Designing Men vs. Spontaneous Order

Dedicated to Tyrants of all persuasions

By David Henderson

"The man of system, on the contrary, is apt to be very wise in his own conceit; and is often so enamoured with the supposed beauty of his own ideal plan of government, that he cannot suffer the smallest deviation from any part of it. He goes on to establish it completely and in all its parts, without any regard either to the great interests, or to the strong prejudices which may oppose it. He seems to imagine that he can arrange the different members of a great society with as much ease as the hand arranges the different pieces upon a chess-board. He does not consider that the pieces upon the chess-board have no other principle of motion besides that which the hand impresses upon them; but that, in the great chess-board of human society, every single piece has a principle of motion of its own, altogether different from that which the legislature might choose to impress upon it. If those two principles coincide and act in the same direction, the game of human society will go on easily and harmoniously, and is very likely to be happy and successful. If they are opposite or different, the game will go on miserably, and the society must be at all times in the highest degree of disorder."

This is VI.II.42 from Adam Smith, The Theory of Moral Sentiments.

Why do I quote it? Because it's an answer to a commenter on some previous blog posts of mine. This commenter defended the existing laws that require people to spend substantial time as residents in a hospital before becoming doctors. I criticized those laws. The commenter, zdc, then wrote:

So, you think you can design an improved (not sure if this means in terms of outcomes or costs or what) system.

I answered that I don't think I can design an improved system. Why did he think that I thought I could? It's because he's stuck in the "man of system" or "design" paradigm. Over the years, various governments have designed a particular system. I criticize the idea that they get to design it. Then zdc assumes that means that I think I should be able to design it.

But I'm not a designer. I'm a person who believes in spontaneous order. That is, I think that people should be free to come up with other systems and I'm willing to predict that they will. As an economist, I could speculate about what they will come up with, but there's a good chance that my predictions would be wrong. Where zdc and I probably agree is that if I were to design such a system, it would be a disaster.

Fortunately, I don't need to design a system.

So what do I propose? Letting people come up with their own systems. And my prediction, which I'm fairly sure of, is that they would come up more than one.

Consider an example from outside medical care. Imagine that back in the 1960s, the government had given IBM a legal monopoly on computers. Imagine that some economist came along and said, "I think we shouldn't have a legal monopoly on computers." Then zdc's counterpart back then would likely have said, "Oh, yeah? Then tell me how you can make computers better." The economist would have had to admit that he couldn't. Then zdc's counterpart would likely have declared victory, confident that because the economist couldn't predict what kind of computers would be built in the absence of a legal monopoly, letting IBM have a legal monopoly on computers would clearly have been the right policy.