I. INTRODUCTION
Even though Dutch physician Bernard Mandeville was credited with being the first to formulate the economic terms “division of labor” and “laissez-faire,” Footnote 1 Friedrich August Hayek, in his lecture read to the British Academy on March 23, 1966, the penultimate year of Lionel Robbins’s five-year term as president of the academy, told his London audience that he wished to concentrate on Mandeville’s “definitive breakthrough in modern thought”: namely, the twin ideas of evolution and spontaneous order (Hayek Reference Hayek1978, p. 250). Footnote 2
This paper considers Mandeville’s eighteenth-century allegorical Fable of the Bees satire plus the influence of Paul Sakmann’s and Albert Schatz’s studies of Mandeville’s Fable. Hayek acknowledged that both Sakmann’s and Schatz’s respective work on Mandeville had helped him develop and extend the Scottish Enlightenment theory of spontaneous order that explained how the origin of complex social structures were not the result of deliberate human design, but emerged spontaneously though unanticipated human actions in an evolutionary-type process.
Twenty years earlier, in his 1945 Finlay Memorial lecture delivered at University College Dublin, Hayek had also claimed that the origination of ‘true’ individualism had been profoundly influenced by Mandeville, “by whom the central idea of individualism was for the first time clearly formulated” (Hayek Reference Hayek and Caldwell2010, p. 55n16). In his Dublin lecture Hayek set out his preferred general principle of social organization and social order by comparing and contrasting the ‘true’ and ‘false’ types of the same word “Individualism” (Nolan Reference Nolan2013, p. 58). Footnote 3
Hayek further explained to his 1945 Dublin audience that Mandeville’s importance in the history of economics had been long overlooked and neglected except by a few authors, particularly Edwin Cannan and Albert Schatz, plus Frederick Benjamin Kaye’s 1924 two-volume commentary (Hayek Reference Hayek and Caldwell2010, p. 55n16).
In The Constitution of Liberty Hayek acknowledged the role played by Mandeville in the ‘British tradition’ (Hayek [Reference Hayek and Hamowy1960] 2011, p. 110n8), and, in his 1964 “Kinds of Rationalism” lecture at Rikkyo University in Tokyo, Hayek declared that Mandeville was one of his main intellectual forebears, alongside David Hume and Carl Menger (Hayek Reference Hayek1967, p. 84).
In his 1945 Dublin lecture Hayek had outlined how “spontaneous collaboration of free men often creates things which are greater than their individual minds can ever fully comprehend” (Hayek Reference Hayek and Caldwell2010, pp. 53–54), a theme Hayek continued in his 1966 London lecture, quoting Mandeville’s references, in part two of his Fable, to the long evolution of institutions and laws across several ages and generations. This theme of institutions and laws spontaneously forming rather than being formed by the work of one man (Hayek Reference Hayek1978, pp. 260–261) is a theme that Ronald Hamowy considers “Mandeville’s most important legacy to the Scottish thinkers” (Hamowy Reference Hamowy2005, p. 46; 1987, p. 10). Footnote 4
Adam Ferguson’s Reference Ferguson1767 maxim Footnote 5 that society’s social and political institutions develop spontaneously without a central designing and directing mind was incorporated by his close friends David Hume and Adam Smith into their explanations of the origins of complex social structures (Hamowy Reference Hamowy2005, p. 39). In 1966 Hayek succinctly summed up Mandeville’s main contention to his London audience:
that in the complex order of society the results of men’s actions were very different from what they had intended, and that the individuals, in pursuing their own ends, whether selfish or altruistic, produced useful results for others which they did not anticipate or perhaps even know; and, finally, that the whole order of society, and even all that we call culture, was the result of individual strivings which had no such end in view, but which were channelled to serve such ends by institutions, practices, and rules which also had never been deliberately invented but had grown up by the survival of what proved successful. (Hayek Reference Hayek1978, p. 253)
In his 1966 London lecture Hayek also claimed that Mandeville’s Fable had been read by almost everybody and that few had escaped infection by what was contemporaneously often referred to as a “wicked book” (Hayek Reference Hayek1978, p. 252). Mandeville himself was aware of his Fable’s being considered a wicked book because in his last work, A Letter to Dion, his response to Bishop George Berkeley’s criticisms, he acknowledged that many thousands had been led to believe “as if it was a wicked Book … full of dangerous, wicked and atheistical notions, and could not have been wrote with any other design than the encouragement of vice” (Mandeville Reference Mandeville1732, pp. 1, 24).
Hayek cited a borrowed quotation from Joan Robinson’s 1962 Economic Philosophy, in which Dr. Samuel Johnson is claimed to have described Mandeville’s book as one that every young eighteenth-century man had on his shelves in the mistaken belief that the Fable of the Bees was a wicked book (Hayek Reference Hayek1978, p. 252). In a footnote, Hayek explained that he had borrowed the quotation from Robinson’s 1962 book because he had been unable to trace the original source of Dr. Johnson’s comment (Hayek Reference Hayek1978, p. 252n7). Footnote 6
Frederick Benjamin Kaye’s 1924 two-volume treatise on Mandeville was and is still considered the definitive work on Mandeville’s Fable of the Bees, Footnote 7 even though Salim Rashid claimed that while appreciating Mandeville’s satirical writing abilities, “Kaye’s assessment of his influence was a red herring” (Rashid Reference Rashid1985, p. 330). Kaye considered Paul Sakmann’s Reference Sakmann1897 work on Mandeville’s Fable as the “most elaborate work on Mandeville to date” (Mandeville [Reference Mandeville1924] 1988, II, p. 447). Hayek himself appears to have agreed with Kaye’s opinion on Sakmann’s study of Mandeville, telling his 1966 London audience that even though Kaye’s 1924 Mandeville work superseded Sakmann’s Reference Sakmann1897 work, the latter’s work “is still the most comprehensive study of Mandeville” (Hayek Reference Hayek1978, p. 261n37).
