Download The cultural evolution of a rule of conduct: Hayek`s epistemology

The cultural evolution of a rule: Hayek’s epistemology and evolutionary theories in
biological anthropology
Chiara Chelini1
1 University of Torino, Department of Economics Cognetti De Martiis
[email protected]
Abstract
The aim of this paper is to present the claim that Hayek’s theory of knowledge is
compatible with modern evolutionary theories about cultural transmission in biological
anthropology. In Hayek’s writings, the emergence of norms and the importance of imitation and
social learning are related to a process of cultural evolution and spread of rules through the
mechanism of the market that enables economic agents to use the knowledge dispersed and
fragmented among idiosyncratic individuals. In particular, Hayek explains how our institutions are
shaped by a process that consider the role of our cultural heritage: what is learned is passed on both
an individual and a societal level and rules of behaviour are characterized by a feedback process, an
adaptation and continuous adjustment with the surrounding environment. In Hayek’s epistemology,
the most important problem that economic theory should try to solve is not the allocation of scarce
resources but the distribution and utilization of fragmented knowledge. In the first section I’ll
explain the process of norms formation following Hayek’s contribution and focusing on the limits
of human rationality. Then, the core of the paper will explain in details how evolutionary theories
developed in biological anthropology can provide an interesting tool of research that would be able
to integrate Hayek's concept of cultural evolution. Finally, I want to address a methodological
question about what the implications in economic theory are: given that this strong comparison
among Hayek’s epistemology and modern evolutionary theories in biological anthropology holds,
what are the further lines of research that should be developed?
JEL Classification: A11, B25, B41, B52, D83
Keywords: Hayek, knowledge, cultural evolution, emergence of norms, economic methodology
1
1. Introduction
Humans are social animals: in the Western and globalise world they operate in largescale societies, they are continuously involved in social interactions that make them meeting other
people, thinking about their interests and the interests of the groups which they belong to, acting on
market activities, travelling abroad in different continents, teaching and learning from others
members of their communities what is good or bad to be done in a specific domains. Everything in
human life is about social interactions and human agents in the course of their life are willing to
perform different kind of interactions related to their particular aims, skills and performance. Every
action is about coordinate your own behaviour with the one of the others who live around us who in
their turn are willing to coordinate their actions with other people.
But, how human agents can behave in ways that do not hinder others interests and
desires? How different groups made by different individuals with opposite desires can be satisfied
with the outcome of their actions when there are conflict of interests? There must be something in
human activities that structures the behaviour of everyone given the behaviour of everyone else, in a
way that is not mainly shaped by enforced laws, coercion or governmental powers. There must be
something tacitly coded, not explicitly written but largely shared among people who live in the
same community or practice the same kind of activities. There must be conventions and social
norms that regulate human relationships. “At any rate, it was not through direction by rulers, but
through the development of customs on which expectations of the individuals could be based, that
general rules of conduct came to be accepted.”1 Agents make inferences about other people’s
behaviour and try to understand if they are willing to conform to a specific norm given a certain
situation. Each rule, therefore, is cue-triggering: each particular situation carries some specific
symbolic cue that makes different people behaving in different ways. Each rule is contextdependent and it is associated with the activation of some preference that make the agent behaving
in a certain way and abide by the rule. But this preference is “conditional” on the decision context:
this means that, given a specific situation, “people are by no means uniform in their propensities”
and we should have a theory able to account “how people map context into specific interpretations,
that involve, among other things, expectations and inferences about other people’s motives and
other behaviours. Such interpretations (...) often imply shared rules about how is to be done in
specific situation”2.
1
Hayek, F.A. (1973) Law Legislation and Liberty, Vol 1., Chicago, University of Chicago Press, page 82.
2
Bicchieri, C. (2006) The Grammar of Society: The Nature and Dynamics of Social Norms, Cambridge University
Press, page 56.
2
2. Knowledge and Social Norms
In modelling economic human behaviour, all that we can put as a constraint is a
constraint about rationality and knowledge and about institutions that shape and lead human
activities. “Man is much a rule-following animal as a purpose-seeking one. And he is successful not
because he knows why he ought to observe the rules which he does observe, or is even capable of
stating all these rules in words, but because his thinking and acting are governed by rules which
have by a process of selection been evolved in the society in which he lives, and which are thus the
product of the experience of generations.”3 Humans are learning animals but they are also rulefollowing creatures: “Man is not only a learning animal; he is a pattern-finding and conceptforming animal.”4 And every prediction is mainly a “pattern prediction” or “explanation of the
principle”: “My basic approach to economics is that economic mechanism is a process of adaptation
to widely dispersed knowledge, which nobody can possess as a whole. And this process of
adaptation to knowledge, which people currently acquire in the course of events, must produce
results which are unpredictable. The whole economic process is a process of adaptation to
unforeseen changes which, in a sense, is self-evident, because we could never have planned how we
would arrange things once and for all and could just go on with our original plans.” 5 Since
neoclassical economic doesn’t account for the limits of human rationality, it doesn’t account for the
importance of social norms, rule of conduct and institutions. Game theory account for them but
only inside a paradigm of full rationality that cannot give any significant explanation to more
complex real life situations. Hayek’s assessment about game theory is very critical: reading the
report of his Nobel Lecture interview, I found out that he considers game theory an interesting
branch of mathematics, that, however, doesn’t give any significant contribution to economic theory,
in which every decisions is a matter of discrete and isolated events and judgments that cannot be
underpinned on the assumption of full rationality and prediction of all the possible outcomes.
“Nearly everything I say about the methodology of economics amounts to a limitation of the
possible knowledge.”6 This does not mean that the individual acts without concerning about others
around him, rather that his choice cannot be predicted in an aggregate way. The main problem of
economic science is a problem of distribution of knowledge. Each individual is isolated in the sense
that he is “the man on the spot”7: “every individual has some advantages over all others because he
3
Hayek, F.A. (1973) Law Legislation and Liberty, Vol 1., Chicago, University of Chicago Press, page 11
Simon, H. (1959). “Theories of Decision Making in Economics and Behavioral Science” The American Economic
Review, 49 (3), page 272.
