Competition as an Ambiguous Discoverty Procedure: A Reppraisal of F. A. Hayek’s Epistemic Market Liberalism

ULRICH WITT
ECONOMICS AND PHILOSOPHY 29.1 (2013): 121-138

Abstract: Epistemic arguments play a significant role in the foundations of market liberalism as exemplified, in particular, by the work of F. A. Hayek. Competition in free markets is claimed to be the most effective device both to utilize the knowledge dispersed throughout society as well as create new knowledge through innovation competition. The fast pace with which new economic opportunities are discovered and costs are reduced is considered proof of the benefits of free markets to the common good. However, the author claims that with its inherently unpredictable consequences, innovation competition is actually ambiguous in this respect. It is argued that this feature raises questions over the stringency of market liberal pleas that oppose quests for redistribution and environmental concerns in an absolute fashion.