the view that ly fail to think, that religious conflict had been enormously Rasmussen would like to borne out by them? damaging. Strictly speaking, however, it was religious fac- In Hume: a philosophical biography (2016), James Harris tionalism, not simply religion in itself, that had caused so argues persuasively that the form of the Dialogues is essen- much suffering and disorder. Hume’s bête noire was faction, tial to them. That is to say, this is not a philosophical refu- political no less than religious, which is why he often lumps tation that happens to be cast into a dialogue and might as “Whigs” and “Tories” with “Christians” in the class of the well have been a treatise. Rather, it is an exemplification of dogmatically partisan. Rasmussen misses this, I think, and how the discussion of contentious and difficult philosoph- ironically commandeers Hume as a partisan on the side of ical subjects, on which equally serious opinions differ, can an anti-religious faction. This becomes clear in his treat- avoid faction and dogmatism. It is a literary demonstration 75 ment of Hume’s Dialogues Concerning Natural Religion. of how Hume thought ‘enlightened’ philosophy ought to There has long been an assumption that Philo is Hume’s proceed. The implication is that, contrary to what has been voice in the Dialogues. This assumption confronts an inter- supposed almost without demur since Kemp Smith’s edi- pretative puzzle. If Philo is Hume, what are we to make of tion, Hume has no voice in the Dialogues. His own voice is Philo’s conclusion right at the end, that “a person seasoned the irenic one that composed the work. This way of constru- COSMOS + TAXIS + TAXIS COSMOS with a just sense of the imperfections of natural reason will ing the text does not solve every interpretative puzzle, but it fly to revealed truth” and that “to be a philosophical sceptic does allow us to take it seriously without impugning Hume’s is, in a man of letters, the first and most important step to own integrity. Philo’s is not Hume’s voice. He is Hume’s in- being a sound believing Christian”? Why, moreover, does vention, and consequently these closing statements are not Hume not endorse Philo’s scepticism, but conclude the stratagems to appease the wrathful ‘pious’ (post mortem!), whole work with the judgment that “Philo’s principles are but a final acknowledgement that no one position can dog- more probable than Demea’s, but that those of Cleanthes matically insist on being the last word on the subject. It did approach still nearer to the truth”? Is this Hume being in- not prove easy for Hume’s critics to see the Dialogues in this authentic out of caution? Why would he see any need to do light. Rasmussen’s treatment of the work shows that it does that? This was a work that he was very keen to have pub- not prove much easier for his admirers to do so either. Thus lished, but the public, he knew, was not going to see until af- it was predictable that (some of) the ‘pious’ would castigate ter his death when he would be beyond any “clamour” that Hume for them, and this may explain Smith’s hesitation in it might cause. taking on responsibility for seeing them to publication. But In The Moral Culture of the Scottish Enlightenment 1690- it is no less predictable that convinced atheists would find in 1805 (2014), Thomas Anhert makes a very strong case for them a vindication, and hence a reason for Hume’s venera- thinking that the moderate Scottish clergy whom Hume tion. If Harris is right, both parties have missed the point. knew well, would have subscribed to a view something like Rasmussen correctly observes that “nearly everything Philo’s. They had a more “just sense of the imperfections of Hume wrote bears on religion in one way or another”. It is natural reason” than the more zealous Calvinist, and this a subject that seems to have had a great fascination for him. made them more inclined to look for “revealed truth”. It Yet Hume, in my estimation, lacked any religious sensibility, may even have inclined them to the view that being a philo- in a way that Nietzsche, for instance, arguably Christianity’s sophical sceptic is an important step in becoming a believ- fiercest critic, did not. When it came to religion, Hume, we
REVIEW The Infidel and the Professor: David Hume, Adam Smith, and the Friendship that Shaped Modern Thought by Dennis C. Rasmussen
------Dialogues , Witherspoon, . (very briefly) briefly) and (very sever . Since. the proved work Theory Moral Sentimentsof fared rather edi better. Five . In the chapter that devotes he to inthe interests religion of History England of Wealth of Nations Wealth Political DiscoursesPolitical Wealth of Nations Wealth Wealth of Nations Wealth Rasmussen is careful overstate to his not case, un he but This aspiration‘unityto a of science piety’ and con Smith’s most famous sections Smith’s of most famous book . . . are lifted straightsimilar a [since] Hume from narrativepres is inent both the al volumes of the doubtedly attributes very a significantHume to role in the gestationthe of influential,hugely own philosophical Hume’s then even if tinued be to influential long into the nineteenth century, and the Scottish philosophers studied were who included andHutcheson Reid, and later Brown and Hamilton. By contrast, after the third 1804, editionHume’s of reprinted Something not untilwere the of 1875. same gap occurred almost for all his was works. It the twentieth cen tury philosophical Hume’s before began work attract to se rious attention again. tionsappeared in his lifetime, many editions after his death, and the has print. work been of never out Furthermore, it isby possibleit both find to madeto reference British and American politicians and policy makers. Rasmussen makes a case thinking for ideas influenced the Hume’s Smith very significantly,only not in the which many also commentators but would agree) (about in the it, Rasmussenpresence findsin Hume’s several important places.notes that He Smith himself identifiedHume as the writer sole noticed have to the wider social impact the of growth and manufactures” “commerce of and particular personal the of ly on promotion liberty and security. is He even prepared say that to the “basic the outlines” of “one of a key figure Johnit in is Witherspoon. Witherspoon was al lied the to evangelical “Popular” or party in the Church of Scotland, and so unquestionably falls within Rasmussen’s became he the of InPresident category 1768 “the of pious”. College Princeton Jersey New of (subsequently University). AsPresident, and modernisedthe curriculum introducing by experimental science andthe moral philosophy Francisof Hutcheson, the‘Father’ of Scottish Enlightenment. A leading activist in thePresbyterian Church in the States United and signatoa ry the of Declaration Independence, of under Witherspoon Princetonprovided steadya stream the leaders of for new Republic in politics, and law education. Similar curricular emulatedreforms were across the is this country. How pos ifsible Scottish enlightenment andpiety as were far apart as Rasmussen depicts them? ------, Handel of ‘science ‘science of unity The Scottish Enlightenment St Matthew Passion (1971) recounts this history, and (1971) to people, to still less matters it why , and, Charles wrote verses Wesley matters The Messiah The .
This is an especiallysignificant matter for Rasmussen’s The The same might be saidof Rasmussen. His accounts and American College Ideal ment, andment, shaped college of the education in development the American colonies, and subsequently the States. United celebratedDouglas book Sloan’s quires a conception that us employ to can findplaceno in the picture paints. he This is ideal the of the pursuitand The piety’. of thisideal underlay the establish ly ‘shaping’ in this context means. The important point is that here the note to of one ways modern thought was shapedthe by times which about Rasmussen writes, re book. means He be to an it account “the of friendship that shaped modern I will thought”. return the to matter friendship,of and aside the leave question what exact of do not have a monopoly on it, and on philosophers, a monopoly have not do appears, it can their have share. cerned, is seems, not, it a possibility that ever need we take religious Indisputably, seriously. adherents their have share intolerance,of and prejudice narrow mindedness. they But influenceof false philosophy on human the heart” of which Horne, the Vice-Chancellor Oxford of warned, and about which philosophers Nietzsche to from Plato been have con Hume acknowledged,Hume among his most highly educated con temporaries. has criticismsonlyno he JohnWesley offer, to “thunders” denunciation, and the “baneful and pestilential Archbishops,can only construe them as diatribes nar of minded row intolerance. evidentlyHe sees nothingthat might be learned from such people, despite their being, as so much example, the for of and Bishops ‘attacks’ by, Hume on with critical acumen, wit and occasional insight. There is nonetheless any never sense in his writings that appreci he ated why religion be generated by a “species of philosophy”. Thisbe a “species generated philosophy”. by of lackof sen sibility from Hume writing did prevent not religion about poems ever written in the English language. these of None examples fits the categoryof ‘frivolousobservance’, it is and absurd suppose to that everything good them about could 50 years, Bach composed the composed that came be to regarded as among thefinest devotional wider conception religion of escaped him. In the period that great was Hume architectural writing, Wren’s master piece—St Paul’s Cathedral been --had in existence lessthan might say, was deaf, tone might and say, along with Smith, uncriti he callyaccepted theScottish Calvinist’s narrowconception of religion as theological doctrine moral plus injunction.Any VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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writings fell into the shadows for a good many decades, many matters, and there are striking parallels in some of there is some support here for the subtitle’s claim that it was the things they wrote. Hume’s influence can be detected not their friendship that shaped modern thought. only in the Theory of Moral Sentiments, but in the Wealth But what do we really know about that friendship? A of Nations. While there have been lengthy periods of ne- perpetual source of frustration to biographers of Smith has glect, their writings have generally stood the test of time, been the lack of material relating to what we may call his and continue to attract the serious engagement of philoso- inner life. He was not a great correspondent, and any pa- phers and economists today. All these propositions are true. pers that might have given some indication of thoughts he Even in combination, however, they fall dramatically short had not published, were probably among those his friends, of supporting the claim that this was “the friendship that on his instructions, destroyed. Even the evidence of what shaped modern thought”. he did, where he travelled, whom he met is on the patchy side, and evidence for what he felt and believed is virtually non-existent. Our knowledge of what he thought is confined to what he thought fit to be published. Every biography, accordingly has of necessity to include a large measure of surmise—probably this, and possibly that. Rasmussen’s ac- count of Smith and Hume’s friendship is no less given to surmise. There is undoubtedly evidence of friendship, but at one point Rasmussen describes Smith as Hume’s closest friend. What are the grounds for supposing the Hume’s friend- 77 ship with Smith was closer than many of the other warm relationships he had (with Drs Blair and Robertson, for in- stance)? It is impossible to overlook the fact that for long periods they did not meet, and for equally long periods they do not appear to have corresponded, or if they did, we no COSMOS + TAXIS + TAXIS COSMOS longer have a record of it. It seems that Hume often urged Smith to visit him in vain. When they were both in London for several months, Rasmussen says “we can be sure that they spent some of this time together”, but he is obliged to add, “though there is virtually no record of it”. When they overlapped in Paris, Rasmussen says that “Hume surely would have introduced Smith and the young duke to some of his Parisian friends and admirers”, only to add “though there is little record to go by”. Over the long years in which Smith retired to Kirkcaldy, his home town, to work on the Wealth of Nations, he was a relatively short distance by sea from Edinburgh, but visited very occasionally. Remarking on this period, Rasmusssen says “though Hume and Smith had seen each other very little in the previous three years, they did their best to make up for lost time”. Once again he has to add, “Unfortunately, there is little surviving evidence of what they did or said during this time” (p. 207). It’s just a guess, then, that whatever they did, or did not do, was nev- ertheless “making up for lost time”. Hume had many good friends. Smith was one of them. He wrote a beautiful account of Hume’s last days, and made him a most eloquent tribute. They shared a view on
REVIEW The Infidel and the Professor: David Hume, Adam Smith, and the Friendship that Shaped Modern Thought by Dennis C. Rasmussen ------of allof thoseformal rules, governmental support, The The book addresses in depth the institutional structure thehistorical case reviewed could also be broadly inter preted as factual evidence the of real possibilities robust of institutional heterogeneity in banking, voluntary and how forms decentralized of self-governance, liability contracts, and polycentric structures are robust private means ef of ficientlygoverning banking matters without need for the centralizing banking services (Paniagua 2017). stability financial of markets. Scotlandoperated in a highly competitive and lightly regulated environment that had no central bank act to last as of a lender resort, monopo no list issuer currency, of legal no restrictions ex no entry, on ante binding limits the on number and size banks, of and fi nally despite capital no and Yet reserve 7). requirements (p. the lack institutions, the Scottish bank state-created explicit and ingsystem was remarkably stable and more robust than the English system. Scottishof banks and the wide forms bank of competition during the Scottish free-banking period, both which of helped the banks the resilient become to system) more (and than their English counterparts. also It explores in depth the regulatory environment in which banks operated, and thehow ‘regulatory quality’ that of environment devolved interest to due groups More and involvement. government critically,discusses it the and endogenous collaborative in stitutional and contractual arrangements that banks gen themselveserated (among and with their to shareholders) andattempt endogenously to such privately problems solve as last of lack a lender of resort, volatile capital outflows, and banking crises without needing Indeed, an agency. outside effectively absorbed several shockseconomic that affected the economies Scotland of and England and threatened the ------by Tyler Beck Goodspeed Beck Tyler by
INTRODUCTION INTRODUCTION Approximately from 1716 to 1845, Scotland’s 1845, to bankingApproximately from 1716 Despite the fact that Goodspeed’s book does address not
petitive banking systems in Europe. The Scottish system (or at least at illuminate(or the dangers ill-conceived of reform). system was among the most dynamic, resilient, and com scrutinize history find to successful banking experiences and compare them institutionally with our existent ones, so thatthey might illuminate the path institutional to reform shaping the reforms of financial and sector, the fragilityor resilience alternative of banking systems. in Conceivably, build to resilient order more banking systems, should we ry Scotland, has it substantial but contemporary relevance and invaluable insights policy for makers in regards the to perils banking of regulation, the interest of groups role in role of banks of role and regulation in economic crisis and where pursue to institutional reforms. Goodspeed’s book is revia the of sion history banking of episodes in eighteenth-centu ing the Scottish free-banking period and his interpre novel tation the bank (Douglas, of Ayr & Co.) crisis Heron are a fresh contribution that has relevance understanding to the inherent fragility banking of systems. the current financial crisis, his historical analysis concern This emphasison banks hasobviously ledgovernments to speciallay focus banking on and reform banking restric tions, and a severely pessimistic adopt to view regarding the Recession literature attribute to the to banking sector and itsfragilities the causes and length the of economic crisis and its capacity rapidly to the to spread economy. whole makers and economists are still discussing should we how our reform bankingsystems so that they canresil be more has become It ient. conventional wisdom in the post–Great 1. after Years recent economic the bankingand crisis, policy Cambridge, MA: Harvard University Press, 2016, 224 pages, $39.95 224 pages, 2016, Press, University MA: Harvard Cambridge, PABLO PANIAGUA PABLO https://www.pablopaniaguaprieto.com Web: Legislating Instability:Crisis Adam of 1772Smith, Free Banking, and the Financial REVIEW VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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Before 1765, the collapse of a bank did not entail any sub- tions to ‘free banking’” (p. 7). Hence understanding how stantial threat to the stability of the system, mainly because the Scottish system actually functioned, and identifying its no single bank acquired sufficient size, interconnectedness, contractual and market mechanisms and how well it dealt and systemic importance that its failure would constitute a with crisis, is a valuable way of understanding how a real severe menace to counterparties and credit markets. Even (close to an ideal) free banking system could actually func- if a bank had done so, the system had contractual mecha- tion. nisms, such as optional clauses and unlimited liability, Second, the