5 Hayek, F.A. (1983) Nobel Prize-winning economist. Transcript from an oral history interview conducted in 1978
under the auspiecies of the Oral History Program, University Library, UCLA, Copyright, Regents of the University
6 UCLA Oral History Program, page 146
7 Hayek, F.A. (1945.) “The Use of Knowledge in Society”, The American Economic Review, 35, (4), page 524.
4
3
possess unique information of which beneficial use might be made, but of which use can be made
only if the decisions depending on it are left to him or are made with his active co-operation.”8
Therefore, isolation means that each economic agent owns only a fraction of all the knowledge that
is available, a fraction that is inevitably limited by the particular circumstances of time and place.
But all economics activities are about interactions: which is the best seller who can provide me the
goods and services I need? And which are the best buyers for a particular set of traders? “In actual
life the fact that our inadequate knowledge of available commodities or services is made up for our
own experience with the persons or firms supplying them- that competition is in a large measure
competition for reputation or good will- is one of the most important facts which enables us to solve
our daily problems.”9 We do not know if the knowledge we possess about the goods and services
we would like to get is a right approximation of the reality: the process of acquisition of knowledge
is always a mechanism of adjustment with the environment around us, but in every economic
models about perfect competition all the data are already adjusted, the mechanism is static and
competition is already got. The main goal, in Hayek’s view, that economic activity can achieve is
not picking out the person who best knows in a particular domain, but making the person who owns
particular skills in a certain domain meeting with particular practices that fit to her particular
knowledge. Therefore, competition cannot be perfect in the way traditional economic textbook
defines it since agents involved in economic activities do not possess perfect knowledge of all the
available alternatives: the buyer possesses the knowledge about the particular value he attributes to
a particular commodity, the seller owns the knowledge about the costs of the production factors he
utilizes. So, we need the help of some institutions that can provide us a framework: in Hayek’s
opinion, the price mechanism is the tool that makes the knowledge spread and allow everyone to
possess more knowledge than otherwise he would have. But even if the mechanism of relative
prices is one of these institutions, man “is still very far of having learnt to make the best use of it.”
10
Even the market can be defined as a “rule of thumb”: we do not know if it will be the best
institutional arrangements that we can achieve, but, given the limits of our information and
knowledge, it is the one that better provide a system of general and abstract rules of conducts we
can abide by. A consistent critique of the behavioural assumptions of economics- i.e. full rationality
of agents, transitivity of preferences and self-maximizing behaviour- is underpinned on changes in
relatives prices that determines, on the other end, changes in human tastes and preferences. 11 The
aim of this line of research is, therefore, to investigate which particular factors can lead to changing
in a consistent way a human pattern of behaviour. In particular, we find that studying this topic is
Hayek, F.A. (1945.) “The Use of Knowledge in Society”, The American Economic Review, 35, (4), page 521-522.
Hayek, F.A. (1948). Individualism and Economic Order, Chicago, University of Chicago Press, page 97.
10 Hayek, F.A. (1945.) “The Use of Knowledge in Society”, The American Economic Review, 35, (4), page 528
11 North, D.C. (1990). Institutions, institutional change and economic performance, Cambridge UK and New York:
Cambridge University Press.
8
9
4
fundamental in a field that do not consider strictly profit maximization “the core” of economics.
“No society would be viable without some norms and rules of conduct. Such norms and rules are
necessary for viability exactly in fields where strictly economic incentives are absent or cannot be
created.”12 Between the claim of oneself- that is pure self-seeking behaviour and egoism- and the
claims of all- that is utilitarianism- there is the claims of a variety of groups such as family, peer,
social classes whose behaviour is underpinned on rules of conduct in a tacit or codified way. Such
concepts as family responsibility, business ethics, class consciousness, belong to the general field of
research of commitment, that can be considered as a special application of a rule of conduct that do
not allow profit maximization. This lack of personal gain in particular acts can be accepted “by
consider the value of rules of behaviour”13 When Sen explains his disagreement with the general
validity of the utility-maximization theory, he stresses the point that human preferences are
changing in accordance with environment, consumer decisions, production activities and therefore
“it is very much an open question as to whether the complex psychological issues underlying
choices (...) can be at all captured within the formal limits of consistent choice on which the
welfare-maximization approach depends.”14 Douglas North agrees with this point, stating that a
great deal of economic activities are not of wealth-maximizing behaviour, but of “altruism and selfimposed constraints” that make people deciphering the environment. Similarly, we find that people
decipher the environment “by processing information through pre existing mental construct”
through which they confront they problem they have to solve.. “Both the computational abilities of
the players and the complexity of the problems to be solved must be taken into account in
understanding the issues.”15
The problem of diffusion and utilization of knowledge is by no means peculiar only of
economics, but “it arises in connection with nearly all truly social phenomena, with language, and
with most of our cultural inheritance, and constitutes really the all central theoretical problem of all
social science(...) We make constant use of formulas, symbols and rules whose meaning we do not
understand and through the use of which we avail ourselves of the assistance of knowledge which
individually we do not possess.”16 Therefore, rules of conducts are useful “to copy with our
constitutional ignorance”17], if people were omniscient they would be not necessary at all. Rules of
conducts are a tool that can provide a pattern to follow, they may enhance the certainty of
Sen, A.K. (1977). “Rational Fools: A critique of the behavioural foundations of economic theory”. Philosophy and
Public Affairs, 6, (4), page 332.
13 Sen, A.K. (1977). “Rational Fools: A critique of the behavioural foundations of economic theory”. Philosophy and
Public Affairs, 6, (4), page 342
14 Sen, A.K. (1977). “Rational Fools: A critique of the behavioural foundations of economic theory”. Philosophy and
Public Affairs, 6, (4), page 324
15 North, D.C. (1990). Institutions, institutional change and economic performance, Cambridge UK and New York:
Cambridge University Press, page 20.
