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POLITICAL STUDIES: 2003 VOL 51, 722–739
Hayekian Political Economy and the
Limits of Deliberative Democracy
Mark Pennington
Queen Mary, University of London
Inspired by Habermasian critiques of liberalism, supporters of deliberative democracy seek an
extension of social democratic institutions to further a reinvigorated communicative rationality
against the ‘atomism’ of market processes. This paper offers a critique of deliberative democratic
theory from a Hayekian perspective. For Hayek, the case against the social democratic state rests
with the superior capacity of markets to extend communicative rationality beyond the realm of
verbal discourse.
One of the charges most frequently levelled at liberalism by the social democratic
left is that, by treating individuals as isolated ‘atoms’, it fails to recognise the com-
municative significance of the social settings in which individual ‘selves’ are shaped
and created. From the rational egoists of social contract theory, to the utility
maximisers of modern neo-classical economics, liberal political economy, argue the
critics, is concerned primarily with the organisation of rational self-interest to the
neglect of examining from where the ‘rational self’ derives. As evidenced by recent
issues of Political Studies, a contemporary manifestation of this critique is expounded
in the Habermasian advocacy of ‘deliberative democracy’ (see, for example, Smith
and Wales, 2000).
In this paper, I take issue with the normative claims of Habermasian theory,
arguing that its critiques of liberal institutions and of the market economy in
particular may be misconceived. Having sketched the primary arguments of the
deliberative democrats, I show that, far from neglecting the communicative
function of social institutions, th
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