Purposeful Behaviour, Expectations, and the Mirage of Social Justice: The Influence of Cybernetics on the Thought of F.A. Hayek

Abstract

This paper examines the influence of cybernetics on the development of Friedrich Hayek’s postwar work in theoretical psychology, economics, and social theory.

The first part of the paper centres on an examination of various drafts of Hayek’s 1952 book The Sensory Order, which reveals that, in developing his account of the working of the mind, Hayek drew on the seminal work of British cybernetician Kenneth Craik (one of the founders of the discipline of cybernetics). It is argued that in particular that Hayek drew on Craik’s work in developing his account of how the pattern of impulses proceeding through the neurons in a person’s brain constitutes a model of the external world that enables the person to form expectations about future events in his/her environment, on the basis of which they are able to form plans that are likely to come to fruition. It is also argued that a reading of the work of some of the other founders of cybernetics, such as Norbert Wiener and Warren McCulloch, helped Hayek to extend his account of the working of the mind so as to encompass purposeful human action, most notably through Hayek’s appropriation from cybernetics of the notion of “negative feedback” .

The second part of the paper investigates the extent to which ideas drawn from cybernetics influenced Hayek’s economics and social philosophy. On the basis of an inventory of those places in his writings on economics and social theory where Hayek mentions cybernetics, it is argued first of all that the key elements of Hayek’s finished account of the generation of the market order or catallaxy were well known to him, and had been marshalled by him into a coherent account of how such order is possible in decentralised market economies, independent of his acquaintance with cybernetics. That is to say, it appears that cybernetics did not shape the development of Hayek’s economics in a significant way. However, the evidence also suggests that Hayek did make made significant use of ideas drawn from cybernetics in developing his broader social theory, in particular his critique of social justice. More specifically, it is argued that the notion of negative feedback played an important role in Hayek’s efforts to justify his claim that the market process invariably involves the systematic disappointment of people’s expectations and that, as a result, the outcome of the market is one to which the notion of social justice is inapplicable. In this way, cybernetics and, in particular, the notion of negative feedback, did play an important role in Hayek’s broader social theory, by providing him with a conceptual bridge through which he could (attempt to) connect his account of the market order with his critique of social justice.

Finally, the consistency of the ways in which Hayek uses cybernetics both with the subjectivist account of human action that informs his economics, and also with his account of the notion of “spontaneous order”, is considered.

Keywords: Hayek, Cybernetics, Complexity, Feedback, Psychology, Purpose, Action, Catallaxay, Order, Social Justice

JEL Classification: A00, B21, B29, B30, B31, B40, B41, A12