16 Hayek, F.A. (1945.) “The Use of Knowledge in Society”, The American Economic Review, 35, (4), page 528.
17 Hayek, F.A. (1976) Law Legislation and Liberty, Vol. 2, Chicago, University of Chicago Press, page 8.
12
5
expectations “not determining a particular concrete state of things, but by determining only an
abstract order which enables its members to derive from the particulars known to them expectations
that have a good chance of being correct;”18 and even in relation to the possibility of making
prediction in economics, Hayek believes that “you cannot build a theory on the basis of statistical
information, because it’s not aggregates and averages which operate upon each other, but individual
actions. And you cannot use statistics to explain the extremely complex structure of society. So,
while I will use statistics as information about current events, I think their scientific value is rather
much more limited than the American economists of the last thirty or forty years have believed.” 19
In particular, in his opinion, the science can deal with three different kind of phenomena: physical
ones, mass and demographical phenomena and finally economic phenomena. While in physical and
mass phenomena if you cannot get the information on the particular events, you can substitute
probabilities for them, in an intermediate type of events, where you have to deal with complex
phenomena, you cannot ascertain all the individual events, and these are not sufficiently mass
phenomena to be able to substitute probabilities for the information on the individual events. “In
that filed I am afraid we are very limited. We can build up beautiful theories which would explain
everything, if we could fit into the blanks of the formulae of the specific information. Therefore, all
we can explain is what I like to call pattern prediction. You can predict what sort of pattern will
form itself, but the specific manifestation of it depends on the number of specific data, which you
can never completely ascertain. Therefore, in that intermediate field, intermediate between the
fields where you can substitute probabilities for the data- you are very limited in your predictive
capacities.”20 This intermediate field is economics that, in Hayek’s view, deals with the problem of
knowledge and cultural evolution of rules. Institutions are a response to this imperfect knowledge,
therefore “they cannot be rationally chosen (in the technical sense used by economists); they may
have unexpected consequences, both beneficial and harmful, and are likely to change over time.
Thus, institutional economics must be evolutionary economics, and evolutionary economics must
be institutional economics, for in a world of imperfect knowledge and a bounded rationality,
processes must be structured by institutions"21
21. Rule-following behaviour: social norms from an hayekian perspective
The study of institutional arrangements covers the branch of economics that deals with
the
emergence of a social order: economic agents recognizes patterns of behaviour that are familiar to
them and that they stored in their memory. These patterns of behaviour crystallize in rules of
18
Hayek, F.A. (1973) Law Legislation and Liberty, Vol. 1, Chicago, University of Chicago Press, page 106.
UCLA Oral History Program, page 144
20 UCLA Oral History Program, page 145-146
19
21
Loasby, B. (2007) "Uncertainty, intelligence and imagination: George Shackle's guide to human progress" in
Hodgson, G. (ed.) The Evolution of Economic Institutions, Edward Elgar Cheltenham UK, page 195
6
conduct and finally social norms that are generally accepted and shared. In Hayek’s point of view,
we can have different kinds of rules, each of which, by the way, has been evolved and has been
selected because they allow a social order to come into existence. Rules can be interpreted as
adaptations that are not deliberately chosen by individuals. This is the reason why each agent is not
aware about why he is following a rule or why he can recognize certain specific characteristics as
part of an order: the complexity of the order that rule-following behaviour can bring about “is not
limited to what a human mind can master.” But it is composed by purely abstract relations which
we can only mentally reconstruct: they will be “not intuitively perceivable and not recognizable
except on the basis of a theory accounting for their character.”22 Norm-following is similar to
bicycling or other motor activities that are automatic in their performance, but unlike them, normfollowing behaviour is related to a process of skill formations that is triggered by social learning:
we learn social skills “gradually and implicitly” by a process of “observations and repeated
interactions” that bring about inferences about the fact that certain social situations are similar and
can be clustered together in that they entail specific ways of relating with other people.”23
Regarding the relationship between establishment of rules and unconscious knowledge, social
learning pays a fundamental role even in Hayek’s theory of selection of a particular rule of
behaviour: “Men can learn from each other such, often highly abstract, rules of conduct by example
and imitation (or “by analogy”), although neither those who set the examples nor those who learn
from them may be consciously aware of the existence of the rules which they nevertheless strictly
observe. This is a problem most familiar to us in the learning of language who are able to produce
correctly most complicated expressions they have never heard before; but it occurs also in such
fields as manners, morals and law, and in most skills where we are guided by rules which we know
how to follow but are unable to state. The important point is that every man growing up in a given
culture will find in himself rules, or may discover that he acts in accordance with rules- and will
similarly recognize the actions of others as conforming or not conforming to various rules. This is,
of course, not proof that they are a permanent or unalterable part of a cultural heritage which is
likely to be fairly constant, especially so long as they are not articulated in words and therefore also
are not discussed or consciously examined.”24 Agents,
therefore,
in
Hayek’s
view,
behave
accordingly different type of rules, among which we can find: rules that are the product of the
environment in which individuals live; rules that individuals will follow spontaneously because
they are part of their common cultural heritage; normative rules: individuals ought to obey them,
even if they would like to disregard them, because “the overall order to which the success of their
22