Hayek first cited Albert Schatz (1879–1940) in his 1941 “The Counter Revolution of Science” in the Economica (Hayek Reference Hayek1941, I, p. 22) series and again in his 1945 (Hayek Reference Hayek and Caldwell2010, p. 52n12) and 1966 (Hayek Reference Hayek1978, p. 258n22) Dublin and London lectures. Schatz’s Sorbonne doctorate was on the works of David Hume (Schatz Reference Schatz1902), followed by a second doctorate on the rental of safe-deposit boxes in the faculty of law in 1903 (Schatz Reference Schatz1903a). He also became director of the prestigious Institut Français in London, following the French cultural and educational institutions set up in St. Petersburg, Florence, and Madrid (Buxtorf 2011, p. 10), as well as being a co-editor of the Le Revue D’Histoire Économique et Social journal.
In 1903 Schatz first wrote about Mandeville’s contribution to the study of the origins of economic liberalism in a comprehensive, forty-six-page paper for the Vierteljahrschrift für Sozial-und Wirtschaftsgeschichte (Schatz Reference Schatz1903b). In addition, his 1907 book, L’Individualisme Économique et Social (Schatz Reference Schatz1907), included a chapter on Mandeville’s Fable des Abeilles that Hayek cited in his 1945 Dublin lecture. Hayek claimed in his “Individualism: True and False” lecture that Mandeville, half a century before Ferguson, had initially developed all the classical paradigmata of the spontaneous growth of orderly social institutions or structures (Hayek Reference Hayek and Caldwell2010, p. 55n16). Schatz found it surprising that Mandeville wasn’t cited in any history of economic doctrine textbooks, even though he considered that his Fable contained the genesis of social and economic individualism (Schatz Reference Schatz1907, p. 62). Footnote 8
Before I consider how Sakmann’s and Schatz’s studies of Mandeville might have influenced Hayek’s formulation of his spontaneous order theory, it is important to acknowledge the historical context through which Mandeville’s own ideas were diffused. Footnote 9 It is also desirable to remain cognizant of Hayek’s “Counter Revolution of Science” warning that the “tracing of influences is the most treacherous ground in the history of thought” (Hayek Reference Hayek and Caldwell2010, p. 277), Footnote 10 a warning from a deep thinker whose own epistemology evolved over time. As one of the twentieth century’s great interdisciplinary scholars, Hayek had the ability to exquisitely tie together loose ends from different fields of research work that spanned decades, eras, and countries (Davidson Reference Davidson and Marc-Hartwich2010, p. 2).
Much has been written about Mandeville’s Fable throughout the last three centuries, and my own analysis will try to heed Thomas Hobbes’s contextualization caution, Footnote 11 which is supported by Bruce Caldwell’s warning in his 2006 chapter on Karl Popper and Hayek regarding the question of who had the greater influence on the other. Caldwell writes that there was good reason “to be very cautious when speaking in terms of ‘influence’” (Caldwell Reference Caldwell, Jarvie, Milford and Miller2006, p. 112), especially when referring to the influence of earlier writers on later writers and particularly the influence of the cultural and intellectual milieu and the social and economic epoch within which writers worked.
Asserting the influence of one writer’s concepts on another, later writer, unless there is a strong and direct link, is quite problematic, which in turn gives rise to an even greater challenge when considering the contribution of both Sakmann’s and Schatz’s earlier writings on the influence of Mandeville’s Fable upon Hayek. Seeking Sakmann’s and Schatz’s original writings may help to understand the influence and context of Mandeville’s eighteenth-century theory of society on Hayek’s twentieth-century theory of society.
II. PAUL SAKMANN (1864–1936)
Hayek considered Stuttgart University’s Professor Paul Sakmann’s Reference Sakmann1897 work on Mandeville to be the most comprehensive, and Kaye, in 1924, considered it to be the most elaborate work on Mandeville at the time, due to the way Sakmann analyzed Mandeville’s thought and the way he described the controversy precipitated by the Fable (Mandeville [Reference Mandeville1924] 1988, II, p. 447).
Sakmann specialized in the development of eighteenth-century thought, and his 1910 work on François Marie Arouet Voltaire (Sakmann Reference Sakmann1910) and his 1913 study of Jean-Jacques Rousseau (Sakmann Reference Sakmann1913) were each listed as major works in his 1936 obituary, whereas his 1897 work on Mandeville was inexplicably omitted from Sakmann’s list of works, even though his translation of Walter Lippmann’s 1929 A Preface to Morals and John Dewey’s 1922 Human Nature and Conduct are listed (Binder Reference Binder1937, p. 15). In volume two of his The Enlightenment Peter Gray recognized that Mandeville influenced both Voltaire and Adam Smith, even though Gray described Mandeville as “the notorious freethinker who scandalized his century” (Gray Reference Gray1969, p. 15).
Sakmann discussed both Voltaire’s and Rousseau’s criticisms of Mandeville’s Fable in his 1897 book (Sakmann [Reference Sakmann1897] 2012, pp. 208–212). In his 1945 Dublin lecture Hayek had described Rousseau as one of the outstanding representatives of Cartesian rationalism, whose theory of society and liberty he regarded as a source of modern socialism or collectivism (Hayek Reference Hayek and Caldwell2010, p. 50). Footnote 12 According to Hayek, the anti-rationalistic characteristic of English ‘true’ individualism was profoundly influenced by Mandeville, “by whom the central idea of individualism was for the first time clearly formulated” (Hayek Reference Hayek and Caldwell2010, p. 55). Hayek, in his 1945 Dublin lecture, described what he named his own anti-rationalistic approach as one in which man is a “fallible being, whose individual errors are corrected only in the course of a social process … which aims at making the best of a very imperfect material” (Hayek Reference Hayek and Caldwell2010, p. 55). Footnote 13 In his preface to his Fable, Mandeville himself acknowledged the beneficial importance of man’s imperfection:
I demonstrate if Mankind could be cured of the Failings they are Naturally guilty of, they would cease to be capable of being rais’d into such vast potent and polite Societies, as they have been under the several great Commonwealths and Monarchies that have flourish’d since Creation. (Mandeville [Reference Mandeville1924] 1988, I, p. 7)
In 1960 Hayek’s further understanding of the term “rationalism” reflected philosopher Bernard Groethuysen’s discussion in volume thirteen of the 1934 Encyclopedia of the Social Studies (Hayek Reference Hayek and Hamowy2011, p. 110n8). Footnote 14
In his “Kinds of Rationalism” lecture Hayek continued developing his interpretation of Cartesian rationalism as a rationalist constructivism, according to which useful human institutions are unavoidably the deliberate creation of conscious reason. Hayek argued that this kind of naive rationalism is blind to the influential power of historical evolution (Hayek Reference Hayek1967, p. 85). Rather than continue using the term “anti-rationalist” from his 1945 Dublin lecture, in contrast to what he considered Cartesian constructivist rationalism based on induction and ‘false’ individualism, in his 1960 Tokyo lecture Hayek adopted fellow Austrian Karl Popper’s term “critical rationalism,” as “it seems to me the best term for describing the general position which I regard as the most reasonable one” (Hayek Reference Hayek1967, p. 94). Footnote 15 Ronald Hamowy also believes that the doctrine of spontaneous order belongs to “critical rationalism” (Hamowy Reference Hamowy1987, p. 6).
