Hayek and Rand on values — APEE 2011 conference

For this year’s conference of the Association of Private Enterprise Education, I am organizing and chairing a session on two giants of the twentieth century — Friedrich Hayek and Ayn Rand — with four scholars comparing their views on values and political economy.

Topic: Hayek and Rand on Values

Chair: Stephen Hicks, Ph.D., Rockford College, Illinois

Panelists:

Emily Chamlee-Wright, Ph.D. Elbert Neese Professor of Economics, Beloit College, Wisconsin
Title: “Cultivating the Economic Imagination with Atlas Shrugged”
Abstract: In this paper I describe my use of Ayn Rand’s Atlas Shrugged in an undergraduate comparative economic systems course. I argue that the novel is the ideal vehicle for cultivating what I call the “economic imagination,” by which I mean the ability to see the systematic outcomes that emerge under different political economic rules of the game. Further, I argue that the novel is particularly well-suited to animate discussions of essential comparative systems topics, including Marxism, the various phenomena associated with the soviet-type economy, and fascism. Finally, drawing upon student writing, I argue that though Rand’s view of reason and epistemology are often at odds with Austrian economics, these tensions are productive in conveying Austrian insights regarding the extended order.

Steve Horwitz, Ph.D., Professor of Economics, St. Lawrence University, New York
“Hayek, Rand, and the Ethics of the Micro- and Macro-worlds
Abstract: Hayek and Rand both supported capitalism, but their ethical systems were different. This paper explores the differences and how they apply to the institution of the family. It concludes that Rand’s ethical system matches very well with what Hayek sees as necessary in the “Great Society” of the macro-cosmos, but that our understanding of the institution of the family seems better suited to a more altruistic ethical code. The challenge for a Hayekian ethics that pays attention to institutional contexts is how to ensure that the complex process of making those distinctions is learned as children pass into adulthood.

Edward Hudgins, Ph.D., Director of Advocacy, The Atlas Society, Washington, D.C.
Title: “Is a Moral Foundation Necessary for Spontaneous Order?”
Abstract: F. A. Hayek argued that social order and institutions—markets, money, law—arise spontaneously out of the actions of individuals seeking their own interests but not through specific planning by individuals. Further, because it is impossible in markets for any individual to know what mix of goods and services will best satisfy consumer demands, attempts at central government planning will result in adverse unintended consequences.
But it can be argued that such a system will only operate to protect individual liberty and limit government if enough individuals, reinforced by the culture, accept and live by certain moral principles and the Objectivism provides such a foundation.

William Kline, Ph.D., Assistant Professor of Philosophy, Department of Liberal and Integrative Studies, University of Illinois, Springfield
Title: “Individualism and Interdependence”
Abstract: When do we need other people? Both Hayek and Rand agree on the importance of the division of labor. People need other people to produce what they cannot or will not do themselves. Hayek and Rand also broadly agree on the importance of property rights that make the division of labor, and the market in general, possible. Yet, theses authors deeply disagree on the degree of interdependence necessary for establishing valid property claims. This paper explores Hayek’s use of a Humean conception of property that emphasizes tradition and cannot exist independently of others and contrasts it with Rand’s use of a Lockean/Cartesian approach that argues for the existence of objective, nonconventional property rights. This paper argues that the two authors can be reconciled by distinguishing between what Hume identifies as the need for property rights versus the actual rules that protect them.

The session is scheduled for Monday, April 10 at the bright and cheery 8:10 a.m. time slot.

Keynote lecture in Argentina

I will be giving a keynote lecture in Argentina at the invitation of the Bases Foundation and the School of Economics of the Catholic University in Rosario. The event is the Third International Conference on “The Austrian School of Economics in the 21st Century,” which will be held August 5-7, 2010.

The title of my lecture is: “Austrians, Objectivists, and the Unrequited Love of Philosophy for Economics.” Here is the abstract:

The Austrian school of economics and the Objectivist school of philosophy have both been essential to the liberal/libertarian movement. Mises and Hayek did much work in political economy and explored relevant philosophical issues in metaphysics, epistemology, and values. Rand did much work in philosophy, which she then applied in fictional portrayals of mixed political economies in decline. Yet while there is mutual respect between Austrianism and Objectivism, there are also points of tension. My purpose in this talk is to discuss the key commonalities and differences. Much specialized work in economics and philosophy must be done, so there is a natural and important division of labor. But that work must also be coordinated in making a full and compelling case for the free society.