Hayek, F.A. (1973) Law Legislation and Liberty, Vol. 1, Chicago, University of Chicago Press, page 39
Bicchieri, C. (2006) The Grammar of Society: The Nature and Dynamics of Social Norms, Cambridge University
Press, page 91
24 Hayek, F.A. (1973) Law Legislation and Liberty, Vol. 1, Chicago, University of Chicago Press, page 19
24 Hayek, F.A. (1973) Law Legislation and Liberty, Vol. 1, Chicago, University of Chicago Press, page 45
23
7
actions depends will arise only if these rules are generally followed (...) For the resulting order to
be beneficial people must also observe some conventional rules, that is, rules which do not simply
follow from their desire and their insight into relation of cause and effect, but which are normative
and tell them what they ought to or ought not to do.”25 Finally, we have the rule of law, that is an
enforcement mechanism and it emerges from the judicial process and “it will consist of rules
regulating the conduct of persons towards others, applicable to an unknown number of future
instances and containing prohibitions delimiting the boundary of the protected domain of each
person (or organized group of persons). Every rule of this kind will in intention be perpetual,
though subject to revision in the light of better insight into its interaction with other rules; and it
will be valid only as part of a system of mutually modifying rules. 26 An important insight in this
line of research about rule-following behaviour is given in “Studies in Philosophy, Politics and
Economics.”27 Hayek understands the importance of cultural evolution of a rule of conduct both
from an individual and a group point of view: “The genetic- and in a great measure also the
cultural- transmission of rules of conduct takes place from individual to individual, while what may
be called the natural selection of rules will operate on the basis of the greater or lesser efficiency of
the resulting order of the group.”28 When a spontaneous change will take place inside the working
of a rule of conduct of individuals, this means that this spontaneous change “may enable the group
to persist in circumstances which, without such a change, would have led to its destruction.”29
Thus, a rule describes “a regularity of the conduct of individuals”, regularity that may change
according to environmental needs and adaptations. “Norms are thus an adaptation to a factual
regularity on which we depend but which we know only partially and on which we can count only
if we observe those norms.”30
The mechanism by which an individual obeys to a rule is “irrespective of whether such
a rule is known to the individuals in only other sense than that they normally act in accordance with
it.”31 In his works Hayek emphasizes the tacit component of a rule since the subject is not totally
aware of using it. An agent can activate a mechanism of pattern recognition of an action and thus
she imitates the pattern she recognizes “as being of a known kind, of a kind, however, which we are
able to describe only by stating the meaning which these actions have to us and not by pointing out
the elements from which we recognize this meaning.”32 In particular a rule is presented as “a form
of imperative or norm that describes human interactions in complex social systems and that takes
25
Hayek, F.A. (1973) Law Legislation and Liberty, Vol. 1, Chicago, University of Chicago Press, page 45
Hayek, F.A. (1973) Law Legislation and Liberty, Vol. 1, Chicago, University of Chicago Press, page 122
27 Hayek, F.A. (1962) Studies in Philosophy, Politics and Economics, London: Routledge & Kegan Paul
28 Hayek, F.A. (1962) Studies in Philosophy, Politics and Economics, London: Routledge & Kegan Paul, page 67
29 Hayek, F.A. (1962) Studies in Philosophy, Politics and Economics, London: Routledge & Kegan Paul, page 71
30 Hayek, F.A. (1962) Studies in Philosophy, Politics and Economics, London: Routledge & Kegan Paul, page 80
31 Hayek, F.A. (1962) Studies in Philosophy, Politics and Economics, London: Routledge & Kegan Paul, page 67
32 Hayek, F.A. (1962) Studies in Philosophy, Politics and Economics, London: Routledge & Kegan Paul, page 48
26
8
the form of “If A then do B”. When rules are unconscious are more generally described as
“customs” or “habits.” The tacit component of a norm is justified by the cognitive limits of human
rationality33, that cannot determine the validity of an a priori value scale in which the agent can
understand some reference points always admissible. “In addition, rules were usually neither
consciously adopted, nor adopted after a rational process of assessment of their consequences,
simply because their wider effects were not then (nor are even today) well understood.” 34 We can
better examine the role of reason in human thought, reporting Hayek's explanation, by which the
lecture of the scholastic maxim “ratio non est judex, sed instrumentum”, later followed by the
Scottish Enlightenment, still holds: values are the ends of human reason and which reason serves,
but which reason cannot determine. “This does not mean that reason has no function in deciding in
conflicts of values; but nothing shows better the limited role of reason in this connection than a
closer analysis of how we decide such conflicts. Reason can only help us to see what are the
alternatives before us, which are the values which are in conflict, or which of them are true ultimate
values and which are, as is often the case, only mediate values which derive their importance from
serving other values. Once this task is accomplished, however, reason cannot help us further. It
must accept as given the values which is made to serve.”35
2.2 Natural Selection, Learning, and Social Norms
Hayek, in particular, finds an unexpected support in the new science of social
anthropology because “what has been regarded as the invention of reason was in fact the outcome
of a process of evolution and selection very similar to that which we find in the biological field.
The social anthropologist merely continue work which Mendeville, Hume and its successors among
the Scottish philosophers had commenced, but which was largely forgotten when their later
followers more and more confined themselves into the narrow field of economics.”36 Once again
the importance of a multidisciplinary perspective- and not only of economics- in the study of social
norms is stressed, and the role of cultural evolution remarked. The evolution of norms and cultural
practices is one of the fields upon which selection acts: biology, psychology and anthropology
should be taken into account in studying economic phenomena that deals with the emergence and
evolution of norms and, in particular, the Darwinian theory of natural selection plays an important
role.