Sakmann highlighted how Mandeville’s Fable described society as a work of art, not of nature, because nature creates flawless perfection, unlike the imperfection created by art (Sakmann [Reference Sakmann1897] 2012, p. 129). After reviewing and commenting upon Mandeville’s development of society, Sakmann claims that he was not convinced Adam Smith borrowed his principle of the division of labor from Mandeville.
According to Sakmann, despite the striking similarities of passages in both Adam Smith and Mandeville’s works, as shown by Wilhelm Roscher, founder of the German Historical School, Sakmann considered that Adam Smith “would have really given at least the national economic fruitful turn to the idea of Mandeville, if he [Adam Smith] had used it” (Sakmann [Reference Sakmann1897] 2012, p. 129).
In his section on Mandeville’s writings about church and clergy, Sakmann stated that Mandeville had an eye for the peculiar power of the church, not just the Roman Catholic Church but also the oppressed Protestant clergy, who have the same weakness for control (Sakmann [Reference Sakmann1897] 2012, pp. 183–186). Mandeville, understandably, considering the religious upheavals of the late sixteenth and early seventeenth centuries throughout Holland, was averse, according to Sakmann, to allowing too much power and authority into the hands of the clergy. In his fable he recommended the Dutch policy “not to meddle in state matters … to preserve public tranquillity” (Sakmann [Reference Sakmann1897] 2012, p. 187).
Sakmann describes how Voltaire mentioned Mandeville in his 1764 Philosophical Dictionary (Voltaire [Reference Voltaire1764] 1878, pp. 26–30), providing a short overview of Mandeville’s famous fable of the bees, which, according to Voltaire, had caused such a sensation in England. Sakmann claimed that, in his opinion, the outline of the fable (La Fable des Abeilles) that Voltaire had described was not in fact Mandeville’s fable but “The Fable of the Bees” from chapter fifteen of Simon Tissot de Patot’s Reference Patot1710 Voyages et Aventures de Jacques Masseé (Patot Reference Patot1710), published in the Hague, Holland, a fable that was “frequently confused with that of Mandeville elsewhere” (Sakmann [Reference Sakmann1897] 2012, p. 208). Patot’s literary adventure book, a genre of fictional travel book common in the eighteenth century, was also later translated into English and published in London in 1733 a year before Mandeville died (Patot [Reference Patot1733] 2012).
Was it coincidental that, four years after Patot’s Reference Patot1710 book, which included his “Fable of the Bees,” Mandeville, in 1714, launched the first part of his The Fable of the Bees: or Private Vices Publik Benefits, following its initial publication under the original title The Grumbling Hive: or Knaves Turn’d Honest in 1705 (Mandeville [Reference Mandeville1924] 1988, II, pp. 386–388)? Footnote 16
I consider it a possibility that Mandeville may have been aware of Patot’s Reference Patot1710 book, because Patot lived most of his life in Holland and, at the time of the 1690 Costerman Riots, in which Mandeville and his father participated, was resident in Deventer near Rotterdam, the hometown of the Mandevilles. Patot’s fable had one similar theme to Mandeville’s fable: all was orderly in the utopian imaginary island where the bees were free to source their nectar from any flowers they chose until the monarch decided to deliberately direct the bees as to which flowers they could or could not touch (Patot [Reference Patot1733] 2012, p. 293).
Confusing Patot’s fable of the bees with Mandeville’s Fable wouldn’t be the first time that Voltaire had relied on an incorrect or modified version to fit his own arguments. Footnote 17 Sakmann furthermore claimed that the main idea of Voltaire’s 1768 satirical poem Le Marseillois et le Lion was “the refutation of the pretensions of the anthropocentric worldview through irony, belong totally to Mandeville” (Sakmann [Reference Sakmann1897] 2012, p. 209).
Confusion among contemporary condemners of Mandeville’s Fable was not confined to Voltaire. In his 1725 An Inquiry Concerning the Original of Our Ideas of Virtue or Moral Good, Adam Smith’s mentor Francis Hutcheson, “of whom it was said that he could give no lecture from his chair at Glasgow without criticizing Mandeville” (Hundert [Reference Hundert1994] 2005, p. 57), denounced Mandeville’s Fable, using quotations that were “not in fact, quotations from any of Mandeville’s works!” (Heath Reference Heath1999, p. 229). Kaye claimed that Hutcheson was one of Mandeville’s most persistent contemporary opponents (Mandeville [Reference Mandeville1924] 1988, II, p. 345n1) and that “Mandeville was an obsession with Hutcheson … he could hardly write a book without devoting much of it to attacking the Fable” (Mandeville [Reference Mandeville1924] 1988, I, p. cxli). Footnote 18
Ira Wade’s comprehensive 1947 examination of Voltaire’s relationship to Mandeville and his Fable did not mention Sakmann’s Mandeville or Voltaire studies. He concluded that although Voltaire’s debt to Mandeville was an important one, “it is perhaps an exaggeration to regard it as of capital importance,” because he considered “Mandeville easily fitted into a traditional French current of libertinism from Montaigne through Saint-Evremond to Bayle” (Wade [Reference Wade1947] 1967, p. 49).
In his final chapter on the historic position and importance of Mandeville’s Fable, Sakmann succinctly acknowledged that
finally, we still have to contemplate the historical significance of the idea, which accounts for Mandeville’s originality and which, though initially probably not much more than a frivolous quip, has grown gradually to a system of thoughts, that is based on not insignificant work. (Sakmann [Reference Sakmann1897] 2012, p. 296)
Mandeville’s contradiction between what is and what should be has presented a problem to philosophy, according to Sakmann. Nevertheless, Sakmann concluded in his 1897 study that Mandeville “should not be deprived from the honour that is due to him who revealed with intellect and a sharp eye the weaknesses of our moral and historical being and yet with new difficulties knew how to assign us new challenges” (Sakmann [Reference Sakmann1897] 2012, p. 300).
