Critical rationalism and institutional change in Hayek

Abstract

ABSTRACT The institutional analysis promoted by F. A. Hayek seeks to understand how human action and coordination among individuals occur in an environment where the knowledge held by each person is incomplete and not fully transmittable. In such an environment, the institutional framework plays an important role in conditioning, at least partially, the behavior of members within a spontaneously emerging social order. In light of this, the objective of this article is to present Hayek’s evolutionary institutional approach by organizing the discussion proposed by the Austrian economist on the subject. To do so, it will discuss Hayek’s distinction between critical rationalism and constructivist rationalism. It will also address Hayek’s explanation of institutional change and delve into his evolutionary approach to the social sciences, as opposed to the natural sciences.

Keywords

• F. A. Hayek
• institutions
• evolution