system suffered in 1772 a financial crisis that for mitigating systemic shocks (p. 137). The biggest threat severely threatened the system. This crisis has been con- to the Scottish system occurred during the financial crisis sidered by banking scholars an indication of how fragile a of 1772, in which sixteen banks failed. Goodspeed revisits banking system would be in the absence of other institu- this experience in detail, arguing that prior regulations and tional features such as stronger regulation, a lender of last impositions from seven years earlier severely undermined resort, or even a central bank. Hence understanding the banks’ resilience and flexibility to deal with the crisis. The timing and legal context of the 1772 Ayr crisis, particularly fact that Scottish free banking and the Ayr crisis occurred in light of the recent drastic changes in the regulatory en- during the time Adam Smith was working on The Wealth of vironment in 1765 and the political and macroeconomic Nations makes this historical episode particularly remark- context in which it occurred, would help to clarify mis- able. Goodspeed revises Adam Smith’s arguments concern- conceptions and doubts concerning the resilience of real ing free banking and regulation, concluding, contrary to free-banking systems and their vulnerabilities in the face of Smith’s claims, that the crisis, far from revealing the weak- regulatory changes. nesses of free banking, actually supplies important lessons Finally, the third reason concerns the unique role that on ill-conceived and ill-implemented banking reform aris- regulations and restrictions play—both directly and, indi- 79 ing when banks as interest groups engage in regulatory cap- rectly, by interacting among themselves—in the evolution ture. and erosion of the institutional structure of banking and finance. The Scottish experience offers a unique opportu- 2. THE BOOK ITSELF nity to identify the first- and second-order systemic and institutional effects of banking regulation, and how they COSMOS + TAXIS + TAXIS COSMOS The nearly 130 years of success of the Scottish free-banking can interact and unintendedly undermine other existent in- period is of particular interest, not only for the history of stitutional features that are relevant to sustaining banking banking, but also to understand alternative and plausible resilience. In addition, it sheds light on how additional and institutional banking arrangements that could be more unforeseen regulatory complexity and interventions emerge resilient and stable than contemporary ones based on cen- from the unintended interactions among restrictions, and tral banks. If we are indeed interested in reforming bank- how that complexity is created from regulatory capture and ing systems so that we could avoid or at least ameliorate vested interests. Particularly, it illuminates how top-down the damage of economic crisis, then we should seriously or ill-conceived and politically-led regulations can—even analyze all the real institutional possibilities or structural when well intended—interact among themselves, with prior liability reforms that we have available. The case of free existing restrictions, and with institutions, exacerbating the banking in Scotland is particularly important for us today fragility of the entire system and bringing severe costs to in a post–Great Recession world, especially in understand- society in ways that are impossible to foresee. Regulatory ing contemporary debates on banking reform, which type interventions therefore might not only have direct adverse of regulations to undertake, and more broadly how sound effects, but more critically, as the case of the Ayr Bank and resilient a free-banking arrangement would be com- suggests, they can have severe unexpected destabilizing pared to a centrally controlled one. I consider this case rel- interaction effects, undermining the whole institutional evant for three reasons. structure. First, the Scottish system has been one of the closest (if Thus there is a complex nonlinear relationship between not the closest) banking systems to that proposed in the politics, regulatory changes and the institutional develop- theory of free banking: “Scotland from 1716 to 1845 is ment and fragilities that such regulations and their interac- widely considered by economic and financial historians tions will generate. In other words, there is vital aspect of to have been one of the closest ever historical approxima- institutional and governance structures related to their en-
REVIEW Legislating Instability: Adam Smith, Free Banking, and the Financial Crisis of 1772 by Tyler Beck Goodspeed ------the crisis crisis the before Chapter 1 also reviews the crisis how Ayr is a great ex Whenregulations and restrictionsare largely designed Chapter 1, “A Very Melancholy Situation,” starts Melancholy Situation,” Very with “A a Chapter 1, to satisfyto concentrated interests, there is a substantial un perceived“institutional-fragility cost” that is shifted from the key institutional the into society, rest onto players or theof institutional structure. In other words, the dynam ics regulatory of capture entail substantial concentrated monetary benefits for interest at groups, the expenseof the transfer and dispersal institutional of fragility and its costs: the transmission institutional of fragility and financial risk tion small-denomination on banknotes, a maximum legal rate interest, of and contingent-liability of a prohibition banknotes—“were already seven law years curious More 1772. of still is the realization that these re strictions in … were reality the products intense of political lobbying” 6, emphasis in (p. original). whatampleGeorge of Stiglerdesignated the “theory ecoof regulation”—specifically,nomic dynamicsthe regulatoryof capture.In the Scottish case, Goodspeed that shows have we a great example in which agency a government a regula or tory body designed and intended serve to the public interest “in instead fact serve[d] mainly advance to private concerns withconcentrated interests in the regulated sector … The crisisitself presents starka warning the of risks posed by regulatory capture, particularly in financial markets” (p. this Perhaps is the most relevant argument21). Goodspeed givescrisis as the why to espe 1772 is relevant us today, for ciallyin the context the of international banking reforms such as Dodd-Frank among others, since sheds it light on bankinghow regulation and restrictions do not necessar ily in work the public interest and build to resilience in our systems. In fact, quite the could opposite occur. Despite those the system changes remained however, stable and responded relatively well in the face such a severeof crisis. global short introduction the to historical context in which the crisis occurred. Goodspeed brieflyreviews the unfolding crisis—in theof 1772 particular,the liquidity problems Scottishfor bills in the discount London market, and how that affectedrefinancing and short-term ofrollover the Scottish of debt banks. The crisis affected several banks’ liquidity and soundness, most importantly but ruinedit the “banking behemoth” Douglas, & Co., the Heron Ayr Bank.Goodspeed reviews Adam how Smith, during 1765 and1772, advocated more regulation and restrictions on banks deal to with the The contradiction problem. however is that the reforms Smith advocated—mainly, a prohibi ------the 1772 crisis,the 1772 rather but that caused
Despite these conclusions, Goodspeed clarifies that “it is Goodspeed’s central argument is“that the salient [1772]
undermined during the regulatory changes 1765–72. of ity”(Ibid., emphasis in original). The historical evidence suggests that the institutional and systemic resilience of the Scottish system drastically changed and was severely previously exhibited Scottish by finance, and el thereby evatedthe risk that adverse financial economic or shocks might metastasize threats into broader financial to stabil not my contention that contention the my not introduction legal of restrictions into Scottish banking they critically undermined the flexibility resilience and banking,and therefore, ultimately, amplifying the levelof systemic risk” (Ibid.). restrictions banking; on regulations that had the effectsof raising barriers loweringentry, to competition in the pro vision credit, short-term of increasing the efficient scale of Goodspeed notices that this be should sur not conclusion prising, acknowledge we once that “the oldest, largest, and most established banks in Scotland … legal for … lobbied Smith, rather made more than less likely precisely by those regulated “unfree’ or Scottish of elements banking which Wealth8). thepromoted”Nationsof The (p. of author financial crisisof the Scottish free banking period, the obtrusive exception the to hypothesis greater of financial stability underfree banking inScotland, was, paceAdam banking systems that regulations could bring, should be vi tal theoretical aspects economic regulation. of regulation a very difficultand dangerous task. Recognizing those potential institutional and erosions fragility costs, alongside the dangers enlarging of the systemic fragility of the system” (p. 22). Therefore, regulatory Therefore, 22). the matters system” (p. cannot be dissociated from institutional dynamics and changes, sys temic risk, and making complexity, the art politically-led of connected financialnetworks—can exacerbate the risk that adverse shocks are amplified propagated and throughout banking fragility and its negative spill effects over into other markets in ways that are unforeseeable.“add Thus ing complexity systems—such complex to as highly inter restrictions in implemented a nonlinear highly complex environment, might actually the have tendency reinforce to severely eachincreasing other negatively, both systemic imposed political legislative or means. In fact, Goodspeed’s analysis actually demonstrates that ill-conceived and in terest-group-captured regulation in concomitance with dogenous changesdogenous and their evolutions, that is significantly attempt regulate to we related how to and alter their envi ronments and legal context; either through exogenously VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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to the rest of the system and the enlargement of systemic misapprehensions around the freedom to issue small notes risks. Hence “capturing agents are essentially incentivized and the use of optional clauses. to produce negative externalities … [T]hese negative exter- The Scottish economy was a small open and fast-grow- nalities can be especially costly when reduced competition ing emergent economy with a fixed exchange rate, open to gives rise to systematically important financial institutions” large, volatile capital inflows and outflows that contributed (p. 22). to generating a balance-of-payments crisis and immense The core insight here is that, institutionally speaking, pressure on the financial system. Since the economy expe- regulations and restrictions are not only not positive sum, rienced large capital outflows due to international political but also, quite certainly, negative sum. Banking regulation events, the issuance of small notes was a rational endoge- not only may not work to satisfy the public interest, but nous response of the system to provide liquidity and credit through time it can also undermine and deeply damage in the face of an acute shortage of circulating media, par- the public interest and their well-being, through destroying ticularly when big banks curtailed credit to attempt to ride and eroding the long-term existent institutional resilience out a real exchange rate depreciation. This 1760–65 period of a given system, making it more fragile and increasing its of relatively higher issuance of notes cannot be considered systemic risk. This is a relevant contribution to the theory “manic” since it did not produce any marked difference in of economic regulation and institutional analysis since it inflation rates in Scotland when compared to England (pp. suggests that the social cost of regulatory capture is quite 45–47). Furthermore, regarding the privately issued notes, difficult to measure in quantitative terms. Its greater cost is a secondary and very dynamic market developed in which increasing: regulatory complexity, long-term institutional “there was certainly no shortage of willing bankers and erosion, and a gradual enlargement of the systemic risk and agents to exchange them … [A] considerable ecosystem of the spill over effects of banking failures into the rest of the quasi banking and clearing institutions formed around the 81 economy, which amounts to more than a single shift in the issuance of small commercial banknotes” (p. 52). cost-benefit equilibrium of the system. It seems the biggest The optional clauses, on the other hand, were rarely used welfare cost of regulatory capture resides in its capacity to and exclusively applied against “high-volume English spec- undermine through time the resilience and the welfare-en- ulators and arbitrageurs.” The clauses were “essentially a hancing properties of a system as a whole. private application of capital controls on large ‘hot money’ COSMOS + TAXIS + TAXIS COSMOS Chapter 2, “Beggarly Bankers,” analyzes—contra Smith— outflows” (p. 30). The optional clauses therefore, were useful the positive role that the emergence and proliferation of the also to allow illiquid but solvent banks to liquidate assets so-called “beggarly bankers,” or the small-scale note issu- without precipitating fire-sale losses and to form an orderly ers, played in actually bringing greater credit competition, backstop against bank panics, and emerged endogenously diversification of risk, and macroeconomic stability; ele- from the oldest and biggest Scottish banks around 1730, ments that contributed to building a remarkably resilient which were originally trying to defend themselves from banking system that withstood severe adverse economic hostile note raids by rival banks. In addition, they eventu- shocks prior to 1765. Goodspeed reviews here the tumul- ally developed mainly as a useful and selective way around tuous years between 1760 and 1765, which comprehended banks’ inabilities to respond to massive international capi- a severe balance-of-payments crisis in 1762, and how these tal outflows and external drains of specie, in turn because events and the proliferation of small issuers affected Smith’s existing usury laws prohibited them to increase their de- theoretical views on banking. Goodspeed also challenges posit rates above 5 percent (p. 43). The optional clauses then Smith’s convictions that this period was marked by a “small were crucial to impose temporary and selective capital con- note mania” attributable to the freedom of banks to issue trols that “allowed time for the current account deficit to banknotes for sums below £1 in addition to the free use of sort itself out through nominal adjustments in the bills of dilatory optional clauses in banks’ notes. Goodspeed finds exchange market” (p. 128), while small-note issuers helped “not only little evidence of a ‘mania,’ but also that the al- to avoid a contraction in the money supply and additional leged banking offenses—namely, the issuance of notes deflation. in denominations bellow £1 and the adoption of optional These two features, though criticized by Adam Smith and clauses—were in fact rational and effective market respons- banking scholars, were the product of competition and vol- es to the very real challenges confronting the Scottish econ- untary freedom of contact, and both contributed deeply to omy” (p. 30). Indeed, this chapter severely challenges the the resilience and flexibility of the system (pp. 45–47). They
REVIEW Legislating Instability: Adam Smith, Free Banking, and the Financial Crisis of 1772 by Tyler Beck Goodspeed ------Setting aside the litigation among the Bank’s Ayr unlim In chapter 4, “Prodigals and Goodspeed Projectors,” Goodspeed exhibits a case here regulatory of capture, resilient the Scottish banking system remained, mainly unlimited to due shareholder liability, rules appropriate for rapidly sequestering shareholders’ assets and providing for their equitable distribution among creditors, and robust co partnery 100). agreements (p. itedly liable shareholders, the creditors and the depositors of bank fully were through restituted and 1786 between 1774 restrictions and limitations Scottish on banking enacted the “elevated systemic level of 1772 before risk in Scottish financial markets,” concluding “attemptsregulate that to specific categoriesof financial activity gen cantherefore simply offsettingerate not changes in bank but behavior, changes that interact in often unpredictable ways with ex isting institutions, as well as with unanticipated changes in economic circumstances” 138). (p. addresses the crucial that role unlimited legal liability of shareholders in Scottish banks in played increasing system stabilityic the of banking system and in securing a rapid recovery1772. afterHe also convincingly argues it that was actually theunlimited liability banks’ of partners that asworked an efficient of market-based lender last resort that disrupting avoided credit markets. Despite the regula tory changes explored in chapter 3 that severely damaged the overall institutional structure and resilience inherent in the Scottish system, Goodspeed recognizes that “Scottish banking nonetheless retained its resilience” of 25). much (p. This fact is particularlyrelevant since restrictions the on small-note issuance and optional clauses had a significant negative effect loweringin competition in Scottish credit markets. Nevertheless, Goodspeed sheds new light how on risk, and created a rare institutional environment charac the to terizedexit small-noteof vacuum” “credit a (due by thatissuers) increased the likelihood that the institutional banking of evolution would lead the to establishment a of difficult-to-oversee, larger, much more and systemically important institution, as eventually did occurred when the BankAyr was actually 89). established (p. in 1769 a substantial vested interest in the legislative process, and the extreme unintended negative consequences, “high or effects,”legalof er-order restrictions given the complexity and opacity banking of and financial markets. This case illustrates differentrestrictions how might actuallyrein each force other unpredictably and undesirably, producing nonlinear impacts banks’ on size, counterparty and sys temic risk, and institutional fragility. finds he Here that the ------direct consequences the of
