Hayek justified markets by dispersed knowledge, not happiness maximization

Evidence

Interestingly, here is where Hayek rejected the maximization of utility as the standard equilibrium concept in neoclassical economic theory. Markets don’t maximize happiness; rather, “the use of the market mechanism brings more of the dispersed knowledge of society into play than by any other [method]” (1967, 174). — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 2195

Categorization

• DEFINE: Distinguishes the knowledge argument from the standard welfare-maximization justification of markets — a core Hayekian concept.
• XREF: The epistemic/awareness justification of markets connects to the reader’s work on how markets function as information-processing systems. — connects to: Hayek grounded free-market economics in a theory of human ignorance — Angus Burgin, The Great Persuasion: Reinventing Free…, 278; Hayek grounded negative rights in utilitarian market efficiency, not natural law. — Quinn Slobodian, Globalists: The End of Empire and the…, 411; Hayek rejected utility maximization in favor of knowledge dispersion as the market’s justification — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 1926 (+16 more)