Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/57540
Authors: 
Witt, Ulrich
Year of Publication: 
2011
Series/Report no.: 
Papers on economics and evolution 1106
Abstract: 
Epistemic arguments play a significant role in Hayek's defense of market liberalism. His claim that market competition is a discovery procedure that serves the common good is a case in point. The hypothesis of the markets' efficient use of existing knowledge is supplemented by the idea that markets are also most effectively creating new knowledge. However, in his assessment Hayek neglects the role of new technological knowledge. He ignores that the discovery procedure induces not only price and cost competition but also competition by innovations. Thence he overlooks the ambiguity that follows from the unpredictability of the consequences of innovations. This fact is shown to challenge the epistemic foundations and the stringency of Hayek's version of market liberalism.
Subjects: 
competition
innovation
liberalism
knowledge
self-organization
Hayek
JEL: 
B25
D80
O33
P16
Q55
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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