The The act,prohibiting by both the issuancesmall of notes Chapter 3, “ProcuringChapter 3, an reviews Act,” the “high major
exit small-note of issuers, elevated the counterparty level of quence, banks “getting intercon were more bigger [riskier, act 1765 The 78). and them” (p. nected], of there fewer were therefore increased the efficient scale of banking,forced the from gold andfrom gold silver rivals’ toward big bank notes, and an increase in the frequency bank of failures less than (from In per decade conse 75–84). one than more to (pp. eight) tiallycompetition and lower bankfewer formations, drastic shifts in the composition and riskinessof banks’ assets and loan portfolios, shifts in reserves of the composition away specifically finds historicaland statistical of sub evidence stantial institutional changes as act, including an increase in the average bank size, substan “should hardly“should underly act] as [the come a surprise … [I]ts ing purpose was achieve to precisely did what it achieve … raiseto barriers He entry to and limit 61). competition” (p. operations exited the having market), the effect double of amplifying the risk assumed individual by banks and also the system-level risk. Goodspeed notices that this result and the optional inclusion of clauses, increased the efficient scalebanking. of Banks then substantially got bigger in size competition and(quasi-bankinglowered informal or bank previouslyenabled theScottish bankingsystem absorbto such volatility” 129). (p. tem to adverse shocks” (p. 61). Unfortunately, the Unfortunately, act “did adversetem to 61). shocks” (p. nothing resolve the to fundamental … while problem the at same time undermined it the of some strengths that had posed small-note mania. The act “did indeed curtail the is suance private of banknotes did … [T]hey so the at cost of exacerbating the vulnerability the of Scottish financial sys restrain the paper profusion currency of experienced dur ing and 1760–65, was it thereforelegal a response the to exaggeratedviews policy makers the had at time the on sup the insistence pressure of groups, the had on com prior petitive systemreviewed earlier. The act was to intended 1765 Bank Act,1765 reviews the details regulatory of capture in its formation and serves contrast to the drastic institutional effects that new act,the which was largelyat implemented aleffects restrictions 1765 that played the in dynamicsthe bankingof and the stability the of overall Scottishsystem. This chapter traces legislative the history origins and of the mission the to real economy. effects,”or er-order the unintended complexity-institution also allowed the system absorb to and contain international financial shocks whilereducing their capacitymetastato size into systemic banking panics and limiting their trans VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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the issuance of tradable eight-year, coupon-bearing bonds ing in” and making responsible and accountable the bank that were also secured by the Ayr shareholders’ personal owners and directors for the misbegotten bank behavior, assets and wealth (p. 113). With that mechanism, the Ayr the system also protected note holders, depositors, and Bank was converted into a sort of “bad bank” whose sole creditors and arrested the crisis and facilitated a rapid cred- function was to slowly work off its toxic assets and gradu- it and economic recovery. ally pay its creditors, while the assets and property of the Goodspeed shows that the unlimited liability of share- bank’s owners functioned as a financial backstop. This holders of the bankrupt banks essentially served the ho- particular market-based contractual solution to reassure, mologous role of a private decentralized lender of last resort pay, and protect creditors is a valuable example of how a since the sequestration of shareholders’ personal assets decentralized free-banking system could provide credible, “bailed them in” for more than their subscribed capital. organized, and legally enforceable private solutions to liqui- Moreover, even if shareholders transferred their shares, dations and bank failures. the partners still remained indefinitely liable for all debts This case illustrates how—even if a big bank fails in a incurred during their ownership (p. 116). This form of vol- free-banking environment, which is as plausible an out- untarily contracted lender of last resort, being market based come as in any other banking system—there are still sev- (apolitical) and free of interest groups, might actually be a eral liability regimes and financial mechanisms to provide more institutionally robust alternative financial mechanism credibility and security to creditors and mitigate counter- to provide stability and liquidity compared to a lender of party risk through endogenous and voluntary forms of con- last resort as represented by a government agency bailing tracting equity bail-ins. These forms of equity bail-ins have out banks by socializing losses and using taxpayers’ money. the positive effect of “unfreezing” and restoring calm and A key difference between the Scottish lender of last resort transparency to the credit and interbank lending systems, and its more common form today resides in the fact that 83 diminishing counterparty risk. They mitigate financial banks were indeed allowed to fail, and the cost of bankrupt- shocks that otherwise could have spread and affected the cy was borne by the banks themselves without inflicting real economy, while simultaneously allowing mismanaged losses on the rest of society. This should invite us to reflect banks to deservedly fail, in turn discouraging long-term more critically on how we allocate financial liability today “too big to fail” problems and moral hazard. Furthermore, (p. 139). COSMOS + TAXIS + TAXIS COSMOS the issuance of tradable bonds backed by the Ayr Bank en- These properties allowed the Scottish system to recover abled all its counterparties to quickly resume lending and quickly and to avoid a severe credit contraction that would discounting bills after 1773, as these bonds were used by the have affected the rest of the economy. Indeed, the recovery remaining banks as collateral for loans (p. 112). of the Scottish economy after the Ayr collapse is particu- Hence through unlimited liability of banks’ sharehold- larly telling concerning the comparative macroeconomic ers and the issuance of bonds to creditors linked to those recovery effects of alternative financial systems and differ- shareholders’ assets, the Scottish system had a built-in pri- ent liability regimes. During its collapse, the Ayr Bank was vate contractual mechanism to restore and unfreeze credit allowed to issue transferable bonds to its creditors in order markets whenever a banking crisis occurred. Through an to fully restitute its claims. The bond issue also allowed the expedient legal process of transparent, publicly advertised, bank to satisfy through time the creditors while providing and predictable sequestration and equitable distribution of an orderly liquidation of the company’s assets and those the banks’ and owners’ liquidated assets, the system miti- of its partners. From that time (1773–74), credit markets gated widespread bank panics and fire-sale liquidations (pp. thawed and the Scottish economy rebounded sharply (p. 100–102). 111). The 1772 crisis was, no doubt, severe. However, compara- This historical case suggests that systems that possess tively speaking and unlike the Great Recession, most of the sound, incentive-aligned, and market-based mechanisms social and economic losses and distress eventually ended for liquidating banks, in addition to “liability regimes that up being borne solely by the owners and directors of the (unlike static, technical rules) automatically generate vol- bankrupted banks themselves, which had done, after all, a untary contracted, countercyclical equity bail-ins, may in negligent job in securing sound banking practices, respect- fact challenge Reinhart and Rogoff’s conclusion that deep ing the principles of copartnery, and enforcing managerial financial crises necessarily entail long, slow economic re- rules (pp. 117–21). Simultaneously and positively, by “bail- covery” (p. 26, emphasis in original).
REVIEW Legislating Instability: Adam Smith, Free Banking, and the Financial Crisis of 1772 by Tyler Beck Goodspeed ------be
an financial ongoing crisis and in the middle of CONCLUSIONS FOR AN ANTIFRAGILE AN ANTIFRAGILE FOR CONCLUSIONS AGENDA RESEARCH the causes that of crisis are sufficientlyunderstood” (p. As evidenced throughout Goodspeed’s book, Scottish Finally, Goodspeed interprets the lessons from the 1772 institutional properties encourage the systemas to a whole evolve, learn, and gain from economic stressors. banking certainly resembled an antifragile system. The antifragility of notion resonates also with the concepts of institutionalrobustness and with polycentricity in political would be certainly It (Paniaguaeconomy 2017). notewor thy undertake to an antifragile research agenda develop to regulate fore 24, emphasis in original). seems It that not today have we taken that cautionary tale again once seriously, rushing to regulate banking without yet understanding the origins of the crisis. perhaps today are Hence we adding further com plexity and planting the regulatory seeds that will make the next severe. crisis more but likely, only not more 3. As suggested, the Scottish system and free banking in gen eral, possessed institutional and learning properties that greatly resemble systems that Nassim has designated Taleb antifragile. In other words, free banking possesses incentive and competitive structures, feedback mechanisms, and in stitutional properties that allow the system become to more robust from macroeconomic shocks It (Paniagua 2017). also has the discipline markets of and lacks bailout policies, which aligns the incentives individuals of in the system and incentivizes private bankers and customers their improve to behavior and market develop and contractual mechanisms based past on experiences. These incentives and virtuous disruptive” (p. 132). By increasing the disruptive”averagesize 132). banks, of (p. also it undermined in partthe benefits of unlimited liability in effectivelymonitoring management, thus making lackof managerial accountability severely problematic. crisis and the institutional and evolution demise the of Ayr Bank as ways think to thoroughly more “the about poten tial implications particular of types regulatory of change and institutional arrangements in financial markets” (p. This case137). is an illustrative banking examplehow of practices, systemic risk, and management are oversight severely shaped, limited, and times at undermined the by constitutional context and legal complex system in which banks see also 142; operate With Paniagua (p. the 2017). RecessionGreat in mind, Goodspeed considers the Scottish experience cautionary as “a tale the of risks rushing of to ------. The . The
institutionally contextualized
The 1765 legislation 1765 interacted The severely negatively and In chapter 5, “Upon DaedalianIn “Upon chapter 5, Goodspeed Wings,” ac This point is particularlyrelevant today for diagnosing
the likelihood that future financial shockswould more be practices, lack managerial of accountability, and eventual The act not solve did the perennial 123). demise problem (p. theof balance payments, of furthermore but “increased it with the existent usury restrictions, affecting the institu tional banking of evolution and severely contributing the to Bank’sAyr formation, massive size, risky insider-lending was a general confusionin regards the to true sources of Scotland’s complicated troubles. the complexity the in of a context problem multifaceted of bankingregulation—ill directed.They led a to superficial interpretation and misdiagnosis the since of there problem an effort that, from their perspectives, was complicatedby unrestricted entry smaller of banks and notes issuers” (p. Nevertheless,137). those impulses were—due reform to for knowledges that the act was partly a genuine attempt of Scotland’s largest banks “to impose a highly on order dif ficult and poorly understood macroeconomicsituation, regulatory capture behalf on Scotland’s of biggest banks, “and ought caution therefore to us against too a simple conception regulatory of Goodspeed capture” 23). ac (p. knowledges that the reforms and the regulatory changes simply and not were and in for implemented 1765 lobbied entirely anticompetitive an of outcome seeking rent or conditioned outcome of fragile, of conditioned outcome (yet inefficient, overly and regulatedinadequately) banking systems. nomic recoveriesnomic are inherent, not of unavoidable outcomes any banking systems failing inherent or maladies capi of talistic economies. They rather seemto be an institutionally shareholders and bank managers, and the rules banking of liabilitymatter considerably in determining the severity of and recovery from banking crisis. Painful and eco slow need impose to a severe, long, and recoveryslow whenever a banking crisis occur. Institutional context, incentives for the unavoidable “inherentdrag” imposed recoveries on by banking crises be to have Scottish experience suggests that all not banking systems to financialto intermediation(Reinhart Rogoff and 2009). if take we Goodspeed’s However, insights the seriously, con drawnclusions Reinhart by (2009) regards andin Rogoff to affecting to acknowledge we have recovery, the sig a that nificant part of the explanation comes from substantialthe damage that the banking system did credit to marketsand and understanding the and recovery slow long sufferedby the States. United Whereas there might be other factors VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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a framework of institutional analysis that incorporates all NOTES three concepts in order to analyze systemic risk and the macrostability properties inherent in different banking sys- 1 Indeed, of the sixteen banks that failed in 1772, only tems. three failed to pay their creditors in full. However, their Evidence suggests that free-banking regimes possess biggest creditor was actually the Ayr Bank, meaning a great degree of antifragility. In contrast to Goodspeed’s that the losses were ultimately borne by the sharehold- historical case, contemporary societies have followed an ers of the Ayr (ibid., 98). The other thirteen banks, in alternative approach that, in fact, has driven us ever fur- fact, transparently and in an orderly manner settled ther away from antifragility into severe and ever-growing their debts in full, with stable expectations and con- systemic fragility. Now that we are reflecting on the Great fidence in the security and wealth of their proprietors Recession, and looking for ways to fix our banking mala- to render them able to pay and be liable for more than dies, perhaps we should take a closer look at what banking enough to cover the liabilities. history might tell us concerning the dangers of legislative 2 I am grateful to Harry David for editing assistance. reforms, complexity, and the alternative, robust institution- al structures that we should consider more seriously.2 REFERENCES
Goodspeed, T. B. 2016. Legislating Instability: Adam Smith, Free Banking, and the Financial Crisis of 1772. Cambridge, MA: Harvard University Press. Paniagua, P. 2017. The Institutional Rationale of Central Banking Reconsidered. Constitutional Political Economy, Vol. 28, Issue 3, 85 pp. 231-256. Reinhart, C. and Rogoff, K. 2009.This Time Is Different: Eight Centuries of Financial Folly. Princeton: Princeton University Press. COSMOS + TAXIS + TAXIS COSMOS
REVIEW Legislating Instability: Adam Smith, Free Banking, and the Financial Crisis of 1772 by Tyler Beck Goodspeed ------Rivalry and Central decision makers must always face. real by Don Lavoie by Lavoie’s book was originallyLavoie’s published as in part 1985 of the socialist-calculation debate, well is more known today in economics. That book could be considered an exercise in the history economic thought, of the history market of so cialism, and comparative analysis. the of Most arguments contained in that book and reiterate appraise the original argumentsgiven both by the sides of it debate. Therefore, was a vital retrospective and revisionist contribution about the history and unfolding the of debate and its arguments. Therefore, Therefore, they engagingare in an illegitimate and incom scientific form of plete and institutional political analysis. In assuming the issues aforementioned while away evalu ating proposing or public policy and institutional solutions in beto implemented real life—and thus grounding their analysis ideal on theory and idealistic assumptions hu of man nature—social scientists are precariously proposing idealistic, unfeasible vital to solutions and pressing social issues.such well-intended public policy Unfortunately, pro posals (based questionable on assumptions human about nature, incentives and will knowledge) always reveal them selves inherently fragile and susceptible failure to when ever confronted with real conditions politics of and human ignorance, including limited knowledge and misaligned isincentives in It reminding (Paniagua us never to 2016). theseforget enduring, pressing issues and incorporate to them explicitly into our analysis governments, of public policy and institutions book will that Lavoie’s always main tain its relevance. a two-book sequence. His other book, Planning: The Socialist Calculation Debate Reconsidered which review provided a novel and account of 2015), ([1985] andimplications incentives, of conflicts of interest, and personal knowledge. in But so doing, they are overcom not ing solving or these in deci (inherent inexorable problems sionmaking), which They are instead ignoring or assuming these issuesaway. ------([1985] 2016),