This last one is underpinned on three fundamental elements: variation, inheritance and
selection. Variation means that not all organisms in a population are successful in producing
33
Rizzello, S. (1999). The Economics of the Mind, Edward Elgar, Aldershot
Caldwell, B. (2000) “The Emergence of Hayek's Ideas of Cultural Evolution”, Review of Austrian Economics, 13,
page 6
35 Hayek, F.A. (1962) Studies in Philosophy, Politics and Economics, London: Routledge & Kegan Paul, page 87
36 Hayek, F.A. (1962) Studies in Philosophy, Politics and Economics, London: Routledge & Kegan Paul, page 86
34
9
offspring and thus the phenotype can change according to environmental responses: each
phenotype is more adapted to a particular niche that requires some specific features linked with that
phenotype. Then “the traits or features that are responsible for organisms' reproductive success or
failure must be inheritable.”37 Finally, natural selection selects the phenotypes of organisms that
succeed in leaving more offspring than others increasing the relative frequency of reproduction of
the genotypes. Moreover, when an individual leaves less offspring than others, “the success of its
genotype decreases.”38 Therefore, natural selection is the mechanism that produce and allow
adaptation: without it, “biological evolution would produce randomly without an adaptive
meaning.”39 It is important to notice that Darwinian natural selection is underpinned on individual
stasis: it is not possible that new variety of genotype will be created by itself, natural selection
always works on pre-established variety on genotypes. This means that an alteration in phenotypes
cannot produce an alteration in genotypes. This is also the main difference between Darwinian and
Lamarckian natural selection, the latter being underpinned on individual development and
continuous change. Cultural evolution, is, therefore, Lamarckian, because it is based on the
inheritance of acquired characters. This means that, when mutation happens in a cultural trait, that
is when there is a difference between the transmitted behaviour and the original one, this mutated
cultural trait can be inherited by the member of the same species by a mechanism of imitation and
social learning. But even if this process can be defined as “Lamarkian”, this concept can be simply
a tautological one: “Lamarkianism” simply refers to the process of cultural, contra posed to genetic
and biological, evolution. “The Lamarckian model is inapplicable to inheritance and variation
(whether somatic or behavioural) mediated by the genetic mechanism, but it seems to be broadly
descriptive of cultural evolution in general, and of economic responses in particular.” 40 In this case,
among evolutionary theorists, we have different positions about the role of natural selection:
Pinker41 argues that natural selection cannot work on cultural transmitted traits because a
phenotypic trait, as a cultural trait is, is an extremely temporary manifestation and does not lead to
cumulative change. Boyd and Richerson42 , however, deem that natural selection should be always
the ultimate explanation, even in cultural inheritance.
By cultural trait we refer to any aspect of “thought, speech, action (meaning behavior),
and artifacts” which can be learned and transmitted.”43 In order to produce cumulative cultural
change, observational learning is necessary, this means that only observational learning leads to
37
Vromen, J. J. (1995). Economic Evolution; London: Routledge, page 92
Vromen, J. J. (1995). Economic Evolution; London: Routledge, page 92
39Cavalli-Sforza, L.L., & Feldman, M.W. (1981) Cultural Transmission and Evolution: A Quantitative Aprroach.
Princeton University Press
40 Hirshleifer, J. (1977). “Economics from a biological viewpoint”. Journal of Law and Economics 20, 1-52
41 Pinker, S. (1997). How The Mind Works, New York, Northon
42 Boyd, R. & Richerson, P; (1985). Culture and The Evolutionary Process, ChicagoUniversity Press, Chicago. Boyd,
R. & Richerson, P; (2005) Not by genes alone: How culture transformed human evolution, Chicago: University of
Chicago Press.
43 Cavalli-Sforza, L.L., & Feldman, M.W. (1981) Cultural Transmission and Evolution: A Quantitative Aprroach
38
10
cumulative cultural change.44 Experimental evidence taken from laboratory in which primates ( i.e.
cebus monkeys) are studied, shows that this specie does not use observational learning. “This
suggests that observational learning is not simply a by product of intelligence and the opportunity to
observe co-specifics. Rather, observational learning seems to require special psychological
mechanisms.”45 This conclusion suggests, in turn, that the psychological mechanisms that enable
humans to learn by observation are “adaptations have been shaped by natural selection because
culture is beneficial.”46 However, even if imitation, teaching and social learning are indispensable
machineries because they let you acquire a behaviour without learning it from scratch, culture in
itself cannot be considered to be beneficial if its only beneficial effect is to avoid past errors and
reduce learning costs: an individual can also learn the wrong behaviour. Imitation can be beneficial
and increases fitness only if it leads to selective learning: an imitator, instead of picking at random a
behaviour to imitate, must pick it selectively: “to avoid errors, individuals adopt a particular
behaviour only if it appears sufficiently better than its alternatives.” 47 Of course, being selective
also means increasing the indecisive trials, and therefore, imitate a random chosen individual. But,
once that the right behaviour is picked, imitation can be beneficial allowing selective learning to
cumulate over next generations. Cumulative cultural learning is the specific character that makes
human learning unique, even if it has been demonstrated that some birds' song and some forms of
learning in chimpanzees also are based on a particular kind of cumulative learning. Therefore,
understanding the psychological machineries that enhance human imitation and the mechanism by
which natural selection acts on them, is a key factor.
There is clearly a strong analogy between human learning at the individual level and
natural selection from a biological point of view.48 Both human learning and evolution are
“selective”, meaning that they are governed by the elimination of errors an the generation of new
trials, but at the same time both of them are blind, since past successes do not assure the same result
in future performance. A learning mechanism that finally leads to a best response does not hold:
errors are eliminated, but this does not give any clue on how the evolution could proceed in the
future, rather than that making the same mistake again is better avoided. This kind of reasoning is
also in line with Hayek's concepts of selection of a rule and progress: we never act, and could never
act, in full consideration of all the facts of a particular situation "but we have to proceed on the basis
Princeton University Press, page 10
44 Tomasello, M., Kruger, A. C., & Ratner, H. H. (1993). “Cultural Learning”. Behavior and Brain Sciences. 16, 495–
552.Boyd, R, & Richerson, P.; (1996). “Why culture is common but cultural evolution is rare”, Proceedings of the
British Academy, 88, pages 73-93
45 Bandura, A. (1986). Social Foundations of Thought and Action: A Social Cognitive Theory, Englewood Cliffs, NJ:
Prentice Hall.
46 Boyd, R, & Richerson, P.; (1996). “Why culture is common but cultural evolution is rare”, Proceedings of the British
Academy, 88, page 83
47 Boyd, R, & Richerson, P.; (1995). “Why does culture increase human adaptability?” Ethology and Sociobiology 16,
page 130
48 Simon, H. (1983). Reason in Human Affairs, Stanford: Stanford University Press
11
of some kind of selective knowledge, and the real issue is on which principle of selection we ought
to rely. There are reasons why rule-guided selectivity can be more successful than case-by-case
rationality.”49 But new errors could occur and the mechanism will repeat again. Thus “just as in the
biological theory of evolution the mechanism of natural selection weeds out poorly adapted
variants, so in human thinking the adapted process rejects ideas other than those that contribute to
solving the problem that is being addressed.”50 In both cases a “backward looking”51 procedure
occurs that makes rule-governed behaviour not opposed to creative thinking and intentionality.