III. ALBERT LUCIEN SCHATZ (1879–1940)
Albert Schatz was born in the French northwest Normandy town of Harve, and during the First World War he worked for the French government on behalf of his friend and supporter Minister for War Alexandre Millerand, who would become president of the Third Republic in 1920. Inevitably, economic decision making became centralized to enable France and her allies to survive and eventually win the 1914 to 1918 war.
As part of the efforts to rebuild France’s economy after the war, Schatz became involved in establishing Henri Fayol’s Centre d’Études Administratives to promote the doctrine of Fayolism relating to reorganizing the state’s inefficient administrative management of its commercial entities by applying the guiding principles of successful modern business management (Breeze Reference Breeze, Wood and Wood2002, pp. 93–123). Footnote 19 Fayol’s center sponsored Schatz’s Reference Schatz1922 L’Entreprise Gouvernementale et son Administration (Schatz Reference Schatz1922), which included a long preface by Fayol. Schatz’s final book criticized the French government’s costly role in ownership of many national industrial services, recommending that the true function of government be to reduce rather than increase these state undertakings. The ruinous result of Schatz’s Reference Schatz1922 polemic was that he became ostracized and eventually changed his career to become a playwright. According to John J. Horgan’s contemporaneous review of Schatz’s book, Schatz’s remedy was that the French political administration should concentrate on government matters “and disencumber itself of undertakings which it is radically incapable of managing” (Horgan Reference Horgan1922, p. 653).
Schatz would not regain an academic position in a French university for twelve years, until Lyon in 1934 (Curty Reference Curty and Potier1995, p. 108). He took his own life in 1940 (Curty Reference Curty2000, p. 388). Jacques Schatz, Albert’s son, refers to this calamitous period of his father’s life as “sort of madness years” spent in the shade of his heretofore successful career (Curty Reference Curty and Potier1995, p. 11). Footnote 20
Schatz was a law professor at the French universities of Aix-Marseille (1903 to 1906), Dijon (1906 to 1908), and Lille (1908 to 1922), later returning to academia at Lyon University (1934 to 1940). In 1903 Schatz first wrote about Mandeville’s contribution to the study of the origins of economic liberalism in a comprehensive, forty-six-page paper for the Vierteljahrschrift für Sozial-und Wirtschaftsgeschichte journal (Schatz Reference Schatz1903), which Kaye acknowledged as being “one of the most valuable articles on Mandeville” (Mandeville [Reference Mandeville1924] 1988, II, p. 448). In addition, his 1907 book, L’Individualisme Économique et Social, included a chapter on Mandeville’s Fable des Abeilles that Hayek cited in his 1945 Dublin lecture.
Schatz explained that only the work of Dr. Paul Sakmann in Germany and Professor Giacômo Laviosa (Laviosa Reference Laviosa1897) Footnote 21 in Italy gave Mandeville his true place in the moral philosophy of the eighteenth century, while, in France, Schatz considered, Mandeville’s existence had been totally ignored in both economic history works and in political economy dictionaries (Schatz Reference Schatz1907, p. 435). An illustrious literary critic, according to Schatz, considered the eighteenth century to be the most powerful and fertile epoch of human spirit and social thought. Schatz explained to his readers that he proposed a review of Mandeville’s original philosophy of economic liberalism as if he were an unknown in order to properly illustrate Mandeville’s value (Schatz Reference Schatz1903, p. 435).
Schatz linked “libéralisme” to Mandeville’s works, notably the two independent propositions that in economic matters, individuals were principally guided by self-interest and acted harmoniously in a liberal society, under a political policy of abstention by the state except as an energetic guarantor of private property and as a protector of members of society (Schatz Reference Schatz1903, p. 440). Schatz believed that society was not an artificial creation, with the government’s having the leading role, but that society was a purely natural phenomenon, like the ground it stood upon (Schatz Reference Schatz1907, p. 488). According to Schatz, the origin of the doctrine of economic liberalism is found “first and foremost in the psychological study of individuals living in a society contained within the moral philosophy work of the author of the Fable of the Bees” (Schatz Reference Schatz1903, p. 436). Footnote 22
According to Schatz, this original idea of how individuals, in pursuing their own happiness, unwittingly contribute to society’s economic benefit—the essence of Mandeville’s philosophy—was first expressed within the history of economic thought by Mandeville (Schatz Reference Schatz1903, p. 449). Having outlined Mandeville’s Fable in the first section of his 1903 paper, Schatz, in the second section, on the social philosophy of liberalism, claimed that Mandeville could not be credited with exclusively creating the new doctrine of liberalism (la doctrine liberal). Describing Mandeville’s influence as an eminent precursor of liberalism, Schatz acknowledged his inspired observations on the division of labor, notwithstanding his synthesis of the new doctrine of liberalism (Schatz Reference Schatz1903, p. 461). Hayek similarly concurred with Schatz’s claim in his 1966 London lecture, in which he asserted that he wasn’t simply going to represent Mandeville as a great economist, albeit acknowledging that “we owe to him … the term ‘division of labour’” (Hayek Reference Hayek1978, p. 249).
Schatz considered that Mandeville was a popularizer more than a creator in the way, for example, that he managed to compress the economic ideas of Pierre Bayle, Claude Adrian d’Helvetivis, and François Duc de la Rochefoucauld into his pamphlet (Schatz Reference Schatz1907, p. 461). Schatz considered that David Hume and Adam Smith had each in turn drawn much inspiration from Mandeville and that some of their expressions were borrowed from his Fable (Schatz Reference Schatz1907, p. 127). Again echoing Schatz, Hayek claimed in his 1966 London lecture that Mandeville made Hume possible, and that, through Hume, Mandeville exercised his most lasting influence (Hayek Reference Hayek1978, p. 264).
Schatz suspected that Mandeville had been neglected in studies of the history of economic doctrines, due to his acerbic irony and his religious orthodoxy (Schatz Reference Schatz1903, p. 63). Mandeville’s Fable claimed how, due to self-interest, individuals always resorted to division of labor in order to reduce their own efforts, which Schatz described as the principle of spontaneous adaptation (spontané d’adaptation) (Schatz Reference Schatz1907, p. 74).