INTRODUCTION INTRODUCTION The The book critically suggests that social scientists can The reason The why this book willretain its relevance re
Social scientists keep may discussing includ public policy, ing the efficiencyand wider functionsgovernments of and other institutions, without fully acknowledging the role soundness rules of and governments’ decision-making— and theirpossible limitations and propensityfail—if to they neglect the incentives of role and contextual knowledge. always remain relevant. fully not understandpublic policy’s effectiveness and the sound and wealth-enhancing policies. Since incentives and knowledge will alwaysbe crucial and pervasive in shaping human decision-making and capabilities, this book should shaped alternative by rules informal) or (formal and the in stitutional framework, and ultimatelyincentives how and knowledge directlyaffect individuals’ capabilities enactto centives, power, and, critically,centives, more power, contextual knowledge in affecting allforms of decision-making governance and structures. In addition, examines it these how are elements and enrich to our understanding existent of institutions. sides in its explicit treatment the of in of inexorable role of institutions,of and political in economy general. This book onlyis not relevant also but foundational future for research politicalon and economy comparative institutional analysis retainedits academic of much freshness and readability, but his ideas preserved increased) have not (if their relevance contemporaryfor discussions the public policy, on design perhaps no longer relevant. longer perhaps no Nevertheless, Lavoie’s Don National EconomicPlanning: What Is Left? recently republished the by has only Mercatus not Center, ly published could One in think 1985. this review arrived thirty years late, and is it engaging hence in an exercise of history economic thought of ideas old reconsider some to 1. mightIt seem odd today review to a book that was original Web: https://www.pablopaniaguaprieto.com Web: $19.95 322 pages. 2016, University, Mason George at Center Mercatus National Economic Planning: PANIAGUA PABLO What Is Left? REVIEW VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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Lavoie’s National Economic Planning: What Is Left?([1985] assumptions concerning human knowledge. Lavoie ([1985] 2016) can be interpreted as a complement to the previous 2016) applies a similar analytical framework not only to book, but in a way that looks forward rather than back on comprehensive planning, but also to modern top-down the arguments about knowledge and planning. This book contemporary forms of noncomprehensive (selective) plan- builds upon the historical insights and arguments exposed ning. As the subtitle of the book suggests, part of its scope on his previous book and enriches them with modern ideas is to analyze what is currently left in the theory of national concerning the philosophy of science, epistemology, and on- economic planning as a method of economic organization tology. The outcome is a novel framework that incorporates once it has been proven a failure as a comprehensive (to- past insights but enriches them with a multidisciplinary tal) approach. Next, it scrutinizes what is left of that theory literature that makes the arguments more compelling than and its implications for the current crisis of identity and of before and connects them to more explicit scientific foun- viewpoints in the intellectual left. dations based in the philosophy of science. Finally, by suc- The book is both a theoretical development and refine- cessfully applying this framework to evaluate and assess ment of the critiques of planning, and also a practical as- different public policy ideas and notions of contemporary sessment of actual planning proposals along with evaluating economic planning, Lavoie also provided the foundations contemporary planning alternatives. Lavoie sets the stage for further applications in comparative institutional analy- in chapters 1 and 2 by examining the inevitable “economic sis. Whereas his other book helped rescue crucial past ideas problem,” or how we must deal with socioeconomic coordi- in political economy previously overlooked by modern eco- nation and scarcity. Building from Hayek, he describes eco- nomics, the book under review instead provides a novel nomic and plan coordination as the main social problem all vision (and a tentative framework) for building a new mul- institutional arrangements must pay attention to in order to tidisciplinary and scientifically broad political economy. deal successfully with scarcity and economic survival (pp. 87 Overall both books appeared as a serious challenge to the 26–28). In so doing, Lavoie analyzes in depth the concept widely held view of the apparent success of market social- and positive role of “social intelligence” and the crucial role ists in reconciling planning and markets. They also made of social-relational dynamic processes in forming a better economists more deeply aware of the technical, epistemo- and “higher order” type of social relational intelligence. logical and scientific unfeasibility of socialism and central Subsequently he explores how the economic problem and COSMOS + TAXIS + TAXIS COSMOS planning of the economy. social intelligence relate with each other and are dealt with The next section outlines the book and calls attention to by three alternative forms of social organization—tradi- some crucial insights of Lavoie’s peppered throughout it. tion, markets, and planning—and how these forms of orga- Section 3 indicates some of the recent explorations and far- nization can actually deal with scarcity and coordination. reaching applications of Lavoie’s framework for compara- Lavoie argues that tradition, albeit a primitive form of coor- tive institutional analysis and his substantial contribution dination, is able to use informal rules and taboos to success- to robust political economy (Pennington 2011). Section 4 fully coordinate and organize simple and small societies. concludes by considering the work of Lavoie’s as providing Markets instead allow for extending the complexity and a radical vision for a multidisciplinary research agenda. dynamism of coordination to new realms of social activities and interactions, deepening and extending collaboration, 2. THE BOOK ITSELF the division of labor and knowledge and increasing well- being. Planning, however, according to Lavoie, attempts to Lavoie’s book was intended to challenge the new conviction replace tradition and markets with a more comprehensive that piecemeal or “noncomprehensive” planning is a much and “rational” social order. It attempts to consciously and more feasible and perhaps even better alternative to com- explicitly apply reason and science to coordinate and estab- prehensive and large-scale national economic planning.1 In lish a path for future developments and to control the des- Lavoie ([1985] 2015), he shows how comprehensive econom- tiny of society, all grounded in a single, overarching design. ic planning fails severely to achieve market coordination Lavoie also argues that planning suffers more critically and a rational economic order. He provides a powerful case than markets and tradition from two severe problems. The for why comprehensive planning is economically irrational first problem is the “power problem” generated by planning, since it is based on unattainable and inaccurate philosophi- in which there is a dangerous and excessive concentra- cal and economic foundations and on idealistic and static tion of control and economic and decisional power in the
REVIEW National Economic Planning: What Is Left? by Don Lavoie ------Whereas contemporary proposals planning for fo have Contemporary planners and market socialists have who that the competitive market is itself the primary source knowledge of which about goods are be to pro duced and which production methods are feasible … the social function performed a particular by complex legalof and market institutions makes them indis pensable the tools certain for of solution unavoidable 4) (p. economic problems. comparative institutional analysis, and politics. cused retaining on democratic values, incentives, “good people” in “the right place” and better computational-in formation processes, they regrettably have remained silent the about rules, of role institutions,and decentralized so cial interactions in forming knowledge itself—knowledge that planning theories simply assume exist to as available sought guide to and design partially the have economy recognized and the the problem power control-political dangers individuals face in relinquishing and power gover nance a centralized to they largely have However, agency. theoverlooked epistemic and ontological implications they will face in establishing central planning decentralized over decision-making processes and market institutions. Thus they disregarded have the severe limitations—and even impossibility—theywill facein producing and acquiring relevant procedural economic knowledge. This is problem actually institutionally inexorable and particularly acute whenever they attempt replace, to undermine, govern or some market-institutional relational aspects foundational economic knowledgefor and coordination in emerge to thefirst place. both Consequently, market institutions and social relations perform unique epistemic and complexity- ontological functions thatare vital deal to with scarcity and ameliorate to the whileeconomic problem improving plans’ institutional social-procedur and novel This coordination. al argument concerning economic knowledge how and col lective intelligence are socially generated is crucial still but almost entirely unaddressed the by literature planning, on chapter also suggests that the market’s competitive process itself, in addition theto local interactions between indi viduals under market institutions through (mediated the is the actualuse money), of foundation and unique context in which and intricatemore novel “highermarket order” knowledge emerges and gets communicated. In Lavoie’s words, what central planners failed have notice, to and their critical is epistemicoverlookingin flaw, ------
2 complex emergent phenomena phenomena emergent complex and social combinations orderly of relations socially-conditioned types
Chapter 3 “contains the central argument the of book” (p.
cial ontology (Lewis and Lewin The Paniagua 2015; 2018). tutional contextand the use(Paniagua relate to money of This chapter sheds lighton the indivisible2018). relation ship between institutional analysis, and epistemology, so unique ontological market properties relevant coordina for tion all. form at to These crucial ontological emergent and social properties will arise not without the market insti market institutions. This critical suggestspoint only that specific and institutions can allow economic knowledge and the mined with a static fully explicit plan. they Rather, are spe cial and stemming from specific market-based socialrelations and 65–81). Ultimately, argues he that 65–81). economic rationality and the efficiency ofthe ordernot market are social elements that can be fully defined designedand predeterex or ante tacit aspects economic knowledge of and critically more theon contextual and institutionally aspects dependent of the growth and such crucial of emergence knowledge (pp. Polanyi’s sociology of scientific knowledge (Polanyi 1951), Polanyi’s sociology scientific of (Polanyi1951), knowledge redefinesLavoie broadens and He the problem. knowledge emphasis the on puts more individual, socio-relational and instead as redefining enlargingand the arguments they raised.By borrowing from the growth-of-knowledge litera ture, the sociobiology, modern philosophy science, of and problem.” Lavoie’s restatement of the restatement of knowledge problem Lavoie’s problem.” thandoesmore and ideas Hayek’s simply reiterate Mises’s concerning economic planning, and could it be considered borrowed fromborrowed themodern fieldsof biology and scientific discoveries. is also he where Here in depth lays out more and clarity than ever what considers the he “knowledge thor a thorough lays out description the of market process and fruitful develops analogies with it of interesting exam “organizationalof ples social patterns” and social processes 5); hence I will hence 5); particular put the emphasis it. Here on au well-being (pp. 20–21). The The second difficulty,which accord 20–21). well-being(pp. ing is Lavoie to the most fundamental is one, the “knowl which reviews he edge problem,” in depth in chapter 3. freedom association. of Furthermore, this top-down con trol society of can lead severe to unchecked abuses power, of severelyhampering human dignity, morality, liberty, and tutional shift has deeprepercussions for social control, the balance and power governance of in society, undermining individual choice, previously establishedinteractions, and hands a planning of planningideaof The whole authority. is radically to replace the decentralized decision-making process the of market with a centralized This entity. insti VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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data and thus as both already produced and already codi- I consider Lavoie’s reframing of the epistemic problem fied (and therefore of easy access). In so doing, they errone- along the lines of sociobiology, complexity and Polanyi’s ously treat market knowledge not only as ‘already there’, but sociology of knowledge a very important contribution, one also as ontologically reducible to the pre-existent epistemic that cannot be said to simply restate anterior arguments resources held by agents in isolation (regardless of their so- (pp. 65–85). Furthermore, it invites us to think deeply about cial relations); rather than focusing on how individuals, by the ontological properties of economic knowledge and mar- being actually social-relationally organized through money kets and the role of rules and social relations by which such in specific market contexts, produce a type of complex in- emergent coordinative properties can arise (Paniagua 2018). tricate knowledge arrangements that did not previously ex- The indivisible relationship between the existence and ist (pp. 65-76; Paniagua 2018). Hence planning proposals growth of economic knowledge and the institutional con- commit the fatal error of assuming that the emergent epis- text for the rules and social-relational procedures that temic and ontological properties crucial to impart rational- constitute it has been ignored in the social sciences. Hence ity and coordinate markets can be disassociated from, and Lavoie suggests that “when we study a social system, we can exist anterior or outside of, the actual social processes have to focus on the method of mutual coordination among and institutions that allow them to exist. Social scientists the individuals” (p. 28). Overall these first three chapters have thus disregarded the contextual complexity of social can be read independently of the following ones since they orders, the ontological category of emergence, and their im- provide the core theoretical background by which to evalu- plications for knowledge in market institutions (Lewis and ate any form of public policy, planning or government at- Lewin 2015; Paniagua 2018).3 Regarding market knowledge, tempt to control aspects of the economy. Moreover, these there is a complexity and an ontological aspect of its emer- chapters can be read as a key contribution to an emergent- gence, suggesting that the “overall intellectual capacity of social-order perspective on knowledge. 89 several interacting intelligences may be quite different from After providing the theoretical framework in chapters that of its constituent parts … [W]hether the whole would 1, 2, and 3 that explains in depth the power problem and be greater or less than the sum of its parts … depends … the knowledge problem, Lavoie systematically proceeds to crucially on the method of interaction among them” (p. 27, scrutinize different contemporary practical forms of non- emphasis added). comprehensive planning; such as the macroeconomic ag- COSMOS + TAXIS + TAXIS COSMOS As suggested Lavoie’s critical insight is that economic gregative planning represented by Leontief’s input-output knowledge is not only dispersed, local, and hard to ar- method (chapter 4), broad economic democracy, which ticulate (tacit). More importantly, it is a conditional and seeks to extend democratic inclusion and participation in contextual-emergent property of the unique combination private economic decision-making (chapter 5), and selec- of decentralized interactions and the use of money in com- tive reindustrialization policies known as “structuralist” petitive social relations. Following Polanyi (1951), he sheds strategies, which seek to modernize and revitalize particu- light on the complexity aspects of knowledge as a social lar relevant or “structural” sectors of the economy (chapter phenomenon and the epistemic emergent ontological prop- 6). Here Lavoie goes beyond the theoretical arguments and erties that competitive social relations in markets generate. focuses on a practical analysis of what occurs when non- A vast extension of economic knowledge therefore appears comprehensive forms of planning are actually established, to be an ex post indivisible complex outcome of a system as well the implications. Taken together, these three chap- of social relations sustained by money and competition (pp. ters are excellent examples of how in practice the power and 76-86; see also Paniagua 2016; 2017). In the words of Lavoie: knowledge problems can be applied to provide an institu- “The spontaneous order that emerges on the social level is tional-epistemic analysis of governance’s alternatives and the outcome of the rivalrous competition among individu- assessment of real public policy and their limitations. Thus als. It is a higher-level order that evolves out of a furious they allow readers not only to understand the severe limita- turmoil of lower-level disorder” (p. 69).4 Replacing or alter- tions of contemporary proposals, but to get a notion of how ing the exclusive interactions and social processes of the to apply the theory to actual institutions and governments’ market will deprive the social order of the framework and policies in order to analyze their merits and limitations re- context in which new and wealth-enhancing “higher order” garding authority, knowledge, and incentives. ontological and epistemic properties can emerge. What all these three proposals have in common, and the reason why they fail to achieve their rational economic
