This edition of Hayek's classic work, "The Road to Serfdom," is edited by my former UNC-Greensboro colleague, Dr. Bruce Caldwell. Bruce's introduction to Hayek's work (more than 30 pages long) is worth the price of the book. Nobody knows Hayek's work better than Bruce Caldwell. "The Road to Serfdom" was written by Nobel-Prize Winning Economist F.A. Hayek during World War II. Hayek's description on "the road" is as relevant today as it was in the early 1940s. Be sure to get this "Bruce Caldwell edition."

Michael Beitler, Ph.D.
Host of "Free Markets With Dr. Mike Beitler"
Author of "Rational Individualism" Rational Individualism: A Moral Argument for Limited Government & Capitalism

You are missing the point MacKenzie. The evolution of the Capitalist mode of production spans centuries and has been solidified through both war and peace, failure and success. On the other hand, The Soviet Union broke any institutional continuity. Let me clarify what this means. Yes, law would be an essential part of any type of Socialist order as it is THE essential part of the Capitalist counterpart. Yes, a Socialist order would benefit from the "pat my back I will pat yours" that occurred between the Princes and Kings (the state) and the merchants (the Capitalists) when Capitalism was budding. And so forth. You seem to believe that things are the way they are magically, and forget that the building of the foundations of systems which you now take for granted claimed more lives than any Socialist experiment. It is hard to see how any break in continuity, in ANY system, carrying the goals of progress can instantaneously succeed without major external and internal pressures and problems.

"So-called market socialism does in fact rely on politicized central planning in the critical area of planning future investment. It is therefore subject to the same kind of long run inefficiency as Soviet style Socialism."

Excuse my language, but what the hell are you talking about? Where does this inefficiency you speak of come from? There is a litany of work that runs counter to this conclusion. The only argument against this, and Hayek's as well it should be noted, is on the political side..not the economic.

To conclude, this book attempts to show why the Communist revolutionaries failed (or would fail). First off, however, I believe it is important to note that the failure of these experiments by no means legitimizes Hayek's argument, as some respondents of this thread have taken a liking to believe. If I say the Sun will rise tomorrow (or even something less definite) because Apollo will bring it on his Chariot and the Sun does in fact rise tomorrow...you get the idea. Second, Hayek's criticism of Socialism in this work is more in the realm of political philosophy, I do not understand why many respondents are talking about the economic inefficiencies of the Classical Socialists in regards to this text. This work is a political and philosophical one, and does bring up some interesting ideas. Personally, I have gotten past these ideas and have found them to be less explanatory than I at first thought. However, if you have not yet read this...whatever alignment you may be...you should definitely pick it up due to the impact it has had on contemporary thought.

Review: Hayek's "Road to Serfdom" (1944) the philosophical basis of libertarian economics and Reagonomics

Why read the book?

I've been listening a lot of libertarian economists lately (mostly through the podcast EconTalk http://www.econtalk.org) who often refer to Friedrich Hayek's "The Road to Serfdom" as an "inspirational" book. The Road to Serfdom is probably one the most influential books on neo-conservatism and libertarianism. This book has significantly shaped Milton Friedman's ideas and the political ideologies of 'Reagonomics' and 'Thatcherism'. Thomas Sowell of the Hoover Institute has called Friedrich von Hayek "the central pioneering figure in changing the course of thought in the twentieth century." The National Review ranked the book #4 on its List of the 100 Best Non-Fiction Books of the Century (http://www.nationalreview.com/100best/100_books.html) So I decided to read The Road to Serfdom Fiftieth Anniversary Edition as it was available for free in the UCLA library

Overview

The "Road to Serfdom" is a polemic against socialism. Hayek's central thesis is that all forms of collectivism lead logically and inevitably to tyranny. He makes the assertion that individual decisions are better than collective decisions. Hayek was convinced that if every individual freely pursued his own personal objectives, the outcome would be the best possible for society as a whole. The basis of the decision-making is the notion of "competition." He believed that "through competition, not through agreement, we gradually increase our efficiency."

"It is necessary in the first instance that the parties in the market should be free to sell and buy at any price at which they can find a partner to the transaction, and that anybody should be free to produce, sell and buy anything that may be produced or sold at all. And it is essential that the entry into the different trades should be open to all on equal terms and the law should not tolerate any attempts by individuals or groups to restrict this entry by open or concealed force."

Ironically (and illogically) he also states that in order for individual decisions to work we must make collective decisions in the form of rules of law in order for "free markets" to work:

"The functioning of competition not only requires adequate organization of certain institutions like money, markets, and channels of information--some of which can never be adequately provided by private enterprise--but it depends, above all, on the existence of an appropriate legal system, a legal system designed both to preserve competition and to make it operate as beneficially as possible."


Hayek further believes that government regulation is perfectly acceptable in a free market system:

"To prohibit the use of certain poisonous substances or to require special precautions in their use, to limit working hours or to require certain sanitary arrangements is fully compatible with the preservation of competition. Nor is the preservation of competition incompatible with an extensive system of social services--so long as the organization of these services is not designed in such a way as to make competition ineffective over wide fields."

