Markets and family values

Larry Arnhart’s recent post at Darwinian Conservatism makes a couple of interesting points on family values and classical liberalism. The piece is largely a response to Geoffrey Hodgson’s claim that a market individualist cannot support family values:

“Generally, if contract and trade are always the best way of organising matters, then many functions that are traditionally organised in a different manner should become commercialized . . . Pushed to the limit, market individualism implies the commercialization of sex and the abolition of the family. A consistent market individualist cannot be a devotee of ‘family values’ . . . They cannot in one breath argue that the market is the best way of ordering all socio-economic activities, and then deny it in another. If they cherish family values, then they have to recognise the practical and moral limits of the market imperatives and pecuniary exchange”

I am perplexed when claims such as these are made. Where are the people claiming that the market is the best way to organise all socio-economic activities? The more usual claim is that people should be able to do as they choose – with the expectation that the innate tendency to form families will dominate in some spheres, the spontaneous order of the market in others.

Arnhart quotes Hayek to point out that the tension between markets and family has not been missed by classical liberals:

It is important, then, Hayek explains, that we neither apply the rules of the market to family life nor apply the rules of family life to the market. “If we were to apply the unmodified, uncurbed, rules of the micro-cosmos (i.e., of the small band or troop, or of, say, our families) to the macro-cosmos (our wider civilization), as our instincts and sentimental yearnings often make us wish to do, we woud destroy it. Yet if we were always to apply the rules of the extended order to our more intimate groupings, we would crush them. So we must learn to live in two sorts of world at once”

Arnhart takes Hayeks’ argument further, and suggests that the existence of these two worlds points to the need for the family as an institution:

As Horwitz indicates, Hayek’s idea of “living in two worlds at once” points to the need for the family as an institution in which children can learn the moral rules for both the micro world of face-to-face interactions and the macro world of anonymous interactions in the extended spontaneous order of society.

The Hayekian insight is that families are best situated to do this because of their advantage in knowledge and incentives. The intimacy of the family allows parents to have an intimate knowledge of each child’s individual character and situation that allow parents to teach them their social lessons–by both explicit instruction and implicit example–in a manner that is suitable for the individual child. … No extended order of spontaneous cooperation could provide either the knowledge or the incentives that arise within the intimate experience of families.

I would use a weaker word than “need”. The lack of influence that parents have on child outcomes outside of their genetic contribution suggests that children are relatively robust to the arrangement in which they are raised. However, the innate tendency to form and operate in families suggests that families are valued – and will continue to form.

Arnhart’s closing paragraph is interesting.

We might also notice that this special role of the family in transmitting social learning about how best to succeed in society could explain the great transformation that came with the Industrial Revolution. If we accept Gregory Clark’s argument about the importance of an evolutionary process of “survival of the richest” by which families that taught their children the bourgeois virtues were more successful in England in the 18th century, which led to the Industrial Revolution, then we could explain this great transition into Hayek’s Great Society as a product of an evolutionary transformation in family life.

How much of the transmission was by families and how much by genes? Clark seems to lean towards the latter.