REVIEW National Economic Planning: What Is Left? by Don Lavoie ------
EXTENDING LAVOIE’S WORK: WORK: LAVOIE’S EXTENDING ECONOMY POLITICAL ROBUST Lavoie’s work suggests work should we concentrate real on Lavoie’s con analysis—a inquiry form of that responds Buchanan’s to abandon to plea romanticized visions politics of and insti tutions. is it an Hence open invitation a research to agenda comparativefor institutional analysis ‘without romance’. must analyze We alternative arrangements and see how theyactually deal with human imperfection and whether in practicethey beneficial produce or detrimental outcomes. must thinkWe seriously more the about effects long-run of alternative institutional arrangements are in fact feasible and perhaps better than existent ones. The larger contri this of bution book is lead to us think critically the about properties and robustness our of existent social organiza tions and institutions and see if there are relatively superior alternatives that can we toward. move His insights can be fruitfully extended compare to and evaluate institutions in understand to order their economicand social impli cations. In dare other “must words, we imagine to radical alternatives the to kinds social of institutions which to we become sohave accustomed, and explain to these why new institutions qualitatively would work better than the pres the Given pressing socioeconomic difficul 16). (p. ones” ent ties face, we need seriously we to question and evaluate how our existent institutions actually operate and see to whether theyenhance human well-being.Ultimately societies bene fit continuouslyfrom and thoughtfully experimenting with institutions find to radical alternatives existentor improve systems when they are lacking. found ditions and abandon the idealistic assumptions concerning politics, incentives, and knowledge that very often have plagued our theoretical analysis. In other asks words, it us abandonto ideal theory real for comparative institutional epistemology, public policy, and public policy, epistemology, economics. does Lavoie this his defend to arguments tacit on knowl and emergent edge against the claim that they rest scientific not on do foundations. By doing actually so, he that shows the current disavowal and demise positivism of and objectivism within the philosophy science of indicates that economic planning is essentially unscientific built and upon an erroneous posi tivistic conceptionscientific of discoveries and knowledge 261–64; see also(pp. Polanyi 1951). 3. today for political work relevance The of econo Lavoie’s mists only is not in clarifying the insurmountable epistemic withproblems central planning, in but thinking what about ------
Finally,the appendix provides an invaluable account of Chapter 7 addresses the ideological and practical chal
the modern philosophy science of and its implications for and the left’s practical and the left’s experiences withplanning, along the suggestingway they where astray. went militarized the and economy oppressed individuals. The chapter also provides a historical overview the of intellec tualthe of left, development militaristic of society, control factualperhaps lethala abyss (and contradiction) between the laudable goals the of radical left and real the outcomes centralof planning has it supported. Planninghas further the power problem thatthe problem the power ends the radical left soughtto pursueare paradoxically undermined and systematically violated national by planning. There is an historical and vere mistakevere in embracing both and non comprehensive planningcomprehensive as means a rational to social order. The chapter demonstrates withits historical analysisof lenges thelenges modern left faces given the failuresplanningof previously exposed. argues Lavoie that the left made a se sight be to highly skeptical all of sorts public policy of and institutionsgovernment that seek guide to and plan com socialplex orders. planning fail. to Recognizing this inherent relationship and unavoidable trade-off undermines all argumentsnon for economic planningcomprehensive and provide the key in and the loss both of context-specific knowledge com and ontologicalplex properties, the on other hand that lies at the the of core fragility planning of and inexorably leads ultimately this crucial unavoidable structural relationship andtrade-off between of replacement institutionalthe mar ket arrangements and socialinteractions, the on hand, one command, they simultaneously become unable gener to knowledgeate and social intelligence required make to ac curate decisions and impartto economic rationality. is It nomic choices.nomic By replacing decentralize interactions and decision-makingin the market democratic for political or both and critically the more problem power the to knowl preventingedge them problem, from generating and using the contextual knowledge required make to rational eco top-down group systems or that override dominate or indi viduals’ local knowledge, their relations, and their decision- making powers. Therefore, they are extremely vulnerableto group. Moreover, they seek replace to individual Moreover, group. sovereign social ty, relations, and local knowledge with centralized or group command and data aggregation. They forms of are goals, isthat all them of are variants economic planning, of whichseeks institutionally to centralize control, decision- making powers, and governance in the hands a or a few of VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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those institutional arrangements when individuals are not nancial regulation. It would also be of interest to apply the perfect. RPE framework to new theories that frame governments’ The radical agenda Lavoie gave social scientists is to con- economic involvement as an efficient and dynamic way of stantly think critically about how all real-life institutional generating “entrepreneurial innovation.” Such explorations arrangements need to manage and ameliorate both the will help scholars engage more productively in contempo- knowledge and the incentive-power problems—inexorable rary debates in public policy about “government entrepre- problems that decision makers will always face regardless neurship” and state-led innovation. of the institutional arrangement. The book could be seen as providing a way to extend and apply these crucial insights 4. CONCLUSIONS FOR A RADICAL to a variety of proposals and institutions that have not pre- RESEARCH AGENDA viously been analyzed critically through a framework that takes into account Lavoie’s considerations seriously. It pro- Lavoie’s work shows that planning faces severe, insur- vides fertile ground for open-ended and interesting appli- mountable problems concerning power, incentives, control, cations of the power and knowledge problems for scholars and knowledge. Both models of economic planning (com- working in comparative institutional analysis and public prehensive and noncomprehensive) are unable to solve in policy. There is a wide range of contemporary social prob- a rational and efficient manner the basic economic prob- lems and original public policy proposals that aim for non- lem of how to coordinate activities. Despite showing that comprehensive planning solutions but might be amenable economic planning is unfeasible and even contradictory to critical scrutiny under Lavoie’s framework. to our values of freedom, dignity, and abolishing political In fact, Lavoie’s framework has already been applied oppression, Lavoie does not reject planning in favor of the in political economy under the name of robust political status quo. In fact, he proposes a “more scientifically sound 91 economy (RPE). Thus the book has already contributed radicalism” (p. 1). The only viable solution to these insur- to an open-ended ongoing research program. Robust po- mountable problems, Lavoie suggests, resides in radically litical economy means the analysis of comparative ro- decentralizing governance and decision-making, allowing bustness of institutions and political-economic systems, individuals at the local level the liberty to use their personal or their actual ability to produce welfare-enhancing out- knowledge and resources as they see fit. By doing so, they COSMOS + TAXIS + TAXIS COSMOS comes despite severe deviations from ideal conditions and can rely on voluntary cooperation, relations and market problems concerning individuals’ incentives, motivations, institutions to generate the crucial conditions required for and knowledge (Pennington 2011). Thus it relaxes the as- forming and communicating relevant knowledge. His radi- sumptions of complete knowledge, perfect rationality, and cal proposal resides in a complete and emphatic rejection of benevolence and asks whether institutions can still accom- planning and an embracement of decentralization, freedom plish their objectives in the face of those defects in human of association and markets as the mechanisms of social or- nature. RPE seeks to address both the knowledge problem ganization and well-being. as laid out by Lavoie and the political, power, and incen- Facing the crippling epistemic limitations of planning tives problem as further elaborated in the public-choice ap- for attaining the left’s long-desired goals, Lavoie suggests proach of Buchanan and Tullock in order to evaluate how a radical, scientifically rigorous, market-based, and de- resilient alternative arrangements are. Taken together the centralized solution to our social problems. His proposal two approaches provide a strong—less idealistic and more challenges modern radicals to scrutinize further their conscientious—foundation for analyzing public policy and own preferred institutional proposals, given the inexorable comparing institutions. trade-off between planning and knowledge explored in sec- There have been interesting applications of the Lavoie- tion 2. Economic planning is epistemologically unworkable RPE approach in different subjects, expanding our under- and furthermore leads inevitably to strong control and to standing about the comparative robustness of alternative a reactionary, militaristic type of policy-making that goes institutions in areas such as monetary policy and banking against the very same goals and values the radical left seeks (Paniagua 2016; 2017), among others (see also Pennington to pursue. Therefore, such forms of organization and plan- 2011). It would be interesting to see scholars apply the ning must be abandoned by both the radical left and by Lavoie-RPE framework to institutional proposals in other conservatives. fields such as economic development, immigration, and -fi
REVIEW National Economic Planning: What Is Left? by Don Lavoie ------veyed accurately through language, questionnaires, or Third, statisticssome needs knowledge (Polanyi 1951). beto sociallygenerated and discovered under specific institutional contexts. knowledge Hence isalso con textual and procedural. emerges prop as a complex It erty a competitive of system social of relations which produces a type knowledge of nonexistent anterior to those of outside or rivalrous social processes that spe such cifically“higherMoreover, 6). constitute(p. it knowledgeorder” possesses ontologically and qualita tively distinct properties irreducible the to fragmented knowledge the by held agents anterior of outside or to specific market relations (PaniaguaAll three 2018). aspectsand the of knowledge complement problem reinforce making each other, an epistemological and ontological case against central planning stron much thanger previously recognized. communication a certain of kind practicalof knowl edgethat andis also bothhard (tacit) whose convey to existencemere is conditioned a set by institutions of and social relations. Readers interested and so in phenomena complex cial ontology should see Lewis andLewin (2015). Particularly also and phe related money to complex seenomena Paniagua (2018). This insightdoes not invalidate or exclude other the aspects the of knowledge In fact, problem. Lavoie throughout the book uses all the different aspectsof tractability,it.For the knowledge comprises problem threeaspects: First, knowledge is fragmented and sub jectiveand thuspossesses deep local and individual properties. Second, key some knowledge isactually tac andit skill embedded and therefore unable be to con 3 4 ------about gathering about not
lack the knowledge combine resources to in a manner thatis economic enoughsustain to modern technol adds Lavoie emphasis the on factogy” that 52). the (p. obtaining of problem knowledge is information and data, social about but access and to government control.government Instead, plan noncomprehensive ning means all variants partial of ar some over control eas the while of economy still retaining market some institutions. “The is problem knowledge the contention a that cen tral planning board, even if well intentioned, would Planningdefined is here “only as those policymeasures that concentrating involve shape to the power economy in a special Comprehensive agency” 2). government (p. planning is the abolition complete private of owner prices, ship, and and money the substitutioncomplete marketof institutions and their social processes with Lavoie’s radical Lavoie’s vision society of should still be relevant
2 NOTES 1 ous, multidisciplinary but political in economy particular. servesas relevanta and vital part the of current extended academic dialogue that is essential the for advancement of social sciences in general and an for unromanticized, rigor to understand to the relativerobustness fragilityor difof institutionalferent our to solutions pressing social issues. Henceforth this book does simply clarify not past ideas, but and relevant decision makers in particular. Finally, Lavoie’s contributions can be the foundation for novel research proj ects in comparative institutional analysis and public policy litical theory and idealistic economic policy and always to question the unwarranted epistemological and incentive assumptions scholars often makehumans about generalin institutions. enduring The significance ofthe re book to is mind us constantly to push back against romanticized po useful start to dealing explicitly more and thoroughly about knowledge and problems epistemic constrains and incor porating them in our analysis comparative of politics and of researchof based multidisciplinary on scholarship. will It scholarshelp think creatively and differently about their ownfields of expertise. framework is particularly Lavoie’s think creatively economics about and political I economy. everyrecommend to it social scientist interested in building new scientific paradigms and in avenues developingnew and appealing today everyone to concerned human about dignity and freedom association. of The book asks to us VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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REFERENCES
Lavoie, D. [1985] 2015. Rivalry and Central Planning: The Socialist Calculation Debate Reconsidered. Cambridge, MA: Cambridge University Press. Republished by the Mercatus Center, Arlington, VA. Lewis, P. and Lewin, P. 2015. Orders, Orders, Everywhere … On Hayek’s The Market and other Orders.Cosmos + Taxis, 2, no. 2: 1–7. Paniagua, P. 2016. The Robust Political Economy of Central Banking and Free Banking. Review of Austrian Economics 29, no. 1: 15–32. Paniagua, P. 2017. The Institutional Rationale of Central Banking Reconsidered. Constitutional Political Economy, Vol. 28, Issue 3, 231-256. Paniagua, P. 2018. Money and the emergence of knowledge in society. Review of Social Economy, Vol. 76, Issue 1, 95-118. Pennington, M. 2011. Robust Political Economy: Classical Liberalism and the Future of Public Policy. Northampton: Edward Elgar Publishing. Polanyi, M. 1951. The Logic of Liberty. Chicago: University of Chicago Press.
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REVIEW National Economic Planning: What Is Left? by Don Lavoie ------1 ....” (Maitland....” (12.2.2015) was a bit (12.2.2015) dominium, Jacobin (Online) thusunencumbered “capitalist by intellectual prop erty rights” (p. 232)] articleWright’s in Capitalism as organizing of a way economic activity has three critical private ownership components: of capital; the production for market the for purpose of makingdo workers who of profits; employment and ownnot the means production. of attackingThus “capitalism” is assumedattack to involve In attacking ownership “private capital” of “private or decentralized market exchanges—generates the char acteristiccompetitive drive profits for and capital ac cumulation capitalist of 22-3) pp. firms. 2010, (Wright [unless otherwise indicated, all are quotes from the 2009 June freely version available theon internet and inherited straight from Marx own whose “private of notion ershipthe of means washis of production” of one biggest blunders. Marx understood that in the feudal system, the rights the govern to living people the on land and the right the appropriate to fruits their of all labor were part and par cel the of “dominion” the of “Lord” the of land. As Frederic Maitlandwith it: blends “ownership put rulership, lordship, sovereignty in the vague medieval more concise. more ownership “private capital” of broadly more in or ing: (1) Marxism, the private property “coordination system, (2) organized through decentralized market and exchanges”, own not the do who workers of means of “employment (3) The production.” alternativeof “democratic egalitarian so cialism” would thus negate these three features. ownershipthe of behooves the it means production,” of critics least at to understand those legal notions in the “cap italist” The system concept is misnomer;a (also see below).