IV. “LE PRINCIPE D’ORDRE SPONTANÉ”
In the conclusion of his second chapter on Mandeville, Schatz described how the first adversaries of mercantilism had searched, without success, for the spontaneous order principle (le principe d’ordre spontané) (Schatz Reference Schatz1907, p. 79). In the preceding chapter, Schatz had outlined and described mercantilism plus the reaction of anti-mercantilists, claiming that the origins of the doctrine of individualism could be found within the liberal anti-interventionist movement that developed against mercantilism (Schatz Reference Schatz1907, p. 14).
Schatz then outlined the evolution of the eighteenth-century realization that regulated “artificial” economic order could be substituted by “un ordre naturel économique,” underpinned by the solid foundation of a rare phenomena called “cet ordre spontané” (this spontaneous order) whose “majestic simplicity and harmonious splendor has not yet been fully revealed except by a few discerning thinkers” (Schatz Reference Schatz1907, p. 32).
In the section of chapter six commenting upon the errors of the French Revolution, Schatz cited sociological historian Hippolyte Taine’s Les Origins de la France Contemporaine (The origins of contemporary France). Taine had completed his mammoth, multi-volume, historical analysis of the French Revolution between 1875 and 1893. Schatz claimed, in summary, that Taine had outlined three fundamental elements underpinning the theory of individualism that Taine believed the French revolutionaries had critically misunderstood in 1789.
According to Schatz, Taine stated that the second fundamental element the French revolutionaries had misunderstood was that economic order is a spontaneous creation of nature, not an arbitrary creation of the human mind: “La seconde, c’est que l’ordre économique est une création spontanée de la nature et non une création arbitraire de la volonté humaine” (Schatz Reference Schatz1907, p. 357). Unfortunately, Schatz does not cite in which volume of Taine’s multi-volume Les Origins de la France Contemporaine the phrase is located.
Hayek, in his “The Counter Revolution of Science” series, claimed Taine was one of the leading social thinkers who derived their ideas from the combined Comtean and Hegelian doctrines that society can be improved by “conscious direction” (Hayek Reference Hayek and Caldwell2010, pp. 280n106, 289–300). Alfred Cobban claimed in his 1968 History paper that the aim for Taine’s great—but which he considered flawed—work was to trace the source of the natural evil of human nature: the king and his government (Cobban Reference Cobban1968, pp. 339–341). In the introduction to his famous five-volume Histoire de la Littérature Anglaise, Taine explained that history should use the methods of science, when he chose to analyze the psychology of a people through their literature and how the ancient barbarous Saxons became the English, although Taine acknowledged that their civilization had developed both spontaneously and with forced deviation: “qu’outre son développement spontané, elle offre une deviation force” (Taine [ Reference Taine1866 ] 2012, vol. I, p. viii). Footnote 23
It is important to highlight the potential confusion caused by the contradiction of a constructivist like Taine, who was an acknowledged follower of positivists Henri de Saint-Simon and Auguste Comte, and was the source, through Schatz, of Hayek’s non-constructivist use of the term “spontaneous order.” This use of “spontaneous order” by Taine was at the time when the major methodological thrust of ‘true’ individualism was in opposition to the rise of positivism (Gramm Reference Gramm1975, p. 757). Conflicting meanings being attached to the same word is very similar to Hayek’s Dublin outline of the rationalist and non-rationalist use of the word “Individualism,” despite how the adherents “believe in contradictory and irreconcilable ideals” (Hayek Reference Hayek and Caldwell2010, p. 47). Footnote 24
Schatz’s citing of Taine’s assertion that “l’ordre économique est une création spontanée de la nature et non une création arbitraire de la volonté humaine” could, I consider, be the inspiration for Hayek’s coining the term “spontaneous order.” Hayek owned a copy of Schatz’s Reference Schatz1907 book in his personal library collection (Nolan Reference Nolan2013, p. 59n11), now held in Austria. Hayek appears to have forgotten selling his copy of Schatz’s book to Universitätsbibliothek Salzburg in the early 1970s.
Corresponding in 1983 with Schatz’s son, Jacques Schatz, about writing a preface for a proposed reprint of L’Individualisme Économique, Hayek said, “I am indeed a great admirer of your father’s work and greatly regret that my copy of ‘L’Individualisme etc. has somehow vanished and seems to be irreplaceable.” Footnote 25 Furthermore, Hayek contended in his 1945 Dublin lecture that he was much indebted to Schatz’s book as a contribution to both individualism and to the history of economic theory in general (Hayek Reference Hayek and Caldwell2010, p. 52n12).
There has been a vexed debate as to whether Hayek rediscovered and named the term “spontaneous order,” notwithstanding the comprehensive studies on the history and origination of the theory of spontaneous order by Norman Barry (Reference Barry1982) and Ronald Hamowy (Reference Hamowy1987 and Reference Hamowy2005), plus Struan Jacobs’s study of Michael Polanyi’s use of “spontaneous order” compared with Hayek’s (Jacobs 1997–Reference Jacobs98). Footnote 26 In addition, a 2007 collection of essays on Hayek’s spontaneous order theory, edited by Louis Hunt and Peter McNamara, claims that the importance of Hayek’s theory to the development of economic theory in the twentieth century is indisputable (Hunt Reference Hunt, Hunt and McNamara2007, p. vii).
Polanyi, along with Hayek, Ludwig von Mises, Lionel Robbins, and Wilhelm Röpke, was one of the founding members of the neoliberal Mont Pèlerin Society in 1947 who had together attended its precursor, the 1938 Colloque Walter Lippmann conference held in Paris (Mirowski and Plehwe Reference Mirowski and Plehwe2009, p. 21). In his Constitution of Liberty Hayek had outlined how, in a free society, rules
have never been deliberately invented but have grown through a gradual process of trial and error in which the experience of successive generations has helped to make them what they are … and how such a mutual adjustment of the spontaneous activities of individuals is brought about by the market, provided that there is a known delimitation of the sphere of control of each individual. (Hayek [Reference Hayek and Hamowy1960] 2011, pp. 225, 229)
John P. Bladel’s Reference Bladel2005 paper in The Quarterly Journal of Austrian Economics muses that it would be interesting to know who first used the term “spontaneous order,” from an intellectual genealogy perspective (Bladel Reference Bladel2005, p. 21). Norman Barry claimed that both Hayek and Schumpeter regarded the Jesuit Luis de Molina of the Spanish school of Salamanca as one of the first clear expositors of spontaneous order in the sixteenth century (Barry Reference Barry1982, pp. 13–14), and Hamowy found that the germ of the spontaneous order idea can also be found in Chuang Tzu’s fourth-century BC writings (Hamowy Reference Hamowy2005, p. 6).