Thanks for the invitation to Federico Fernandez, the Bases Foundation, and the School of Economics at Catholic University of Rosario.

The Bases Foundation takes its inspiration from Juan Bautista Alberdi, one of the great nineteenth-century Argentine Enlightenment liberal political theorists.

APEE talk on the mixed economy

At the APEE conference next month in Las Vegas, I will be presenting “The Evolution of the Mixed Economy - A Schematic Approach.”

My talk integrates themes from several major thinkers from whom I have learned a great deal: Adam Smith, Ludwig von Mises, Ayn Rand, Friedrich Hayek, Milton Friedman, James Buchanan, and Gordon Tullock.

The talk’s outline is based on this flow chart posted earlier under the title “Pathologies of the mixed economy (or, How we got into this frackin’ mess).”

For the conference I’ve also organized two other sessions: Ethics and the Financial Crisis and Reason in Hayek and Rand.

Here is the full conference schedule.

Hayek and Rand on reason — APEE panelists

In addition to the session on Ethics and the Financial Crisis, I am chairing a session on the theme of “Reason in Hayek and Rand” for the Association for Private Enterprise Education conference to be held April 11-13, 2010 in Las Vegas, Nevada.

The rationale for the session: Two giants of twentieth-century thought — but few comparative studies have been done. The following panelists will discuss how Friedrich Hayek’s account of reason compares to Ayn Rand’s.

Reason in Hayek and Rand
Chair: Stephen Hicks, Rockford College

Jennifer Baker, College of Charleston
Title: “Buying and Value”
Abstract: F. A. Hayek and Ayn Rand have very distinct descriptions of consumer behavior. Rand describes consumers purchasing what they do as an acknowledgement of the value of the product. Hayek reprimands economists who make a similar description, as it is a clear “mistake.” What causes one account to differ from another on this matter? What is at stake when it comes to the rationality ascribed to consumer choice? In this paper I lay out the Randian and Hayekian alternatives and assess them against each other.

David Kelley, Atlas Society
Title: “Rand vs. Hayek on Abstraction”
Abstract: Both Ayn Rand and Friedrich Hayek understood that the political institutions of freedom rest on cultural foundations. Both thinkers held that individuals are influenced by the beliefs, values, and practice of their culture. Both believed that civilization has progressed from the tribalism of primitive societies toward the greater individualism of modern liberal society. At a deeper level, however, Rand and Hayek differ profoundly about the nature of culture and cultural change. Rand holds that cultural practices rest on ideas that are the product of reason and open to rational assessment. Hayek offers an evolutionary account in which ideas as well as practices are acquired by imitation and spread by a kind of natural selection.
This difference is in large part the result of more fundamental differences in their respective epistemological views. In this paper, I will discuss one central issue that I believe underlies many of the others. That issue concerns the nature of abstractions—our concepts for general kinds of their and their common attributes, and the abstract principles and rules that we form with our concepts. Rand held that we form abstractions from the observation of particular, concrete things. Hayek held the opposite view that abstractions are primary; some are innate, some acquired from our cultural environment, but neither can be independently supported by observation of concretes. Though Hayek’s view is in some ways more in tune with current theories of cognition, I will argue that it is both false and inconsistent with a fully individualist moral and political theory.

Tibor Machan, Chapman University
Title: “Hayek and Rand on Constructive Rationalism”
Abstract: F. A. Hayek was suspicious of constructive rationalism and this has sometimes been taken to amount to a diminution of human reason in Hayek’s eyes. Ayn Rand, in contrast, has embraced human reason as the primary means for people to grasp reality and to guide themselves as they conduct their lives.
Do Hayek and Rand disagree? Yes, Ayn Rand has been very harshly critical of Hayek, judging by her marginalia of The Road to Serfdom (see Robert Mayhew, ed., Ayn Rand’s Marginalia). But her focus in these comments was Hayek’s allegedly infelicitous writing and thus sloppy thinking, not so much his positions on various issues and even less his ideas concerning human reason. In other contexts Rand has been identified as a critic of rationalism, which could be taken as paralleling Hayek’s objection to constructive rationalism. I plan to explore these matters.