- - - - - by Erik Olin Wright by Envisioning Real Utopias
vices are produced determined… The of combination these features two of capitalism— class relations definedprivateby ownership prop and ertyless workers, and coordination organized through Economic coordination in capitalismis accomplished primarily through mechanisms decentralized of vol untary exchange privately by contracting parties— what isor generally called “free markets”—through which the prices and quantities the of goods and ser not produce anything; produce not they be to set have in motion human by laboring activity sort one another. of Inor capitalism, this labor is do who provided workers by own not the means production of and in to who, order acquire an income, are hired capitalist by firmsto use the means production… of In capitalism, the means production of are privately owned and the use those of means production of is controlled those by owners their or surrogates. The means production themselves, of by course, of can So let’s startSo let’s with definition“capitalism”of Wright’s as
the target his of critique. The The disagreements runvery deep—even to very the desig “thenation of system” be to changed, i.e., and “capitalism,” the system replace to it, i.e., “socialism.” THE FUNDAMENTAL MYTH OF ‘CAPITALISM’ MYTH THE FUNDAMENTAL (2010) will focus his on understanding(2010) his ‘capitalism,’ of cooperatives,conception worker of and the general issues surrounding markets, the Left, Marxism.and INTRODUCTION Thisreview of Erik Wright’s Olin Web: http://www.ellerman.org Web: $17.61 pages. 416 2010, Verso, York: New & London Envisioning Real Utopias ELLERMAN DAVID REVIEW VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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1960, p. 174) or in the words of Otto von Gierke: “Rulership is typically confused by the ambiguity of the concept and Ownership were blent” (Gierke 1958, p. 58). But then of ownership. (Knight 1956, p. 68) Marx blundered by carrying over that notion with capital replacing land in the modern era. However, Wright’s view of the “capitalist” system and even his view of worker cooperatives (!) is totally imbued It is not because he is a leader of industry that a man is with the fundamental myth. For instance, he sees the pri- a capitalist; on the contrary, he is a leader of industry vate ownership of capital as including the: because he is a capitalist. The leadership of industry is an attribute of capital, just as in feudal times the func- rights to control the use and allocation of the surplus tions of general and judge were attributes of landed generated with the use of the means of production (i.e. property. (Marx 1977 (1867), pp. 450-1) the net income generated by the use of the means of production). (Wright 2010, p. 75) Hence the title of Marx’s opus magnum and the very name of the system “capitalism.” The standard form of this The footnote on the same page includes: conceptual mistake might be called the: The right to control the surplus generated through Fundamental myth: that the legal rights to appropriate the use of means of production is very close to what the product of production and the governance rights economists refer to as “residual claimancy”—i.e. the over the production process are part and parcel of right to all of the income generated in some economic (i.e., “an attribute of”) the “ownership of the means of process that remains after all expenses are paid. (2010, production.”2 p. 75) 95
This myth is one point of total agreement between Or concerning the governance rights over workers, Marxists and many “capitalist” thinkers—which is why Wright also considers that as part of the rights of capital Marxists have for some time functioned as ‘capitalist tools’ ownership: (Ellerman 2010). However, one of the most philosophically COSMOS + TAXIS + TAXIS COSMOS astute and careful defenders of the current system, Frank At the core of the institution of private property is the Knight, pointed out that the Marxist label is a misnomer power of owners to decide how their property is to be since capital can be rented out and the legal party under- used. In the context of capitalist firms this is the basis taking a production process (Knight’s “entrepreneur”) for conferring authority on owners to direct the ac- might not actually own the capital goods or “means of pro- tions of their employees. (2010, p. 34) duction.” But the basic point is that in the misnamed “capitalist” Karl Marx, who in so many respects is more classi- economy, capital goods are just as rentable as people. If cal than the classicals themselves, had abundant his- any legal party rents the necessary capital goods (perhaps torical justification for calling, i.e., miscalling—the from different capital owners) and buys the other inputs, modern economic order “capitalism.” Ricardo and his then that party will be the residual claimant, even though followers certainly thought of the system as center- the owners of the capital goods are still just that. Hence the ing around the employment and control of labor by residual claimant rights are not part and parcel of the own- the capitalist. In theory, this is of course diametrically ership of capital goods. The residual claimancy role is a con- wrong. The entrepreneur employs and directs both la- tractual role, and one does not ‘own’ a contractual role in a bor and capital (the latter including land), and laborer market economy. and capitalist play the same passive role, over against There is a common confusion among both critics and the active one of the entrepreneur. It is true that en- defenders of market economies about what is in fact trepreneurship is not completely separable from the owned and what is determined by the pattern of market function of the capitalist, but neither is it completely contracts—by who rents what or whom. For instance, a separable from that of labor. The superficial observer conventional corporation has owners (the common stock- holders) and a corporation may own capital goods, but it is
REVIEW Envisioning Real Utopias by Erik Olin Wright ------ rental pay production
management and
of appropriation of
article, writes: Wright Jacobin in a particularin a enterprise own
own surplus labor, and they do
surplus produced by themselves within they are the owners theof means produc of
that firmsto pay hire hourThere of an labour. because the means of production and control the process, and thus exercise rightsthe disposi over tion theof that enterprise. mechanism The thesurplus canlabor thusbe designated “private collective self-appropriation.” The directproduc ers appropriate their so through a collective process of Incooperative, worker-owned a all the of assets the of firms jointly are owned by employees the themselves, alsowho the govern firm one-person-one-vote, in a democratic manner. (12.2.2015) self-manage workers’ In an essay written (1979) before self-management constitutesWorkers’ production in which the workers Strictly speaking, the hourly wage is the ment is asset no the price for durable physical asset called a because‘worker’ modernsocieties allow not do slav theery, institution which by firms actuallyown work 201) p. ers. (Begg,& Dornbusch 1997, Fischer, Marxism has both in theory and in practice national ON THE LEGAL STRUCTURE OF A WORKER OF A WORKER STRUCTURE ON THE LEGAL COOPERATIVE is soWright imbued with the fundamental myth that he evenuses try to it characterize to cooperatives. worker The in cooperativeworkers a worker self-managed or (an firm variant)older are said the have to residual and governance rights tion. instance, For in the had collapsedment in and Yugoslavia when the younger was committedWright more using to Marxist buzz-words signalto his membership in the “ideal speech community” Marxists, of (Gouldner) the put he same idea using that jar gon. izedrather than abolished the human rental system so that instead become private public employees employees of becoming in the firms owner/members such co worker as operativesthe in where work firmwho a people jointly are working themselves for renting owning or the necessary capital. Thisbrings Wright’s co worker of treatment to us operatives. ------himselfwage. a at rent 3
(Samuelson 1976, p. 52 (his 52 italics)) p. 1976, (Samuelson Or as other neoclassical economists it: put have Since slavery was abolished, human earning is power be to capitalized. law by forbidden A man even is not freesell to himself:must he Referringthe to relation as the employment ‘renting’ of This misunderstandingof ownership the of capital was For instance,For after of merger the Studebaker the and
Prize, Paul Samuelson, it: put Regardless the of language, is it the buying the of services provided an by entity as opposed buying to the entity it self. As the first American winnerof the NobelEconomics persons common is usage not is it technically but correct. In America, a car” common usage is and “rent to “hire a in but theperson” UK, rental cars are called “hire cars.” the legal contract the for hiring, employing, renting or of human beings. the ownership “private system” and the to general use of the“private” as of a swear much Left. on word The real dis tinctive featurethe of currentprivate enterprise system is no smallno mistake in Marx. determined It the focus whole of his theoretical(e.g., efforts namethe of his topic main and and lead the to it work) disastrous call the for abolition of behard both for critics and supporters markets of under to stand. poration “owned the factory,” but Chryslerbut poration the “owned factory,” did “own” not thegoing-concern business usingthose “means produc of These simple pointsof tion.” conceptual clarity shouldnot mon phrasemon the of “ownership firm” is fundamentally con fused. The Chrysler“owned shareholders the firm” inthe sense the of owning the Chrysler corporation, and the cor bodies in its factory the to due market contract leasing the factorythe to Studebaker-Packard Corporation. The com (Wikipedia). During that lease arrangement, Chrysler the“owned factory”, was it but neither the residual claimant thenor manager the producing of Packard employees car Packard companies in the theStudebaker- early 1950’s, Packard Corporation years a few for Packard produced car bodies in a plant leased from the Chrysler Corporation Thisholds when even owner of the the capital is a corpora tion and the capital good factory. is a whole the pattern market of contracts that determines is who the ‘firm’ in the senseof going-concern the business using that capital. And market contractual-patterns are‘owned’. not VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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control over the production process. But this collec- tasks of social control. Since in general workers would tive process remains essentially private in that the work harder with less monitoring when they own the means of production are fully alienable and thus means of production, the heavy social control appara- the surplus is appropriated by the workers in indi- tus of capitalist production is a source of inefficiency. vidual enterprises rather than by the working class (2010, p. 41) as a whole. The mechanism of appropriation thus contains within itself both capitalist and commu- It is not difficult to conceptually separate being the re- nist elements: it is communist in that it is collec- sidual claimant in a firm such as a worker cooperative from tive selfappropriation rather than exploitation; it is being the owner of the means of production. For instance, a capitalist in that it is private rather than social. (1994, family farm (as a one family worker cooperative) or an ag- p. 142) ricultural worker cooperative may well lease the land they work on, e.g., from a neighbor who can no longer work the In the book under review, he expresses essentially the land or from a land trust. same idea without all the Marxist jargon. Moreover, it is important, particularly for Marxists wielding capitalist notions of the “ownership of the firm,” to A stand-alone fully worker-owned cooperative firm realize that there are other types of rights afoot than prop- in a capitalist economy is a form of social capitalism: erty rights. The other major type of right, sometimes called the egalitarian principle of one-person one-vote of all “personal” or even “human” rights, are assigned to fulfilling members of the business means that the power rela- a certain functional role—such as the voting rights attached tions within the firm are based on voluntary coopera- to residing in a democratic living community. It makes no tion and persuasion, not the relative economic power sense to treat these rights as alienable in a market transac- 97 of different people. Jointly they control through dem- tion since the buyer may not have the qualifying functional ocratic means the economic power represented by the role, and if she or he did, then they would not need to buy capital in the firm. (2010, p. 91) the rights. The litmus test to differentiate property rights from personal rights is inheritability (or bequeathability). Or: When you die, all your personal rights are extinguished but COSMOS + TAXIS + TAXIS COSMOS your property rights pass to your heirs. At the other end of the spectrum are firms character- The members of a worker cooperative do not get their ized by two principles: they are fully owned by their membership rights (net income and self-governance rights) employees and they are democratically governed by as part of the property rights such as “ownership of the their members on a one-person-one vote basis. Such means of production” or as “ownership of the firm.” Instead firms are called worker cooperatives or producer co- they are personal rights attached to the functional role of operatives. (2010, p. 167) working in the firm—just as one’s municipal voting rights are attached to the functional role of residing in the mu- As an aside, it might be noted that in the American usage, nicipality. This has been spelled out quite clearly in the “producer cooperatives” refers not to worker cooperatives literature on worker cooperatives for at least 40 years, e.g., but to agricultural marketing and processing ‘cooperatives’ the pamphlet (ICA, 1978) published by the oldest organiza- (e.g., Land O’Lakes, Ocean Spray, Sunkist, etc.) which are tion in the country devoted to worker co-ops, the Industrial completely conventional from the viewpoint of the employ- Cooperative Association (now The ICA Group). The legal ees and whose members are mostly agri-business corporate structure of a worker co-op has been spelled out repeatedly ‘producers.’ over the years, e.g., in the 1982 collection of essays called Or again the same idea: Workplace Democracy and Social Change (Ellerman 1982), or in the 1984 collection of called Worker Cooperatives in If they [the workers] were owners of the firm, for ex- America (Ellerman 1984) as well as in academic journals, ample in the form of a worker-owned co-op, then their e.g., (Ellerman 1984) or (Ellerman & Pitegoff 1982-3), and individual interests would be much more strongly in a host of other papers and books. It is not clear how any- aligned with those of the firm in which they worked, one modestly familiar with the literature on worker co-ops and fewer resources would have to be devoted to the has to fall back on the idea that the members of a worker
REVIEW Envisioning Real Utopias by Erik Olin Wright ------, not those, not might who those governed are who certain minor decisions the to in workers a delegate But socialistsBut are driven their by goal largely to elimi rights. (2010, p. 77) 77) p. rights. (2010, Aside from characterizing democratic rights (supposed) What is the alternative definitionof democracy? The usu The term “stakeholders” The term is a contrast with termthe Share owners are“shareowners”. the set with people of private property rights in the means production. of Stakeholders are all those with a “stake” in the means productionof because their lives are affected how by those means production of are used.idea The that so cial ownership specific of means productionof should extend all to stakeholders is the principle most consis withtent the normative ideals radical of democratic egalitarianism discussed in Recall chapter 1. that the democratic egalitarian principle political of justice is thatall equal should people have access theto means necessary participate to in decisions which affect their lives as individuals and as members as communities. This corresponds to the expansive of notion social ownership in which all “stakeholders” ownership have in the marketplace (don’t buy the product!) or by consumer by the or buy in product!) the marketplace (don’t protection legislation in the overall political democracy. thenate market so they disregard the usual indirect control rights exercised in the marketplace and thus extend to have “social democratic include to all power” workplaces. The capital suppliersof and other things productivea to firm, the the of buyers products, and the local are residents all not as the rights”, “ownership point is the usual socialist one that “democratic the of control means production of and distribution” potentially must involve everyone least at or allthe Thus, “stakeholders” in there can“society.” no be workplace democracy the at firm level—although “society” may firm in “democratic egalitarian The socialism”. expression “extending democratic rights the to workplace”has the usualsocialist twist mean to democracy not inthe work extendingplace but the reach social-political of democracy “democraticor social include to otherwise power” private workplaces. al non-socialist definitionof democracy is self-government and for by, of, just be affected. This usesthe rather basic distinction be tween positive-direct-decision-making within rights (e.g., an organization) and negative-indirect-decision-constrain ing in rights the The (e.g., marketplace). rightsof those who are only affected are usuallyby enforced theirnegative-in direct-decision-constraining rights such as their power veto ------they not in favor not in favor because in co- worker a principle. property rights property at the at firmlevel as co worker in a affectedinterests
ThisWright is reason is actuallythe core why one’s life as the a member of widerone’s society. The demo cratic egalitarian principle political of justice is that all equal shouldpeople have access the to needed powers maketo their choices over own lives and participate to in collective choices that affect them becauseof the society 12) in p. which they live. (2010, much asmuch possible those decisions which affect their lives. is the make to power “Freedom” one’s choices over own life; “democracy” is the participate to power in the effectiveof collective control choices that affect The The normative second principle underlying the diag nosis and critique in this book concerns individual freedom and democracy. These ideas two are linked because here they both concern thepeople of power maketo choices things about which affect their lives. This is principle: the core should people control as If Marxists trouble grasping have the having concept of
