Reason and Evolution
What are the limits of human reason? According to philosophers such as Rene DeCartes reason, independent of the senses, can determine knowledge. But is this universally true? Hayek says no.
Knowledge, particularly in the social realm, is dispersed amongst the members of society, and so any attempt to construct complex societal institutions are doomed to failure. In fact, human institutions evolve over time through a process... well, let's let Hayek explain
...a process in which practices which had first been adopted for other reasons, or even purely accidentally, were preserved because they enabled the group in which they had arisen to prevail over others.
Now, I find this extremely interesting because it reminded me of something I learned while reading At the Water's Edge, by Carl Zimmer. In that book, Zimmer talks about the biological-evolutionary concept of exaptation - the idea that traits that had evolved for one purpose can be beneficial for a different purpose, even if the original purpose is lost over time.
I often make the analogy that the market process is an evolutionary process, and that both are examples of non-linear, chaotic systems. Although Hayek doesn't explicitly say as much, one of the lessons I get from this chapter is that the evolutionary process is even more pervasive in human societal development.
Getting back to the theme of human reason, Hayek continually reminds us that information is dispersed and because of this our knowledge is limited. Those who believe that human institutions can be designed by pure reason alone are thwarted in their attempts because of this limitation. Man's confidence in science, says Hayek, has fostered in him the belief that complete knowledge about society is possible.
All is not lost, however. We can overcome our limitation of knowledge by utilizing the dispersed knowledge in a civilized society. We can see this in the institutions of language, morals, currency, etc. More on this later.
Hayek blames the 'rationalist' philosophy that was born out of the Age of Reason for the belief that human reason alone can construct society. Starting with DeCartes, rationalist philosophers believed that the same scientific method that was used to construct physical systems could also be used to create human institutions. We see it in politics today - many believe that just getting the right people in charge will solve all of our problems.
One last interesting link with evolution is the way Hayek criticizes those who think that human institutions must be rationally designed. His tone is similar to the tone that scientists use to criticize creationists who think that biological life is too complex to have emerged without some designer.