At the same time, in Hayek's view, progress has not a teleological meaning, it does not
constrain the institutional setting towards a better arrangement, but “It would be more correct to
think of progress as a process of formation and modification of the human intellect, a process of
adaptation and learning in which not only the possibilities known to us but also our values and
desires continually change. As progress consists in the discovery of the not yet know, its
consequences must be unpredictable. It always leads into the unknown, and the most we can expect
is to gain an understanding of the kind of forces that bring it about.” 52 We have always to strive for
our institutions, but "we can probably at no point be certain that we have already found the best
arrangements of institutions."53 This idea is common among biologists: progress does not mean the
growing accumulation of better further adaptations, but rather “the substitution of one adaptation
for another.”54 Evolution must be seen as a by- product of the maintenance of an adaptation, but
between the adaptation and the necessity issue there is no mutual implication, both at an individual
and a population level: the fact that a psychological or ecological trait can develop as an adaptation
does not mean that it was necessary for the survival of the species; and the opposite argument also
holds: the fact that a certain adaptation is necessary for the survival of the species, does not mean
that it will be selected and that it will evolve.
3. Hayek’s Idea of Cultural Evolution
In Hayek’s view, therefore, spontaneous social orders are the results of a process of
adaptations to particular environmental conditions through a mechanism of rule-following
behaviour performed automatically and in a way that individuals cannot state because the rules are
abstract, they have a wide range of applications and generality, and they are tacit and inarticulate.
Therefore, perception and pattern-recognition play an important role in his model of learning, which
49
Hayek, F.A. (1973) Law Legislation and Liberty, Vol. 1, Chicago, University of Chicago Press, page 30
Simon, H. (1983). Reason in Human Affairs, Stanford: Stanford University Press, page 40
51 Vromen, J. J. (1995). Economic Evolution; London: Routledge
52 Hayek, F.A. (1960) The Constitution of Liberty, Chicago, University of Chicago Press, page 60
53 Hayek, F.A. (1960) The Constitution of Liberty, Chicago, University of Chicago Press, page 231
54 Williams, G.C. (1966) Adaptation and Natural Selection. A Critique of some Current Evolutionary Thought.
Princeton, Princeton University Press, page 53
50
12
can be represented by three different levels: a biological level that is characterized by the individual
genetical heritage, an individual level, which is mainly represented by a process of experimentation
and trial error learning, and a social level, that is a mechanism of cultural transmission through
which rules are passed on using societal institutions. “An example of the last is the ability of
markets to utilize dispersed knowledge, and to permit the discovery and transmission of new
knowledge, this being the paradigmatic case of how institutions promote the expansion of
knowledge.”55 Within this process of cultural evolution, some rules and institutions may emerge
that are not the product of self-interested calculation, or, to speak more exactly, they can be
interpreted as positive externalities: group- beneficial institutions may emerge while individuals are
pursuing their own interests. These institutions spontaneously emerge and they are self-enforcing
patterns of behaviour, they are what game theorists would define as “coordination games.”
56
In
Hayek’s theory of cultural evolution, he uses the issue of group selection, that we may better define
as cultural group selection because it is natural selection that acts on groups “to discuss the
formation of institutions that benefit the group but whose formation cannot be attributed to the
actions of self-interested individuals.”57 Following Hayek words: “The constructivistic theories of
utilitarianism that derive the now valid rules from their serving individual pleasure are therefore
completely mistaken. The rules which contemporary man has learnt to obey have indeed made
possible an immense proliferation of the human race. I am not so certain that this has also increased
the pleasure of the several individuals.”58
Hayek is interested in explaining how rules and practices that do not make sense given
the prisoner dilemma type situations, nevertheless come into being, that is why institutions that we
don’t like and that are not the result of self-seeking performance, exist and persist. Or, the other
way round, why beneficial norms can spread leading to a social order through a process of cultural
group selection that consists mainly in the spread of those rules that conducted “to a more effective
order of actions” making the group who adopted them “prevail over other groups with a less
effective order. The rules that will spread will be those governing the practices or customs existing
in different groups which make some groups stronger than others. And certain rules will
predominate by more successfully guiding expectations in relation to other persons who act
independently. Indeed, the superiority of certain rules will become evident largely in the fact that
they will create an effective order not only within a closed group but also between people who meet
accidentally and do not know each other personally. They will thus, unlike commands, create an
Caldwell, B. (2002) “ Hayek and Cultural Evolution“, in Maki, U. (Ed.) Facts and Fictions in Economics: Models,
Realism and Social Constructions, Cambridge University Press, Cambridge, UK, page 294
56 Caldwell, B. (2002) “ Hayek and Cultural Evolution“, in Maki, U. (Ed.) Facts and Fictions in Economics: Models,
Realism and Social Constructions, Cambridge University Press, Cambridge, UK
57 Caldwell, B. (2002) “ Hayek and Cultural Evolution“, in Maki, U. (Ed.) Facts and Fictions in Economics: Models,
Realism and Social Constructions, Cambridge University Press, Cambridge, UK, page 295
58 Hayek, F.A. (1979) Law Legislation and Liberty, Vol. 3, Chicago, University of Chicago Press, page 163
55
13
order even among people who do not pursue a common purpose.”59 Hayek’s view of order is not an
authoritarian and hierarchical one, but it is a self-enforced order that spontaneously emerged
because agents follow rules that have been shown to be satisfying in certain conditions. A rule can
spread if it is beneficial for the group the individual belongs to, this means that Hayek believes
there are levels of selection that works upper the individual level. This statement makes sense if we
examine the last chapter of the third book of Law, Legislation and Liberty, in which Hayek
explains “the error of sociobiology” that, from his own point of view, consists in being committed
to genetic determinism, since, in the opinion of sociobiologists- best represented by Oliver Wilsoneach kind of human value arises from genetic heritage or from rational thought, but, in this way, a
process of cultural evolution that can arise spontaneously is forgotten. “What is so surprising about
this view occurring so frequently among biologists, is that one might rather have expected that they
would be sympathetic to that analogous yet in important respects different process of selective
evolution to which is due the formation of complex cultural structures.”60 Gil-White61 provides a
clear explanation about how cultural transmission works and which are the differences between
cultural and genetic transmission: cultural inheritance doesn’t require neither a unit of selection,
like in biological evolution, nor a replicator dynamics – like exact imitation- as a copying
mechanism. Cultural selection, if we want to define natural selection in the domain of cultural and
human social activities, as opposed to natural selection at the genetic level, behaves in ways that
differs in a significant way from biological natural selection, and it is underpinned on a process of
inference and spread of a behaviour by a mechanism of analogy, that makes the behaviour spread
even in the case it is not successful. This is exactly the kind of mechanism that Hayek has in mind.