In his London lecture on Mandeville, Hayek suggested that the sixteenth-century Spanish Jesuits of Schoolmen, particularly scholar Luis Molina, were the first to systematically question “how things would have ordered themselves if they had not otherwise been arranged by the deliberate efforts of government; they thus produced what I should call the first modern theories of society” (Hayek Reference Hayek1978, p. 255n12).
Jacobs claims that Polanyi cited Gestalt psychologist Wolfgang Köhler’s “dynamic order” as a possible source in 1941 (Jacobs 1997–Reference Jacobs98, p. 17), Footnote 27 and, in his latest study, mentions a citation from Rudolf von Jhering’s 1877–83 two-volume Der Zweck im Recht (The purpose in law). Footnote 28 Bladel further claimed that Wilhelm Röpke had used the term “spontaneous order” a decade before Polanyi (Bladel Reference Bladel2005, p. 26). In Patrick M. Boarman’s 1963 translation of the 1961 ninth edition of Röpke’s Die Lehre von der Wirtschaft, Röpke wrote, “[T]he existence of order in spite of anarchy—’spontaneous’ if we wish— … make evident the fundamental superiority of the spontaneous order over the commanded order” (Röpke [Reference Röpke1937] 1963, p. 4).
Patrick M. Boarman’s 1963 translation of Röpke’s Reference Röpke1961 ninth edition (Röpke Reference Röpke1961) uses quotation marks and italics, whereas in Röpke’s Reference Röpke1937 first edition (Röpke Reference Röpke1937), the phrase “spontaneous order” (die spontane Ordnung) is printed without italics or quotation marks. This suggests to me that Röpke, a quarter of a century after his first edition, may have considered spontane Ordnung as a concept that had by then become common currency (Röpke Reference Röpke1961, p. 19).
Louis Hunt, in his chapter on the origin and scope of Hayek’s spontaneous order idea, believes that the earliest intimations of Hayek’s view of the market as a spontaneous order can be found in his contributions to the 1920s and 1930s Socialist Calculation debate, whose impetus was Ludwig von Mises’s 1920 Economic Calculation in a Socialist Commonwealth essay (Hunt Reference Hunt, Hunt and McNamara2007, p. 45). In his 1945 Dublin lecture Hayek stated that “true individualism is the only theory which can claim to make the formation of spontaneous social products intelligible” (Hayek Reference Hayek and Caldwell2010, p. 56).
None of these assertions on the philological origins of the term “spontaneous order” were made with any awareness of Schatz’s explicit use of the term in his 1907 chapter on Mandeville. Hayek identified Mandeville’s Fable as the source of the theory of spontaneous order, and, furthermore, he acknowledged the influence of Schatz’s studies on Mandeville in formulating his own theory of spontaneous order.
It would also be useful to trace the source of Schatz’s use of the term “le principe d’ordre spontané” beyond Taine’s assertion that “l’ordre économique est une création spontanée de la nature” (Schatz Reference Schatz1907, p. 357), and what may have influenced Schatz, when researching further into the origins of spontaneous order.
I suspect that one possible source could emanate from the works of his mentor professor Auguste Deschamps (1863–1935). In 1895, as a professor in Lille University, where Schatz would follow from 1908 to 1922, Deschamps initiated the teaching of d’histoire des doctrines économiques (Allix Reference Allix1937, p. 10). This commencement of courses on the history of economic thought in French universities, at the time, was necessary in order to comply with an April 1895 government decree that made it compulsory for candidates to have completed a course on the history of economic thought to obtain a doctorate in law (Ferraton and Prévost Reference Ferraton, Prévost and Schatz2013, p. x). Writing in an obituary about his mentor’s life and works, Edgard Allix declared that for Deschamps the key theme of his decades of liberal economic teachings hinged on the word liberté (Allix Reference Allix1937, p. 32). Schatz dedicated his 1907 L’Individualisme Économique to Deschamps, and he recommended Deschamps’s lectures (Schatz Reference Schatz1907, p. 558n1) on contemporary economic doctrines as well as the history of economic thought (Deschamps Reference Deschamps1900).
Hayek conceivably could have borrowed the term “spontaneous order theory” from Schatz, as he had already admitted, in his 1945 Dublin lecture, to borrowing a French phrase translated into English to use as the title for The Road to Serfdom. Hayek acknowledged that it was Tocqueville’s “formule de la servitude” (Tocqueville Reference Tocqueville and Lévy1878, p. 541) phrase that he used in his 1848 address to the French Constitutional Assembly and that provided Hayek with the title of his The Road to Serfdom (Hayek Reference Hayek and Caldwell2010, p. 61n24).
Another contemporary example of Hayek’s borrowing a French phrase as a title is his apparent borrowing of a quotation from contre révolutionnaire Louis de Bonald for the title of his 1941 The Counter Revolution of Science series, as suggested by Stuart Jones (Jones Reference Jones2002, p. 58n36). Jones quotes M. Epstein’s 1909 English translation of Werner Sombart’s Reference Sombart1903 Sozialismus und soziale Bewegung (Socialism and the social movement), a lament to Karl Marx.
We know Hayek read the original German version of Sombart’s Reference Sombart1903 book because he cites its seventh edition in his 1941 The Counter Revolution of Science series (Hayek Reference Hayek and Caldwell2010, p. 195n41) when referring to Henri de Saint-Simon’s Lettres d’un Habitant de Genève as “the first and most important document of that ‘counter-revolution of science’, as their fellow reactionary Bonald called the movement” (Hayek Reference Hayek and Caldwell2010, p. 195n41). Sombart had credited Bonald with labelling the movement as the “Gegen-revolution der Wissenschaft (une contrerévolution de la science)” (Sombart [Reference Sombart1903] 1919, p. 54).