Alexei Marcoux, Loyola University Chicago
Title: “Hayek’s Epistemic Case for Entrepreneurial Capitalism”
Abstract: One case for entrepreneurial capitalism is straightforwardly philosophical. A handful of fundamental principles are announced and argued for. Then it is shown that an entrepreneurial capitalist social order follows from the principles announced and defended. Roughly, this is the approach of libertarian defenders of the market like Murray Rothbard, Robert Nozick, and Ayn Rand. Another case for entrepreneurial capitalism proceeds differently. It is based on an account of the epistemic limitations of human beings and what works to their advantage given those limitations. This is the approach of F. A. Hayek. In a long and prolific career that saw him make significant contributions to economics, psychology, and social and political philosophy, the common thread in Hayek’s thought is the limits of human cognition. Those limits undermine the prospects of socialist calculation and of the technocratic, managerial capitalism taught in university-based business schools and championed by thinkers like Alfred Chandler and J. K. Galbraith. The case based on epistemic limitations is contingent rather than necessary. For that reason (among others), it draws fire from other defenders of entrepreneurial capitalism for being insufficiently definite. Parallels in the thought of Michael Oakeshott will also be discussed.

Hayek and Rand on reason

I am organizing a session for the Association for Private Enterprise Education conference to be held April 11-13, 2010 in Las Vegas, Nevada. The theme is “Reason in Hayek and Rand.”

Here we have two giants of twentieth-century thought, but few comparative studies have been done. So as a start I have chosen Reason as a focusing theme and have solicited papers from several scholars on topics such as the following:

* How does Friedrich Hayek’s account of reason compare to Ayn Rand’s?

* Hayek is more focused on reason’s role in social causation while Rand is more focused on reason as an individual phenomenon. True?

* Is it accurate to say that Hayek is a sociologist of reason while Rand is a philosopher of reason?

* Hayek is an empiricist, broadly speaking, as is Rand, but Hayek’s reason is more Humean while Rand’s is more Aristotelian. True?

* Hayek has been interpreted as being a skeptic about reason and as tending to postmodernism (e.g., by Theodore Burczak). True? And if so, does this put him in direct contrast to Rand, who is a strong anti-skeptic?

* Hayek sometimes seems ambivalent about the relation between reason-based discoveries of social science and normative issues. Rand tightly integrates reason’s descriptive and normative functions. Issue here?

* On socialism: Hayek argues a reason-as-fatal-conceit thesis, while Rand places the blame primarily on an ultimately irrational altruism. Are these interpretations complementary or in conflict?

When the session’s panel is finalized, I’ll post it.

An inspiring university points to the future

Atlas is not shrugging at Francisco Marroquín University in Guatemala.

I was there to give a talk on “Is Economics Value-Free?” [answer: No, and that's a good thing] at the Association for Private Enterprise Education conference. This sign made it feel like an intellectual homecoming [click the images for full size]:

The first academic building one comes to at the university has this sculpture and accompanying plaque:

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Thanks to co-hosts FMU and APEE for a memorable event. Thanks also to organizer Douglas Rasmussen and my co-sessionists Alexei Marcoux, Pierre Garello, and Aeon Skoble for a good discussion of a fundamental issue in philosophy of economics. (The 80-degree weather and heated, outdoor pool weren’t bad either.)

Update: Joshua Hall of Beloit College, by way of thanking FMU and its students for their co-hosting the conference, has this link for those who would like to make a donation to FMU’s student scholarship fund.

Pathologies of the mixed economy (or, How we got into this frackin’ mess)

Putting into one flowchart what I have learned from Adam Smith, Ayn Rand, Ludwig von Mises, Friedrich Hayek, Milton Friedman, James Buchanan, and Gordon Tullock.

The flowchart is in spreadsheet format: the short version and the long version in Excel 2007 or in Excel 97-2003. Update: DJ Dates has a cool, scalable Google maps version of the flowchart at his website.

Feel welcome to modify and add to as you wish.

I’m in the midst of discussing this material in my Business and Economic Ethics course, in a unit on business ethics in a mixed economy.

For reference purposes:

Academic title: “The Sociology of Dysfunctional Nonstandard Political-Economic Systems.”

Public Intellectual title: “The Evolution of the Mixed Economy.”

Casual title: “How We Got Into This Frackin’ Mess.”