Hayek also seems to rant against ideology and laissez-faire capitalism in spite of the book entirely consisting of ideology and simple minded ideas: "probably nothing has done so much harm to the liberal cause as the wooden insistence of some liberals on certain rules of thumb, above all the principle of laissez-faire capitalism".

Conclusion

In conclusion, Hayek makes a philosophical argument that a society should be run based on individual competition but states that we can only do this by setting up a framework based on collective agreement of the rules of law. There is no acknowledgment that if some decisions must to be made through collective agreement that there can be other decisions that are better made through collective decisions or a mix of both?

The discussion focuses on a normative belief that markets are efficient without discussing whether they are desirable. There is no acknowledgment of the inherent non-equality of market-based decisions. Hayek was a student of Ludwig von Mises, another theorist widely admired by American libertarians. Mises argued that the market reflects the people's wishes better than the electoral system, because we vote only every few years but vote every day with our pocket. Of course, when every dollar represents a vote, the rich have far votes than the poor.

The fundamental problem with Hayek philosophy seems to be a blind belief in markets. Rather than looking which decisions are best approached with market based approaches and which are best approached with collective decisions he simply states an ideology that competition is better than agreement while stating that competition can't work unless there is some basic agreement.

One should note that this view is different and more extreme than Adam Smith. Adam Smith embraced competition and self-interest but with restraint, arguing in The Wealth of Nations (1776) that an individual "by pursuing his own interest frequently promotes that of the society more effectually than when he really intends to promote it." Stating that competition and self-interest are "frequently" desirable --not "always" or even "generally." In The Theory of Moral Sentiments (1759), Smith conceded that "the wise and virtuous man ... is willing that his own private interest should be sacrificed to the public interest." Smith understood that individual interests could sometimes conflict with the common good. Hayek rejected this kind of moderation.

It is clear that some decisions must be made collectively. Laws that are required for a "free market system" can only work if made collectively. Hayek proposes a philosophy that "through competition, not through agreement" that we have a "more efficient" society without acknowledging that we can't have fair competition without agreement. Clearly competition can be healthy and unhealthy. Clearly there must be some forms of collectivism to establish some basic rules in society. Simply labeling collectivism as "bad" and individual competition as good is far to simple mined for me to accept.

You are missing the point MacKenzie. The evolution of the Capitalist mode of production spans centuries and has been solidified through both war and peace, failure and success. On the other hand, The Soviet Union broke any institutional continuity. Let me clarify what this means. Yes, law would be an essential part of any type of Socialist order as it is THE essential part of the Capitalist counterpart. Yes, a Socialist order would benefit from the "pat my back I will pat yours" that occurred between the Princes and Kings (the state) and the merchants (the Capitalists) when Capitalism was budding. And so forth. You seem to believe that things are the way they are magically, and forget that the building of the foundations of systems which you now take for granted claimed more lives than any Socialist experiment. It is hard to see how any break in continuity, in ANY system, carrying the goals of progress can instantaneously succeed without major external and internal pressures and problems.

"So-called market socialism does in fact rely on politicized central planning in the critical area of planning future investment. It is therefore subject to the same kind of long run inefficiency as Soviet style Socialism."

Excuse my language, but what the hell are you talking about? Where does this inefficiency you speak of come from? There is a litany of work that runs counter to this conclusion. The only argument against this, and Hayek's as well it should be noted, is on the political side..not the economic.

To conclude, this book attempts to show why the Communist revolutionaries failed (or would fail). First off, however, I believe it is important to note that the failure of these experiments by no means legitimizes Hayek's argument, as some respondents of this thread have taken a liking to believe. If I say the Sun will rise tomorrow (or even something less definite) because Apollo will bring it on his Chariot and the Sun does in fact rise tomorrow...you get the idea. Second, Hayek's criticism of Socialism in this work is more in the realm of political philosophy, I do not understand why many respondents are talking about the economic inefficiencies of the Classical Socialists in regards to this text. This work is a political and philosophical one, and does bring up some interesting ideas. Personally, I have gotten past these ideas and have found them to be less explanatory than I at first thought. However, if you have not yet read this...whatever alignment you may be...you should definitely pick it up.

Great writer & book. Must read for anyone that desires to understand economics and politics.

This book is a classic and a mandatory read for anyone interested in the fundamental forces at work in an economy. In a sense it is just as much a book on sociological and psychological behavior in the marketplace as it is about economics, and it is not a tough, high esoteric read as many such books are. The reader should keep in mind as he goes through the book that Hayek was writing it for an English audience in the years immediately following WW II, but it is still applicable to an American audience of the 1940's and today. Make sure to read the prefaces and introductions to earlier publications of the book before reading the text itself.

This book by F.A. Hayek is eye-opening and terrifying in this age of Obama and Socialism (which is a code word for Marxism and Communism). In the book, you learn of the reasons for the failure of socialism and why it always fails and always will fail.

The book arrived almost immediately, in better shape than promised. Seller followed up to confirm receipt. I was very satisfied with this vendor and would recommend them without hesitation. MOM