The phrase in French translated into English exactly matches the title of Hayek’s Reference Hayek1941 The Counter Revolution of Science Economica series—recently reprinted in volume thirteen of his Collected Works Footnote 29 —outlining the origins of scientism in France. Footnote 30
Bonald and his followers were against the French Revolution and desired a return to the old traditional regime. David Klinck’s biography of Bonald claims that Bonald’s thoughts foreshadow authoritarian nationalism and fascism, and that the founders of positivism, Henri de Saint-Simon and Auguste Comte, were much influenced by the counter-revolutionary thought of Bonald (Klinck Reference Klinck and Coppa1996, pp. 8–9).
Unlike Mandeville and Hayek, Bonald, according to Klinck, “was a believer in the indefinite perfectibility of man” (Klinck Reference Klinck and Coppa1996, p. 97) and agreed with the belief in the ability of an authoritarian state to progress individuals into a perfect social organization. It is doubtful whether Bonald actually used the phrase “une contrerévolution de la science,” but more likely it was a phrase devised by twentieth-century historians, such as Sombart, to describe Bonald’s eighteenth-century theory, according to my correspondence with two of Bonald’s biographers, Robert Spaemann (Reference Spaemann1959) and David Klinck (Reference Klinck and Coppa1996). Footnote 31
In his 1945 Dublin lecture, Hayek explained how English ‘true’ individualism regards man as a non-rational and fallible being, rather than an intelligent, Cartesian rationalist individual whose individual errors are corrected only in the course of an un-designed social process.
The predominance of this anti-rationalistic approach in English thought seemed to Hayek to be “due largely to the profound influence exercised by Bernard de Mandeville, by whom the central idea was for the first time clearly formulated” (Hayek Reference Hayek and Caldwell2010, p. 55). In an accompanying footnote, Hayek asserted that “the decisive importance of de Mandeville in the history of economics, long overlooked or appreciated only by a few authors (particularly Edwin Cannan and Albert Schatz) is now beginning to be recognized” (Hayek Reference Hayek and Caldwell2010, p. 55n16). Footnote 32
In his 1945 Dublin lecture Hayek also stated that ‘true’ individualism was the only theory that could claim to make the formation of spontaneous social institutions intelligible (Hayek Reference Hayek and Caldwell2010, p. 56), and he further stated that “the spontaneous collaboration of free men often creates things which are greater than their individual minds can ever fully comprehend” (Hayek Reference Hayek and Caldwell2010, pp. 53–54).
Earlier in the twentieth century, Schatz had already claimed that the important origins of individualism could be found in Mandeville’s Fable—“Tel est dans sa composition externe l’ouvrage capital où se trouvent tous les germes essentiels de la philosophie économique et sociale de l’individualisme” (Schatz Reference Schatz1907, p. 62). Schatz’s individualism opposes the idea of equality that he considers a rational metaphysical creation, unlike everything within nature, which is innately unequal (Schatz Reference Schatz1907, p. 518). Footnote 33 Agreeing with Schatz, Hayek, in his Dublin lecture, claimed that “only because men are in fact unequal can we treat them equally … there is all the difference in the world between treating people equally and attempting to make them equal” (Hayek Reference Hayek and Caldwell2010, p. 61).
In a footnote to his 1966 London lecture Hayek claimed that scholars must be deeply indebted to Kaye’s 1924 Oxford University edition of The Fable of the Bees (Hayek Reference Hayek1978, p. 249), quoting what he considered the crucial passage from Mandeville’s development of division of labor in the second volume’s third dialogue, in which Cleomenes announced to Horatio “that we often ascribe to the excellency of man’s genius, and the depth of his penetration, what is in reality owing to the length of time, and the experience of many generations, all of them very little differing from one another in natural parts and sagacity” (Mandeville [Reference Mandeville1924] 1988, II, p. 142).
V. CONCLUDING DISCUSSION
It is apparent that Hayek’s theory of spontaneous order was primarily developed and extended from the studies of Scottish Enlightenment thinkers such as Hume and Ferguson, including Mandeville’s early eighteenth-century provocative allegorical fable.
A full translation of both Sakmann’s and Schatz’s Mandeville studies would assist further research into the work of both men who, Hayek claimed, had in turn influenced him, especially since Frederick Kaye acknowledged the comprehensive quality and important value of both Sakmann’s and Schatz’s Mandeville studies (Mandeville [Reference Mandeville1924] 1988, II, pp. 447–448), sentiments that Hayek echoed in both his Dublin and London lectures.
I agree with Cyrille Ferraton’s and Benoît Prévost’s assertion that Schatz is the crucial connecting link in the intellectual chain between the eighteenth-century Scottish Enlightenment thinkers and more recent twentieth-century thinkers such as Hayek (Ferraton and Prévost Reference Ferraton, Prévost and Schatz2013, p. viii). Schatz’s Reference Schatz1907 book on the origins and evolution of individualism is, I consider, a veritable treasure trove vis-à-vis tracing the diffusion of the idea of spontaneous order. Footnote 34
Hayek claimed Mandeville’s Fable as the main source of the theory of spontaneous order, and we know he positively acknowledged both Sakmann’s and Schatz’s original writings on Mandeville’s Fable. Undoubtedly, these commentaries on Mandeville’s Fable and theory of societal evolution in turn helped form Hayek’s own interpretation of Mandeville’s theory and his formulation of his spontaneous order theory with Schatz’s le principe d’ordre spontané of Mandeville, plus his summary of Taine’s individualism thesis that the French revolutionaries misunderstood the fact that economic order is a spontaneous creation—l’ordre économique est une création spontanée. Each possibly provided the inspiration and source for Hayek’s coining the term “spontaneous order” for his theory.
Hayek’s incongruous reliance on a rational constructivist such as Hippolyte Taine as the source for his non-rational, non-constructivist use of the term “spontaneous order” merits further examination, preferably by using a ‘true’ and ‘false’ spontaneous order-type format like Hayek used in his 1945 Dublin lecture in order to avoid the contradictory use of the same term by opposing sides. In the same vein, Hayek’s incongruous use of rationalist Louis de Bonald’s “une contrerévolution de la science” phrase—attributed by Sombart in his lament to Karl Marx—as the title for his Counter Revolution of Science series on the origins of Saint-Simon’s scientism is also understandably confusing.