co-opraise to prices change to or the design, so they are all “stakeholders” need who in a “say” the decision. co-op produces computers or cellco-op or that produces computers phones be may used all theover country all or the over Then world. all those us ers are “affected” by the potential decisionby worker the of workplace democracy workplace of operative democratic or self-governing worker a firm. Say, been called the DEMOCRACY? In his veryWright definition of democracy,uses what has IS WRIGHT IN FAVOR OF WORKPLACE OF WORKPLACE IS WRIGHT IN FAVOR tioned in Wright’s whole discussion whole tioned in Mondragon. Wright’s of That is just those complication too for much thinking within the framing the “owns who of means production.” of op in op the internal formof capital “divisible accounts (or reserves”) (Ellerman 2007) in which pioneered the were Mondragon cooperatives unmen and completely were personal rightsattached the to working of role in a worker cooperative,then is it best into the delve to mat not whole the terof worker-members’ co-op the have residual and governance rights the“own means production.” of VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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governed by the management of the firm. They are all only (Marx 1977 (1867), Chap. VI) and Marxists have ever since potentially affected by the decisions of the firm and thus only snickered at the very mention of inalienable rights. should have effective indirect control rights through the Hence Wright does not follow up on Dahl’s promising lead market or otherwise to protect their affected interests. That and instead, at least in his earlier and more intense Marxist is the real import of the affected interests principle. phase, appealed to Marx’s labor theory of value and exploi- It might be noted that Robert Dahl also conceptualized tation (Wright 1994, p. 128) democracy in terms of the affected interest principle and Fortunately, Dahl’s use of the affected interests principle he also tended to buy the fundamental myth that control is innocent since he does not draw the usual socialist con- (and residual) rights are part of the “ownership of eco- clusion that all non-governmental firms (of any size) should nomic enterprises” (Dahl 1985, p. 62)—as noted in the re- fall under the political-social democratic governance. view (Ellerman 1985) of his book A Preface to Economic He ignores the socialist arguments when it comes to his Democracy. Wright quotes Dahl approvingly. “Sketch of an Alternative”. Instead Dahl comes out in fa- vor of straightforward workplace democracy in the form of Robert Dahl has argued, in an important book on the “worker’s cooperatives or examples of self-management or meaning of democracy, that there is no logical reason industrial democracy; but I prefer the term self-governing why rights to private ownership confer rights to dicta- enterprises.” (Dahl 1985, p. 91)4 torial power over employees. (2010, p. 34, fn. 15) A LABOR THEORY OF ‘WHAT’? After noting that Dahl is against the fundamental myth as if it were a legal fact, Wright goes on to paraphrase a very In commenting on what is in a book like Envisioning Real different argument against the real legal source of the gov- Utopias, one might also note “some dogs that didn’t bark.” 99 ernance rights over the workers, namely the human rental In addition to Marx’s misunderstanding the basic struc- or employment contract. ture of legal rights in a “capitalist” private property market economy, Marx spent most of his massive theoretical efforts Just as we have abolished slavery even in cases where in developing the inchoate “labor theory” inherited from a person might want to voluntarily enter into a con- Locke, Smith, and particularly Ricardo into a labor theory COSMOS + TAXIS + TAXIS COSMOS tract to be a slave on the grounds that people should of value and exploitation. This theory ended up being a ma- not be allowed to permanently give up their rights to jor train wreck in addition to being inherently superficial autonomy (or “self-ownership” as some philosophers even if it had been a plausible theory of value. That is, as a call it), we could prohibit people from giving up their theory of value it could at best only be a proof that wage- right to autonomy within the employment contract of labor was systematically underpaid. For instance, in Marx’s capitalist firms. People could still invest in firms, but discussion of overtime work, he said that even if the labor this would only give them rights to a stream of earn- during the normal work day was “paid for at its full value”, ings from the investment, not any rights to control there would still be unpaid labor extracted in overtime. In the activities of people within the firm. [reference to his own words: (Dahl 1985)]. (Wright 2010, p. 34, fn. 15) It will be seen later that the labour expended during An argument against a voluntary contract to give up the so-called normal day is paid below its value, so one’s “right to autonomy within the employment contract” that the overtime is simply a capitalist trick to extort is normally called an inalienable rights argument. Prior to more surplus labour. In any case, this would remain Marx, Hegel clearly spelled out the inalienable rights argu- true of overtime even if the labour-power expended ment against allowing a person to “voluntarily enter into during the normal working day were paid for at its a contract to be a slave” in the Philosophy of Right (Hegel full value. (Marx 1977 (1867), p. 357; Chap. X, sec. 3) 1967, p. Sec. 67) and that argument clearly also applied to the human rental contract—but it all sailed right by Marx. While Marx was no doubt personally against the insti- In fact, Marx went on to ridicule such arguments against tution of wage-labor per se as evidenced by his “moralistic the wage-labor contract itself by characterizing the sphere invective,”5 his theory (even assuming it was valid) was only of exchange as the “very Eden of the innate rights of man” a theory trying to show that wage-labor is not “paid for at
REVIEW Envisioning Real Utopias by Erik Olin Wright - - - - - or labor
and is independent of History Dustbin of , e.g., (Schlatter 1951), and , e.g., (Schlatter 1951), Intellectual per se Modern LTP = Modern LTP “Labor's Right“Labor's to The The Product”Whole system.” But that But system.” was the not only capitalist
But how is Marxista how But find to that alternative labor theory? The The alternative path was it to develop as the There manyare Marxists takenhave who option second ticket punched the on basis other some of theory like his toricalmaterialism, crisis theory, class analysis, just or a postmodernist the of right word-cloud What buzz-words. firstI at puzzlingfound was why to theycrossover didn’t thelabor theory property? of That theory delivers a critique of the institution of wage-labor any theory value of wage or rates. In the vernacular, Marx ‘brought a knife a gun to brought a he fight’, i.e., value the ory a property to theory fight,of course, so, lostout he even if had been it value plausible a theory. in is not MarxIt as true-blue some Marxists testified. have made the crucial decision “the develop to labor theory” as a labor theory value of and exploitation—and target to the system as “the that develop to way inchoate set ideasthe of nor only to way identify the system. naturalrights theory property of identify to “the system” as the human rental system. That wasessentially the path taken the by small band po of liticaleconomists sometimes called “Ricardian social ists” although the of they Some principals neither. were in the ThomasHodgskin school were and Pierre-Joseph Proudhon. wisely of dropping the labor theory value of and exploita tion, and thus get their to have who Marxist membership - - - of Value Karl Marx Karl of Propertyof Thomas Hodgskin ‘Ricardian Socialists’ The The LaborTheory The LaborTheory Pierre-Joseph Proudhon The ‘Labor Theory’ John Locke Adam Smith David Ricardo
cling the to labor theory value of and exploitation as the dwindling band Marxists, of or just drop altogetherit without understanding that there was another labor theory that might be valid. one’s ‘badge Red of courage’one’s signal to membership in John Locke, Adam Smith, and David Ricardo bequeathed
ginalist the But revolution. critics “the of system” tried to thedevelop labor theory as a criticism the of system. Marx human distinguished labor no would play That role. was onlyaccomplished towards the that of end century with marginal productivity theory as part the of mar whole human labor among the other factors production. of Those their saw who social as role finding ‘scientific’ a apologyfor “the system” needed find to some alternative theory where to theto 1800s an inchoate set ideas of which might be called “the labor theory” based the on special somehow status of 2. Marxists two of reactions: one have 1. the Marxian labor theory value of and exploitation was a trainwreck as theory a value of and wasin anycase superfi cial—like its bourgeois so why many brother—one wonders theory that under non-competitive conditions, wage-labor is also its at full “paid for not i.e.,paid is value”, not the at valueits marginal of productivity Since (Ellerman 2016). its full In value.” this respect, Marx can hands hold with neoclassicaleconomists their have who own equally super ficial “bourgeois” wages-are-too-damn-low exploitation Figure 1: The fork in Figure 1: “the labortheory” road VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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None of this, by the way, implies that Marx intend- something else. But Cohen was not able to find that other ed the labor theory of value as a theory of property labor theory—which, in any case, would not deliver the sine rights, a la Locke or even Proudhon. (Shaikh 1977, qua non of Marxist socialism, the “social” appropriation of p. 121) the product of industry. Hence Cohen goes on to argue that all the inputs are “socially produced” and thus appropria- Marxists might discover the alternative “labor theory” tion must take place at the “social” level. by at least reading the titles of the other labor theory books It is a shame that Cohen did not understand that the such as: direct implication of his “fairly obvious truth” is that the inputs in one enterprise are what the workers produce in a • Proudhon’s main book, What is Property? (Proudhon supplier enterprise. For instance, the drill presses used to 1970 (1840)), produce the product in one enterprise are the products pro- • Hodgskin’s book, The Natural and Artificial Right of duced not by “society” but by the people working in a drill Property Contrasted (Hodgskin 1973 (1832)), or press enterprise. And the appropriate notion of “product” • Anton Menger’s book about the core tenet of that school, that the people in an enterprise produce is the whole prod- The Right to the Whole Produce of Labour: The Origin and uct (i.e., the production vector of output-assets and input-li- Development of the Theory of Labour’s Claim to the Whole abilities) which includes not only the output-assets but also Product of Industry (Menger 1970 (1899)). the liabilities for the inputs they use up, e.g., the liabilities for using up the services of the drill presses to be satisfied That is, in the labor theory of ‘what?’, the alternative by buying or leasing the drill presses. ‘what’ is property. By the labor theory of property, the people who work in But Marxists cannot adopt the labor theory of property one enterprise should: 101 because it is the normative basis for private property (“get- ting the fruits of your labor”). Marxists are dedicated to the • jointly own the assets they produce as outputs, and “abolition of private property” (for the fallacious reasons • jointly owe the liabilities they also create by using up the outlined above concerning the fundamental myth)—as inputs. well as to the “social appropriation” of the product of in- COSMOS + TAXIS + TAXIS COSMOS dustry. In short, Marxists are inherently against the people Those liabilities would be satisfied by buying the neces- working in each enterprise privately and jointly appropri- sary inputs from the supplier firms. But that would typi- ating the positive and negative fruits of their labor. Hence cally be a market transaction—which is another reason Marxists are not going to drop the labor theory of value in why this whole train of thought is not available to someone favor of the labor theory of property. whose pre-analytical predilection is abolishing market re- An interesting case of a potential crossover Marxist is lationships. the late G. A. Cohen. Cohen was one of the founding and The non-development of the labor theory of property and leading members of the Analytical Marxism group which the condemnation of the “private property system” is per- includes Wright and seems to be his main reference group; haps the greatest gift of Marxism to the professional apol- see the Prologue in (Wright 1994). At some point, Cohen ogists for the human rental system. That is why Marxism had the brainstorm that the core critique actually had noth- now functions as a capitalist tool.6 The human rental system ing to do with value! gives the people (“employees”) working in each firm:
And it is this fairly obvious truth which, I contend, • zero percent of their negative product (the liabilities for lies at the heart of the Marxist charge of exploitation. using use the inputs), and The real basis of that charge is not that workers pro- • zero percent of the positive product (the assets produced duce value, but that they produce what has it. (Cohen as outputs). 1981, p. 219) That is, it gives them zero percent of the whole product One would think it might occur to Cohen at this point (positive + negative product). Instead of the Marxist (and that if the “fairly obvious truth” is not about value, then conventional) picture of the workers getting part of the the “labour theory” might really be the “labour theory” of product with the employer appropriating the “surplus prod-
REVIEW Envisioning Real Utopias by Erik Olin Wright
------versöhnt” [i.e., unversöhnt” [i.e., un century, one does not have to wonder what institu wonder to century, does have one not th fying ideas my this on question profited great I have fromly numbera unpublished of papers David by Ellerman, (Dahl cited .” in 1985, ... the bibliography, fn. 1) 91, p. Albert Hirschman’s O. verdict was that Marx’s “works exhibit juxtaposition a simple scientific of apparatus and moralistic invective, wholly 570). p. in: quoted resolved] (Adelman 2013, It is often It said Marxthe elaboratenot on did his vision an of ideal condemns society. when one “the But sys because = private X tem” ownership has it of X (e.g., capitalthen has market= X one or clearly relations), idealstated least at that X. does have one’s not Thislegal is a about statement rights,“so about not cial which, power” everyone knows, is typically in the hands the of employer/capital-owner. attempt The to clarify Marxian thinking about the structure legal of rights is usually met with the Foucauldian can response: be “How so you superficial worryto legal about rights? is all It just congealed pow er relations.” And Dahl footnotes a non-socialist source: “In clari doesrecognise—the association shareholders, of cred anditors directors—is incapable production of and is expectednot the by perform to law these functions. give to the to have law real association,We and to withdraw meaningless privilege from the imaginary 1944, 38) (Percy one. p. In conclusion, we might we In the conclusion, quote genuinely radi is theHere most urgent challenge political to inven tion everto offered jurist the and the statesman.The human association which in fact produces and dis tributes wealth, theassociation workmen, of manag ers, technicians and directors, an is not association recognised The association the by law. which the law 5 NOTES 1 2 3 4 book, a vague by mélange “social of associations.” In either case, from the history real-existing of Marxist socialism in the 20 tion doing would up the end actual “social”appropriation. cal proposals the of democratic classical liberal and yet Conservative was dubbed MP “Minister (who for Thought”),remarked who Eustace Lord Percy, when con sideringthe post-WWII reconstruction: ------responsible for producing those responsible for de facto
century. th As for theAs for that dogs bark didn’t in the case hand, at By being against “the private property system” and by stop there.stop ground has assuming He more no for a partowner-ship in the product thanhas theman who thesold materials, raw theor land which on the fac tory 65-6) stands. pp. (Fairchild 1916, Instead, the are treated employees as the suppliers of ing as to how much of the of ing the to much product belongs as how la to Thesequestions borer. never bother manufacturerthe his Theyor both employee. know that, in actual fact, all the of the to product belongs capitalist, and none The thelatterto laborer. has sold hashisand labor, a right the to stipulated His claims payment therefor. The laborer at no at The laborer timeowns partany of what is pass ing through his hands under or his eye. canNever he “Thisproduct,say, when finished, will be mine,and rewardsmy will successfully depend how on can I dis much There is theoreticpose it.” of discussion to the labor“right of the to product” whole and query much
appropriation by “the by appropriation working in class this as or, a whole” to thoseto are who from results) the discussion whole and critique the of cur system.rent Instead espouses Wright the collective social or of the of labor theory propertygetting of (e.g., the fruits of in juridicalyour labor or, terms, imputing the positiveand negative legal responsibility the for results production of Wright inWright this book and elsewhere in his writings studi ouslyeschews any the of “bourgeois” language concepts or directlythe based denying on (“employees”) people rented the of appropriation positive and negative fruits their of la bor. a priceless giftto apologists the for human the rental sys tem.apologists The can pose as of “the defenders privatethe propertyin fact system”—when the human rental system is eschewing the labor whole theory property of as the only legitimate basisprivate Marxism property, for has delivered liability is labor owed. That costs) (the liability and oth the er input-liabilities who is are thus paidby off employer, the the residual claimant. commodity and thus labor, as the party the whom to labor sociologist,Wright should appreciatethe accurate state the of legalment facts another by sociologist in the early 20 uct,” theuct,” legal facts are that the appropriates the employer (allproduct the whole outputs produced and all the liabili ties and the the As for none. an inputs) workers economic VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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6 For instance, when conventional economists want to Marx, Karl. 1977 [1867]. Capital (Volume I). Translated by Ben “take on the opposition,” they typically search out the Fowkes. New York: Vintage Books. Menger, Anton. 1970 [1899]. The Right to the Whole Produce of nearest Marxist to lecture on the deficiencies of the la- Labour: The Origin and Development of the Theory of Labour’s bor theory of value. A perfect example of this genre is Claim to the Whole Product of Industry. Translated by M. E. Robert Solow’s scolding of Marxist Duncan Foley in Tanner. New York: Augustus M. Kelley. (Solow 2006). Percy, Eustace. 1944. The Unknown State: 16th Riddell Memorial Lectures. London: Oxford University Press. Proudhon, Pierre-Joseph. 1970 [1840]. What Is Property?: An Inquiry into the Principle of Right and of Government. New York: Dover. REFERENCES Samuelson, Paul A. 1976. Economics 10th Ed. New York: McGraw- Hill. Adelman, Jeremy. 2013. Worldly Philosopher: The Odyssey of Albert Schlatter, Richard. 1951. Private Property: The History of an Idea. O. Hirschman. Princeton: Princeton University Press. New Brunswick: Rutgers University Press. Begg, David, Stanley Fischer, and Rudiger Dornbusch. 1997. Shaikh, Anwar. 1977. Marx’s Theory of Value and the Economics Fifth Ed. London: McGraw-Hill. ‘Transformation Problem. In: The Subtle Anatomy of Capitalism, Cohen, G. A. 1981. The Labour Theory of Value and the Concept of edited by Jesse Schwartz, 106–39. Santa Monica: Goodyear. Exploitation. In: The Value Controversy, edited by Ian Steedman Solow, Robert M. 2006. How to Understand the Economy. A Review and Paul Sweezy, 202–23. London: Verso. of Adam’s Fallacy: A Guide to Economic Theology, by Duncan K. Dahl, Robert. 1985. Preface to Economic Democracy. Berkeley: Foley. New York Review of Books, November 16. University of California Press. Wikipedia. n.d. Studebaker. Accessed February 11, 2018. https:// Ellerman, David. 1982. On the Legal Structure of Workers’ en.wikipedia.org/wiki/Studebaker. Cooperatives. In Workplace Democracy and Social Change, edited Wright, Erik Olin. 1994. Interrogating Inequality: Essays on Class by Joyce Rothschild-Whitt and Frank Lindenfeld. Boston: Porter Analysis, Socialism, and Marxism. London: Verso. Sargent Publishers. —. 12.2.2015. How to Be an Anticapitalist Today. Jacobin (Online). —. 1984. Theory of Legal Structure: Worker Cooperatives. Journal of https://www.jacobinmag.com/2015/12/erik-olin-wright-real- 103 Economic Issues XVIII (Sept.): 861–91. utopias-anticapitalism-democracy/. —. 1984. Workers’ Cooperatives: The Question of Legal Structure. In Worker Cooperatives in America, edited by Robert Jackall and Henry Levin, 257–74. Berkeley: University of California Press. —. 1985. Review of Robert Dahl’s A Preface to Economic Democracy. Commonweal 112 (18): 584–86. COSMOS + TAXIS + TAXIS COSMOS —. 1993. Property & Contract in Economics: The Case for Economic Democracy. Cambridge, MA: Blackwell. —. 2007. On the Role of Capital in ‘Capitalist’ and in Labor-Managed Firms. Review of Radical Political Economics 39 (1): 5–26. —. 2010. Marxism as a Capitalist Tool. Journal of Socio-Economics 39 (6): 696–700. —. 2016. The Labour Theory of Property and Marginal Productivity Theory.Economic Thought 5 (1): 19–36. —, and Peter Pitegoff. 1982-3. The Democratic Corporation: The New Worker Cooperative Statute in Massachusetts. Review of Law and Social Change XI: 441–72. Fairchild, Henry Pratt. 1916. Outline of Applied Sociology. New York: Macmillan. Gierke, Otto von. 1958. Political Theories of the Middle Age. Translated by F. W. Maitland. Boston: Beacon Press. Hegel, Georg W. F. 1967. Hegel’s Philosophy of Right. Translated by T. M. Knox. New York: Oxford University Press. Hodgskin, Thomas. 1973 [1832].The Natural and Artificial Right of Property Contrasted. Clifton: Augustus M. Kelley. ICA. 1978. What Is a Worker Cooperative? Cambridge, MA: Industrial Cooperative Association. Knight, Frank. 1956. On the History and Method of Economics. Chicago: Phoenix Books. Maitland, Frederic W. 1960. Frederic William Maitland: Historian. Translated by R. L. Schuyler. Berkeley: University of California Press.
