Russ Roberts

Boudreaux on Law and Legislation

EconTalk Episode with Don Boudreaux
Hosted by Russ Roberts
Caplan on Discrimination and L... Boettke on Katrina and the Eco...

DonB.jpgDon Boudreaux of George Mason University talks about the fundamental principles of economics and civilization: spontaneous order and law. Drawing on volume one of Friedrich Hayek's classic, Law, Legislation and Liberty, Boudreaux talks about the distinction between law and legislation, the appropriate role of judges, and how the fulfillment of our expectations allows us to pursue our goals and dreams.

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Readings and Links related to this podcast

Podcast Readings
  • Cafe Hayek Don Boudreaux's blog (joint with Russ Roberts)
  • "The Reality of Markets", Russ Roberts, Library of Economics and Liberty, 2005. On the meaning of spontaneous order.
  • Law, Legislation, and Liberty: Rules and Order, by Friedrich Hayek, U. of Chicago Press, 1973. Vol. 1 of 3. Available at
  • "$50 iBooks Cause Stampede",, Aug. 16, 2005. The disorder that can occur when price is set below the market price.
  • "The Tradition of Spontaneous Order", Norman Barry, Literature of Liberty, 1982.
  • "The Use of Knowledge in Society", Friedrich A. Hayek, American Economic Review, 1945.
  • "Order Defined in the Process of Its Emergence", James M. Buchanan, Literature of Liberty, 1982. Also available at the Online Library of Liberty.
  • The Road to Serfdom, by Friedrich Hayek, U. of Chicago Press, 1944. Available at
  • Blog commentary, by Donald Luskin at The Conspiracy to Keep You Poor and Stupid, Jan. 17, 2007. On reading Buchanan's article, following up on this podcast.
  • Listening Guide for this podcast. Discussion questions for high school and up.
  • Highlights

    Podcast Highlights
    0:54Why is this book your [Boudreaux's] all-time non-fiction favorite? Distinction between law and legislation. Law itself can evolve unplanned from human actions in the same way as prices emerge.
    3:40Law, order, defined. Made vs. grown order, spontaneous, emergent, unplanned order. Adam Smith, famous quote: butcher, brewer, baker. "Kinds of Orders in Society" Hayek, 1962. No societal, articulable purpose is planned, but there is a high probability of achieving the abstract goal. Markets act as if they have a purpose, but no single seller or buyer controls the result. Bagel market example. "The market makes sure there are plenty of bagels" is an abstraction, an economic shorthand.
    13:19Jim Buchanan letter following up on Norman Barry article: We often talk about spontaneous order being the order that would have been brought about by an omniscient, central designer. But we only use that language because we look back on it afterwards that way. It didn't come about by central planner, and too much information would have been required by a central planner to make it happen. Yet we talk about it after the fact as if it came about by a central design. Necktie example.
    17:39Hayek, "Use of Knowledge in Society". Kinds of knowledge and information, price changes convey information of complexity and subtlety. Spontaneous order. Adam Ferguson: things that are the result of human action versus human design. Language itself is an example: To google is a verb but not by decree.
    23:00Housing price example: "Market value" of a house is not anyone's intention. It's an abstraction that emerges from private interactions under no individual's control. Prices reflect the market value, and market values reflect spontaneous order. Riots for underpriced goods! Role of uniqueness in competitive markets.
    28:34Law vs. Legislation: definitions. Legislation is consciously designed rules, enforced with threat of force. Law is emergent patterns of behavior that is incorporated into people's expectations. Law can be enforced but is often not enforced. Legislation sometimes codifies law. School cafeteria example. When you put your books down on a seat you reserve it, and that's observed by common expectation. Speed limits, black-letter law.
    35:09Lex Mercatoria--the law emergent, Mediterranean medieval roots. Sea-faring medieval merchants developed their own laws, rules, and courts because they needed quick resolutions to questions. They abided by these institutions because of reputation. The laws are part of today's commercial code, encodified since. Role of expectations in social interactions precedes codified law, including workplace, marriage: laws evolve according to expectations
    40:59"Judge-made law" (better term may be "judge-articulated law"), common law, jury system, judicial activisim. Judges discover the law. What does it mean when we describe what we think judges ought to do do vs. what judges actually do? What happens to expectations when judges act?
    51:28Having expectations met. Power of the rule of law is something we assume contributes to stability. We expect something virtuous when we form our expectations. Is enacting the virtue a matter of custom, law, legislation, enforcement, efficiency, morality? How are our expectations best enacted when we enter into a contract or agreemnt? Couter. Doorknobs expected when we buy a house.
    58:49"Ignorance of the law is no excuse" makes sense, but "Ignorance of legislation" makes no sense. Is it criminal to not read local legislation every month, week, or day?
    1:01:35pp. 106-7 of Hayek's Law, Legislation, and Liberty: "The main reason why it is so difficult to see that rules of conduct serve to enhance the certainty of expectations is that they do so not by determining a particular concrete state of things, but by determining only an abstract order which enables its members to derive from particulars known to them expectations that have a good chance of being correct...." What we want to achieve is a situtation in which our chances of satisfying our expectations are as high as possible. That may mean that many individuals will be disappointed, if we want the overall process and expectation to continue to match reality. Expectations are the subtle key.
    Mailbag (Time mark 1:08:28-1:13:27)
      Afterthought on the above conversation with Don Boudreaux: How difficult is it to keep up with the bewildering array of legislation? Here's a quote by Milton Friedman from an Oct. 1974 speech he gave to the business community:
        "... The number of laws is so great that I doubt that there is a man in this room, myself included, who could not be sent to prison if there were a sufficiently determined attempt by prosecutors to do it. There are laws we have all broken, not because we are not law-abiding, but because there are so many laws and so many that we don't know about."
      Time mark: 1:10:00. On Caplan on Discrimination and Labor Markets and Postrel on Style. Oliver from Germany asks: Do Europeans have a lower standard of living, as claimed by Caplan? Grouping together too many countries at once may not be helpful. Germany v. other European countries and the U.S. on cars, air conditioning, space, savings, and more when trying to understand standard of living.

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    COMMENTS (1 to date)
    Peter writes:

    I really enjoyed the podcast (although I found myself constantly rewinding my ipod to understand a lot of the thoughts). I am writing with a half smile because I was amazed when Don raised the example of cafeteria. To this day I think it is the height of selfish for people to 'jump the line' in such fashion; do people that employ that tactic of reserving a seat feel that they are more deserving of a seat than the peron ahead of them in line or that the person ahead of them was too stupid to think of it. You were both correct in your portrayl that there is such an expectation but I was disappointed in your subtle endorsement. (I know it is kind of silly but I do see it as an example of our rampant self-interest). Also, I am not sure a jury would rule in your favor ie. if they were like me...haha. Keep up the good work.

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