Hamowy claimed that the notion of spontaneous order pervades Mandeville’s Fable and that “Mandeville regarded the growth of social institutions and the advancement of knowledge as products of an evolutionary process that emerged as the unintended outcome of countless individual actions” (Hamowy Reference Hamowy1987, p. 9).
In his 1966 London lecture Hayek concluded that Charles Darwin’s theory was the culmination of a development started by Mandeville and that the work of both men caused scandal to the church (Hayek Reference Hayek1978, p. 265). Footnote 35 Six years earlier, in chapter four of his Constitution of Liberty, Hayek analyzed the origins of society’s institutions and laws, concluding that they emerged as the result of adaptive evolution first developed by “Bernard Mandeville’s paradox to its first cogent expression by David Hume in his ‘Dialogues Concerning Natural Religion’” (Hayek [Reference Hayek and Hamowy1960] 2011, p. 115n23).
According to Hayek, Darwin had borrowed his biological theories of evolution from the social sciences’ earlier theories of social evolution, Footnote 36 the reverse of what was commonly believed. Hayek reiterated this in the first chapter, “Reason and Evolution,” of his 1973 Law, Legislation and Liberty (Hayek [Reference Hayek1973] 1982, I, pp. 22–23n33). Renee Prendergast considers that Mandeville’s reflections on the nature and progress of medical knowledge were a starting point for his theories of society developed in his Fable (Prendergast Reference Prendergast2014). Hayek acknowledged that Mandeville’s understanding into the workings of the human mind, with his medical training, led him to the two foundations of his satire on the conceits of rationalism: “we do not know why we do what we do, and that the consequences of our decisions are very often different from what we imagine them to be” (Hayek Reference Hayek1978, p. 250).
Maurice M. Goldsmith stated that Mandeville’s formulation of a new social theory in his Fable was a reworking of the ideas he had already coherently argued in his satirical series penned for The Female Tatler (Goldsmith Reference Goldsmith1976, p. 508). Goldsmith also acknowledged Paul Bunyan Anderson’s Reference Anderson1936 Philological Quarterly paper as being the first to identify Mandeville’s anonymous contributions to The Female Tatler, between 1709 and 1710 (Goldsmith Reference Goldsmith1976, p. 500). Footnote 37
Kaye wrote that Mandeville’s influence was so far-reaching and fundamental that he described him as one of the most important writers of the eighteenth century (Kaye Reference Kaye1921, p. 419). Kaye also considered “a great part of Mandeville’s thought was derivatory,” but that much of Mandeville’s originality therefore “lay in his manner of exposition” (Mandeville [Reference Mandeville1924] 1988 I, pp. cxi–cxii), developed, in my opinion, from Mandeville’s familiarity with allegorical and polemical pamphlets penned by such masterful philosophers, satirists, and writers as Daniel Defoe, Simon Tyssot de Patot, and Jonathan Swift.
In his doctoral thesis on Hume’s works, Schatz had also written about the paradox of man’s imperfection; how “contained within human imperfections there was a compensating natural order that produced good outcomes for society” (Schatz Reference Schatz1902, p. 155). Footnote 38
Mandeville, according to Kaye, was the first to realize how little society was deliberately “invented” (Mandeville [Reference Mandeville1924] 1988, I, p. cxiiin1), a belief that Hayek would continue to hold throughout his lifetime. Mandeville’s beehive anticipated Ferguson’s maxim that society’s social and political institutions were “indeed the result of human action but not the execution of human design” (Ferguson Reference Ferguson1767, p. 183), which was the bedrock assumption of Hayek’s spontaneous order theory. Footnote 39 According to Hayek, how society’s institutions grew through a long evolutionary process of trial and error made Mandeville’s “investigation into the origin of society which constitutes part II of the Fable so remarkable a work” (Hayek Reference Hayek1978, p. 260).
In his essay “The Nature of Society,” included in the 1723 second edition of his Fable, Mandeville wrote that “the Necessities, the Vices and Imperfections of Man, together with the various Inclemencies of the Air and other Elements, contain in them the Seeds of all Arts, Industry and Labour” (Mandeville [Reference Mandeville1924] 1988, I, p. 366).
It is impossible to isolate Mandeville from contemporary social, religious, and political movements when one analyzes the economic thought of his Fable three centuries later. Hayek himself had surmised in his 1966 London lecture that Mandeville may have been influenced by Dutch Jesuit theologian Leonard Lessius’s seventeenth-century De justitia et jure (Hayek Reference Hayek1978, p. 256).
Hayek believed that by asking the right questions, Mandeville had made it abundantly clear that orders formed without deliberate design, even though “in no case did he precisely show how an order formed itself without design” (Hayek Reference Hayek1978, p. 251). Like his satirical contemporaries, such as Defoe and Swift, alongside their predecessor Desiderius Erasmus, Mandeville’s exaggeration of human failings shocked readers into an awareness of those failings to make people realize how society was based on mankind’s imperfections. Mandeville’s influential “definitive breakthrough in modern thought” (Hayek Reference Hayek1978, p. 25), in which he formulated an original theory of how society developed, using the allegorical format of the bee and its hive, was underpinned by his seminal development and defence of his paradox that man’s natural imperfection ultimately benefits society.
Furthermore, I consider Mandeville’s beehive of spontaneous orders as one of the key pillars of Hayek’s theory of spontaneous order, which he developed with assistance from the respective Mandeville studies of both Sakmann and Schatz. During the tercentenary of Mandeville’s Fable of the Bees, in my opinion, Kaye’s assertion that his book “had an extraordinary effect on the history of thought” (Kaye Reference Kaye1922, p. 83) remains a valid assertion.
Hayek, in turn, was influenced by both Sakmann’s and Schatz’s Mandeville studies, notwithstanding that he considered Mandeville “probably never fully understood what was his main discovery” (Hayek Reference Hayek1978, p. 251).
One matter, though, is certain: Hayek’s telling his 1966 London audience that the significance of Mandeville’s eighteenth-century contribution qualifies him as a “master mind” (Hayek Reference Hayek1978, p. 264) is equally attributable to Hayek’s twentieth-century contribution to economic, political, and social science as well as to the history of economic thought and ideas.