REVIEW Envisioning Real Utopias by Erik Olin Wright ------
by Francesco Di Iorio Francesco by Di Iorio’s originalityDi Iorio’s lies in his linking theory Hayek’s The The historymethodologicalof individualism is the history the of attempt eradicate to the concept of hiddendetermination fromthe studysociety, of and make thehuman being the starting social point of analysis. Methodological individualism rests the on understanding that the social is the order uninten tional human many product of actions. autonomous Onthis reading, the conflict between sociologicalho lism and methodological individualism be may inter preted as a conflict between a theoryheteronomy of 3). and a theory (p. autonomy of Di Iorio explainsDi Iorio that methodological individualism, as of human autonomy and human methodologicalof autonomy individualism to cognitive science, specificallyto enactivism, via Hayek’s theory the of sensory that order considers the human mind beto a self-organizing system. complex The book goodis a example interdisciplinary of dialogue between cognitive science and usually sociology, treated independently. understood posits Hayek, by that social can phenomena be regardednot as predetermined; they must be explained in terms The a spontaneous of inherent complexity order. socialof the of is one main phenomena reasons Hayek why criticizes social planning and political constructivism. The interesting thesis thing is that Di about highlights Iorio’s it the dialectic between human actions and their uninten tional consequences, focusing conceives of Hayek how on action. According a detailed Di to Iorio study Hayek’s of theory action of has often beenneglected in the scholarly literature: causethe consequencesindividual of actions areoften un intentional and unpredictable. ------paradigm. The latter con Verstehen Cognitive Autonomy and Methodologi Autonomy Cognitive is a revised his of version doctoral thesis
The The book discusses two fundamental assumptions con Accordingmethodological Di to Iorio, individualism has
given environment and freedom. be considered to of devoid The second assumption is that social cannotphenomena be understood only as the planned results human of action be found infound the external environment, in but the individual. Accordingly, this assumption, challenges various holistic paradigms in that individuals cannot be “pigeonholed” in a The first, the concept of “autonomy”, as applied as The tofirst,the so “autonomy”, of concept the is understood as “self-determicial agent. “Autonomy” meaning thatnation”; the cause the of action be to is not Boudon, MichelBoudon, Crozier and Elster. Jon methodologicalcerning (non-atomistic) individualism. Alexis de Tocqueville, Georg Simmel, Karl Max Menger, Alfred Herbert Spencer, Schütz,Weber, Ludwig Mises, von RobertKarl C. Merton, Popper, Friedrich Raymond Hayek, tradition that is non-atomistic. Thisnon-atomistic indi vidualistic tradition is long-standing and includes Adam Smith, Bernard Mandeville, David Hume, Montesquieu, argues that methodological individualism cannot be re duced this to atomistic variant because there and is a long authoritative philosophical and sociological individualistic atomistic conception society. of While acknowl Di Iorio edgesthat an atomistic variantmethodological of indi vidualism does exist standard he (e.g. economic models), action, strives Di Iorio offer to originalan reading of Hayek. often been misunderstood, having been confused with an ceives individual of actions be to understood as being caused an by active process interpretation of the on part of the subject. Focusing issues on related the to philosophy of cal Individualism andinvestigates contribution Hayek’s methodological to individualism and the Francesco Di Iorio’s Francesco Di Iorio’s Berlin and New York: Springer, 2015, 189 pages. $129.00 189 pages. 2015, Springer, York: Berlin and New GABRIELE CIAMPINI GABRIELE University Florence/Paris-Sorbonne of University Cognitive AutonomyThe and Interpretative Methodological Foundations Individualism: of Social Life REVIEW VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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Chapter 2 deepens Hayek’s critique of the holistic ap- by connecting spontaneously to each other. They cre- proach to the social sciences. Holism denies the intentional ate complex chains of impulses that correspond to the dimension of human action, maintaining that social order different kinds of “patterns” humans are able to recog- is predetermined by social laws—laws that control the in- nize (p. 40). dividuals. Hayek takes holists to task for not understanding that the social world is largely the result of unintentional Taking Hayek’s idea of mind as a self-organizing-system, purposeful human actions. Di Iorio clarifies the cognitive Di Iorio illustrates how Hayek uses the idea to criticize presuppositions of action from the standpoint of non-at- some cognitive theories, such as behaviorism and, especial- omistic methodological individualism. Di Iorio illustrates ly, methodological holism. Despite their differences, these the agreement between Hayek and Gadamer regarding the two approaches share the basic assumption that the cause of interpretative nature of knowledge, stating that Hayek’s action must be sought outside the individual: “Behaviorists theory of the sensory order is consistent with the herme- consider action to be determined mechanically by physical neutical theory of knowledge: “Hayek and Gadamer also reality, understood as a pre-given reality, while sociological agreed that, since the human being is an interpreter, he/she holists consider action to be determined mechanically by is hermeneutically free” (p. 12), i.e., a self-determined being. the socio-cultural environment, which they similarly regard For Di Iorio, Hayek’s originality resides in that he was one as a pre-given reality” (p. 55). of the first thinkers who sought to establish a link between Both approaches deny the interpretation that social a theory of individual autonomy analogous to hermeneutics agents give their surroundings is relevant and that the mind and phenomenology with cognitive psychology. Di Iorio is a self-organizing system that acts as a “cause of itself”, argues that the epistemological implications of Hayek’s The meaning it is self-determined and cannot be perturbed by Sensory Order (1952) have not been sufficiently analysed by external factors (p. 44). This is where the connection be- 105 social philosophers. In his view, the connections between tween Verstehen sociology and Hayek’s cognitive psychol- Hayek’s theory of mind and the Verstehen tradition are ogy comes into play. According to Hayek, the social context relevant from the standpoint of the individualism-holism does not determine the actions of individuals, but how debate precisely because Hayek’s theory of mind supports they interpret the context is what causes their actions. Di human autonomy as understood by methodological indi- Iorio further explains that for Hayek human interpretative COSMOS + TAXIS + TAXIS COSMOS vidualism: “One of the goals is to demonstrate that Hayek’s autonomy is not absolute. Social factors play a role in the reflections on mind include a very original argument in fa- cognitive process and influence individual action. However, vor of Verstehen, an argument that has been rather neglect- their influence is not mechanical because there is always a ed within the philosophy of the social sciences” (p.1). Hayek dialectic between these factors and the way in which the conceives of the mind as a complex dynamic system—a sys- individual interprets them. tem that can only be explained through an “explanation of Chapter 3 investigates in more detail the relevance of the principle” (p. 40). The logic of this system determines Hayek’s The Sensory Order to the individualism/holism the existence of consciousness from a neurophysiological debate. Hayek argued that methodological holism and be- point of view as well as the cognitive autonomy of the agent. haviorism are governed by the same mechanistic paradigm, Hayek’s philosophy of the mind is inconsistent with the that denies the interpretative activity of the individual. Di mind-computer analogy. Those who believe that the mind Iorio, interestingly, connects Hayek’s theory of mind to that works like a computer assume that every cognitive func- of Maurice Merleau-Ponty who also argued that the mind tion is due to a “decision-making center,” i.e., to the Central is a self-organizing system and that action is always de- Processing Unit (CPU) which controls every mental activity termined by the interpretation by the subject, and on that through a predetermined “protocol.” Hayek’s vision is dia- ground criticized sociological holism. Hayek and Merleau- metrically opposed to this: Ponty (a phenomenologist strongly influenced by Edmund Husserl), are commonly regarded as being very dissimi- the mind is made up of billions of components— lar to each other. However, Hayek claimed that Merleau- neurons—whose activity is not pre-programmed but Ponty developed a perspective very similar to his own. As self-determined. The neurons do not follow specific Di Iorio stresses, both these thinkers shared a critique of instructions, but work in a sense in an independent the objectivist conception of knowledge and explained the manner. They build up the perceptive categorizations mind in terms of self-organizing system and interpretative
REVIEW Cognitive Autonomy and Methodological Individualism: The Interpretative Foundations of Social Life by Francesco Di Iorio ------Following Hayek,
tradition as understood herme by Verstehen
The finalchapter of the book deals with the relationship In Chapter Di Iorio stresses 5, that methodological indi of methodological individualismof compatible with the meth theodology natural of sciences?” (p. 8). MisesPopper, and Carl Hempel, Di Iorio argues “that the interpretative approach is incompatible not with the use of covering and laws, more generally with the methodology the naturalof While sciences” and (Ibid.). Hayek Mises are sometimes ambiguous on this issue, their some of writings “imply in a belief a common methodology between the so utilitarianism and support a broader conception rational of claimingity, that all human actions,including those carried without out utilitariana purpose,based not on an instru mental rationality, must be considered rational. Following andHayek the neutics and interpretative Di Iorio defends a sociology, broad concept rationality. considers He of rationality to be generala feature humanof action and assumes that even religious beliefs, ethical and choices, attitudes that cannot be explained in utilitarian terms and that are commonly regarded as irrational, are actually rational because they presupposealways “an intelligent process interpretation of and meaning-construction” must Action be never (p. 125). seen as an uncritical adherence to existing cultural mod becauseels presupposes always it an on the active part role the socialof agent. As argued Boudon and by Gadamer, rationalitythe agent’s necessarily is not utilitarian and Cartesian. can It also be argumentative, fallible and char acterizedcertain a by vagueness. This second kind ra of tionality is termed Boudon as by “cognitive” or “ordinary” rationality. between interpretation and explanation. attempts It to an swer the question:following “Is theinterpretative approach have conceived societyhave in holisticterms and regarded ac tion as determined holistic by macro-laws that control the individual and make the social order possible. Even struc turalism is affected this by holistic approach: the idea that the societies eachhistorical of period are characterized theby presence ‘structures’ of that determine a particular cultural and economic order has at its base the conception originally and Comte. Hegel by developed vidualism has often been confused with a utilitarian theory actionof and criticized because its commitment of to utili tarianism. According to Di the Iorio, confusion between methodological individualism and utilitarianism must be becauseavoided utilitarianism is only one variant meth of individualism.odological and Hayek other methodological individualists such as Mises and Boudon agree do not with ------Following Hayek, thisFollowing “chapter attempts to
ry provide to a reassuring view and drive the out fear 87). chaosof (p. Onthese grounds, society is conceivedas something of theirof epoch. Theirorganicism must be considered, among other things, as a conservative reaction the to ideas its Revolution, subversive andFrench the de structive modern egoism of industrial society. Both andComte in their Hegel, of spite philosophical dif ferences, developed a collectivist and historicist theo Comte’s and Hegel’s organicist and Hegel’s theoryComte’s society of is re lated their to concern the social for profound changes Chapter 4 analyses the “how interpretative autonomy of
Alfred Radcliffe-BrownParsons. and Talcott Theseauthors harmony and social order have Comteand possible. Hegel influenced, albeit in differentways, several social theories that came from later, Durkheim to Bronislaw Malinowski, that transcends the individual; from is ‘emancipated’ it its individual components. is seen It as an independent phe nomenon thatcontrols individuals fromoutside and makes connected to a deterministic conception historical of devel Di Iorio statesopment” that: (p. 79). between Positivismand Idealism,never Comteand Hegel theless share some common points. In particular, both de a theoryfend action of based on the heteronomy idea of and Hayek, DiOrio targetsand Comte, two Hegel very differ entthinkers, shared who but an organicist conception of society: “In the spite strong of and undeniable differences Kinkaid,Lars in the Udehn) last decadesfew arecarefully analysedand criticized. This chapterreconstructs theintel lectual roots both of individualism and holism. Following pretations methodologicalindividualism (non-atomistic) of Bhaskar, Harold Roy various by developed authors (e.g., omistic methodological individualism, and the that way this approachreconciles theindeterminism action of and exis tence socialconditioning” of (Ibid). The reductionist inter the actor is related to the systemic structure the social of (p. 76). world” clarify thetheory socialsystems of as intended non-at by terpretative apparatus implies a criticism sociological of holism” (Ibid.). Andreading “Consequently, in Hayek the Merleau- light of Ponty isextremely useful understanding for the why idea that mind self-organizing is a complex system and an in device: “Merleau-Pontydevice: studied in greater depth the is thesue impossibility of explaining of consciousness as an epiphenomenon sociality” of in (p. holistici.e. 6), terms. VOLUME 5 | ISSUE 3 + 4 2018 5 | ISSUE VOLUME
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cial and the natural sciences” (Ibid.). Hayek’s epistemology is compared to Mises’ and Popper’s ideas. Following Barry Smith, and Hayek himself, Di Iorio criticizes “the wide- spread thesis that the epistemological views of these two authors are radically incompatible” (p. 8) and stresses “that Mises’ apriorism and Popper’s fallibilism are reconcilable” (p. 9). On these grounds, Di Iorio argues “that Hayek’s de- fense of fallibilism must not be interpreted as a radical cri- tique of Mises” (p. 9). Di Iorio’s book is an original and valuable contribution to the philosophy of social science that breaks new ground in our understanding of Hayek’s thought and of methodologi- cal individualism more generally. One of the great merits of the books is that it demonstrates why many biases on the account of which methodological individualism is usually criticized must be rejected as being both logically and his- torically unfounded.
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