In the same way, Hayek’s “epistemological pessimism”- as Caldwell defines it- doesn’t
assure that a particular institution can be selected again in new situation. Each institution, each
norm and pattern of behaviour, is an adaptation to specific environmental situations. Moreover, the
fact that a norm has been selected cannot guarantee that it is the best one or that it is good and not
harmful either. With respect to this issue, Caldwell believes that Hayek doesn’t commit the
naturalistic fallacy and therefore he is not a functionalist: it would be wrong to conclude that
“whatever rules have evolved are always and necessarily conducive to the survival and increase of
populations.”62 and therefore his analysis cannot state the superiority of market institutions, but it
can only help us to understand how such an unpopular, but productive, set of institutions might
emerge and survive. Only because something survives, this does not prove that it is necessarily
59
Hayek, F.A. (1973) Law Legislation and Liberty, Vol. 1, Chicago, University of Chicago Press, page 99
Hayek, F.A. (1979) Law Legislation and Liberty, Vol. 3, Chicago, University of Chicago Press, page 154
61 Gil-While, F.J., (2005). “Common Misunderstandings of Memes (and Genes): The Promises and Analysis of the
Genetic Analogy to Cultural Transmission Processes” in Hurley, S. and Chater, N. (ed.) Perspectives on Imitation: from
Neurosciences to Social Sciences, vol. 2, The MIT Press, Cambridge, MA and London, UK
62 Hayek, F.A. (1988) The Fatal Conceit: the Errors of Socialim, Chicago, University of Chicago Press, quoted in
Caldwell, B. (2002) “ Hayek and Cultural Evolution“, in Maki, U. (Ed.) Facts and Fictions in Economics: Models,
Realism and Social Constructions, Cambridge University Press, Cambridge, UK
60
14
goods. “It would however be wrong to conclude, strictly from such evolutionary premises, that
whatever rules have evolved are always or necessarily conducive to the survival and increase of the
populations following them. We need to show, with the help of economic analysis, how rules that
emerge spontaneously tend to promote human survival. Recognising that rules generally tend to be
selected, via competition, on the basis of their human survival-value certainly does not protect those
rules from critical scrutiny.”63 Therefore, selection is not the selection of the optimum and even the
market cannot be defined as the optimum social order, but, given the limits of human rationality and
the dispersal and idiosyncratic dimension of knowledge, the market is, in Hayek’s opinion, the only
kind of grown order achievable in order to posses more knowledge that single agents couldn’t
possess by their own. Thus, following Caldwell et al.64, we can state that Hayek did not commit the
naturalistic fallacy because saying that a certain kind of behavioural regularity has been selected
and therefore it has been evolved, does not say anything about an hypothetical degree of optimality
of this behavioural regularity. Hayek himself stresses the point that there is no mechanism that can
guarantee that the institution that has been selected is the optimum that would be possible: “The
growth of knowledge and the growth of civilization are the same only if we interpret knowledge to
include all the human adaptations to environment in which past experience has been incorporated.
Not all knowledge in this sense is part of our intellect, nor is our intellect the whole of our
knowledge. Our habits and skills, our emotional attitudes, our tools and our institutions- all are in
these sense adaptations to past experience which have grown up by selective elimination of less
suitable conduct. They are as much an indispensable foundation of successful action as is our
conscious knowledge. Not all these non-rational factors underlying our action are always
conductive to success. Some may be retained long after they have outlived their usefulness and even
when they have become more an obstacle than an help.”65
Taking into consideration this background, cultural transmission becomes the leading
mechanism that can make agents achieve a social order without being constrained by self-interested
behaviour. More precisely, cultural transmission is a particular kind of social learning that makes
norms, practices and skills pass on through generations saving the cost of individual learning, that
instead consists in inventing a patterns of behaviour from scratch. “It is not society with a given
structure which creates the rules appropriate to it, but the rules which have been practiced by a few
and then imitated by many which created a social order of a particular kind. Tradition is not
something constant but the product of a process of selection guided not by reason but by success. It
changes but can rarely be deliberately changed. Cultural selection is not a rational process; it is not
guided by but it creates reason (...) We do not really understand how (our whole moral system)
63
Hayek, F.A. (1988) The Fatal Conceit: the Errors of Socialim, Chicago, University of Chicago Press, page 20
Caldwell, B., & Reiss, J. (2006). “Notes and Commentary: Hayek, Logic and Naturalistic Fallacy”, Journal of The
History of Economic Thought, 28 (3), 359-370
65 Hayek, F.A. (1960) The Constitution of Liberty, Chicago, University of Chicago Press, page 26
64
15
maintains the order of actions on which the co-ordination of the activities of many millions
depend.”66 This does not mean that in Hayek’s theory of cultural evolution there is no place for
novelty: creative and innovative power can spread from the individuals themselves and, in
particular, neo-institutional and neo-Austrian economics deals with this kind of explanations,
underling the importance of the individual action and the self-determination of autonomous agents,
and accounting for the emergence of novelty as the curiosity and desire to improve one’s own
performance.67
4. Concluding Remarks
In the general background presented in this paper, the importance of rule-following
behaviour and cultural evolution is remarked. Following abstract rules do not imply the awareness
of the individual who abide by the rules. Studying the processes of knowledge coordination and
social norms formation should be, in Hayeks’ view, the main focus of economic research and, in
doing this, a multidisciplinary perspective is favoured. In particular, in the present paper, I argued
that two different branches of research in the social sciences should be taken into consideration in
dealing with this kind of problems: the vast production of Hayek’s writings that is related to his
theory of knowledge, and evolutionary theories in biological anthropology. They are two fields of
research that have been proceeding on different tracks without communication to each others so far,
but a great deal of improvement can come from a mutual intersection from the two. Knowing
evolutionary theories deeper can better provide an interpretation of Hayek’s concept of cultural
evolution, and the other way round, integrating Hayek’s epistemology in models of evolutionary
and biological anthropology can bring about a new and fertile line of research.
66
Hayek, F.A. (1979) Law Legislation and Liberty, Vol. 3, Chicago, University of Chicago Press, page 166
Vromen, J.J. (2001). “The Human Agent in Evolutionary Economics“ in Laurent, J. & Nightingale, J. (Ed)
Darwinism and Evolutionary Economics, Cheltenham, UK, Edward Elgar
67
16
Bibliographical References
Bandura, A. (1986). Social Foundations of Thought and Action: A Social Cognitive Theory,
Englewood Cliffs, NJ: Prentice Hall.
Bicchieri, C. (2006) The Grammar of Society: The Nature and Dynamics of Social Norms,
Cambridge University Press
Boyd, R. & Richerson, P; (1985). Culture and The Evolutionary Process, ChicagoUniversity Press,
Chicago
Boyd, R, & Richerson, P.; (1995). “Why does culture increase human adaptability?” Ethology and
Sociobiology 16, pages 125-143
Boyd, R, & Richerson, P.; (1996). “Why culture is common but cultural evolution is rare”,
Proceedings of the British Academy, 88, pages 73-93
Boyd, R. & Richerson, P; (2005) Not by genes alone: How culture transformed human evolution,
Chicago: University of Chicago Press.
Caldwell, B. (2000) “The Emergence of Hayek's Ideas of Cultural Evolution”, Review of Austrian
Economics, 13, 5-22
Caldwell, B. (2002) “ Hayek and Cultural Evolution“, in Maki, U. (Ed.) Facts and Fictions in
Economics: Models, Realism and Social Constructions, Cambridge University Press, Cambridge,
17
UK.
Caldwell, B., & Reiss, J. (2006). “Notes and Commentary: Hayek, Logic and Naturalistic Fallacy”,
Journal of The History of Economic Thought, 28 (3), 359-370
Cavalli-Sforza, L.L., & Feldman, M.W. (1981) Cultural Transmission and Evolution: A
Quantitative Aprroach. Princeton University Press
Gil-While, F.J., (2005). “Common Misunderstandings of Memes (and Genes): The Promises and
Analysis of the Genetic Analogy to Cultural Transmission Processes” in Hurley, S. and Chater,
N. (ed.) Perspectives on Imitation: from Neurosciences to Social Sciences, vol. 2, The MIT
Press, Cambridge, MA and London, UK
Hayek, F.A. (1945.) “The Use of Knowledge in Society”, The American Economic Review, 35, (4),
519-530.
Hayek, F.A. (1948). Individualism and Economic Order, Chicago, University of Chicago Press.
Hayek, F.A. (1960) The Constitution of Liberty, Chicago, University of Chicago Press
Hayek, F.A. (1962) Studies in Philosophy, Politics and Economics, London: Routledge & Kegan
Paul
Hayek, F.A; (1973, 1976, 1979) Law Legislation and Liberty, 3 Vols, Chicago, University of
Chicago Press
Hayek, F.A. (1983) Nobel Prize-winning economist. Transcript from an oral history interview
18
conducted in 1978 under the auspiecies of the Oral History Program, University Library, UCLA,
Copyright, Regents of the University of California
Hayek, F.A. (1988) The Fatal Conceit: the Errors of Socialim, Chicago, University of Chicago
Press
Hirshleifer, J. (1977). “Economics from a biological viewpoint”. Journal of Law and Economics 20,
1-52
Loasby, B. (2007) "Uncertainty, intelligence and imagination: George Shackle's guide to human
progress" in Hodgson, G. (ed.) The Evolution of Economic Institutions, Edward Elgar Cheltenham
UK
North, D.C. (1990). Institutions, institutional change and economic performance, Cambridge UK
and New York: Cambridge University Press.
Pinker, S. (1997). How The Mind Works, New York, Northon
Rizzello, S. (1999). The Economics of the Mind, Edward Elgar, Aldershot.
Sen, A.K. (1977). “Rational Fools: A critique of the behavioural foundations of economic theory”.
Philosophy and Public Affairs, 6, (4), 317-344
Simon, H. (1959). “Theories of Decision Making in Economics and Behavioral Science” The
American Economic Review, 49 (3), 253-283
Simon, H. (1983). Reason in Human Affairs, Stanford: Stanford University Press
19
Vromen, J. J. (1995). Economic Evolution; London: Routledge
Vromen, J.J. (2001). “The Human Agent in Evolutionary Economics“ in Laurent, J. & Nightingale,
J. (Ed) Darwinism and Evolutionary Economics, Cheltenham, UK, Edward Elgar
Tomasello, M., Kruger, A. C., & Ratner, H. H. (1993). “Cultural Learning”. Behavior and Brain
Sciences. 16, 495–552.
Williams, G.C. (1966) Adaptation and Natural Selection. A Critique of some Current Evolutionary
Thought. Princeton, Princeton University Press.
20