The central interest of my research has always been the issue of knowledge. I am convinced that across a wide range of issues, contemporary thinking is fundamentally off-target in its understanding of knowing. It misunderstands the processes by which human beings acquire, invent, and share knowledge, which its conceives as a static, individualistic, and objective thing. It misses what one might call the internal dependence of knowing on inarticulate skills as well as the external dependence of knowing on social processes.
My work in the field of comparative economic systems has been focused on elaborating the knowledge issues in the Critique of Centralized Economic Planning. I claim that Marx properly saw the incompatibility of economic planning and market institutions, but never understood the way markets serve a vital knowledge-discovery and communication function in complex economic systems. Less extreme proponents of economic planning imagine the possibility of controlling the market process, that is, getting the benefits of markets without letting them work in their own uncontrollable directions. Marx was right, effective markets and the active steering of the economic process don’t mix. Once we concede the need for markets we need to abandon the aspiration for control over the economy.
Everything important about this critique of central economic planning turns on the issue of knowledge. In the classic argument about planning the reason Oskar Lange and the other market socialists disagreed with Mises and Hayek was rooted in their different epistemological assumptions. The reason contemporary advocates of some form of national planning disagree with contemporary critics of economic planning lies in their different assumptions about knowledge.
My own work on the nature of knowledge and knowing has been primarily inspired by two economists, Ludwig Mises and Friedrich A. Hayek, and two philosophers, Michael Polanyi and Hans-Georg Gadamer, though it is admittedly complicated by a smattering of strange influences from all sorts of other directions, from software engineering to literary criticism, from political theory to biology. But basically for me, Austrian economics and hermeneutical philosophy, especially when taken together, are enough to constitute an extraordinarily attractive point of view, and in my own research I am mainly just trying to sum up and clarify what I learn from these two traditions. They show me that much of what is taken for granted in the theory of knowledge is wrong, and dangerously wrong. Human knowing is misunderstood at so fundamental a level that it infects all of our language, so that we find it very difficult to hit upon the words that can re-orient ourselves.
The same misunderstandings of the nature of knowing that led otherwise intelligent people to believe that the centralized economic planning of an entire national economy was a plausible idea, also have their repercussions in the field of methodology. They’ve resulted in methods that represent a deterioration of scholarly standards and of the relevance of much social scientific research. My work in the Philosophy of Economics and Social Thought has been focused on elaborating the perspective on knowledge that comes from people like Hayek, Polanyi, and Gadamer and applying it to issues in the methodology of economics and the other social sciences. Given the nature of knowledge that comes from these thinkers, much of the activity of contemporary economic scholarship seems utterly misplaced. Knowledge is deeply rooted in the tacit dimension and in the social dimension in ways mainstream economics and much social thought seem to deny.
One way to sum up this Austrian/hermeneutical theory of knowledge is to say that what an individual knows is both more and less than what he or she can explicitly say. It is more in that the words spoken/written mean different things to different listeners/readers, such that there is creative learning involved in human communication. It is less in that we always sense that there is more underlying what we say than we can ever bring to expression in words. Human conversation involves a spontaneous order, or interplay among the perspectives such that nobody can be said to control the process. Markets are best seen as an extension of linguistic communication, and one which is similarly able to work best when we do not try to gain direct control over it.
Understanding the tacit and social dimension of human knowing helps us to use our knowledge more effectively and to cultivate learning. My third area of research, the study of Technologies for Collaborative Learning, is aimed at investigating ways of improving the use of knowledge in organizations. I am especially interested in hypertext tools and their potential ability to improve interpersonal communication, and in groupware environments, that can help an organization to manage work-flow and knowledge sharing in ways that can directly contribute to the bottom line.
I see knowing as a spontaneous order process, a kind of dialogical process of tugging and pulling which — under some circumstances — can yield what might be called a social learning process. It involves both an empathetic effort to really listen to the truth claims of the other, and a critical effort to come to grips with the real differences in another point of view. It involves attempting to “come to terms” with one another. The process of mutual criticism in the arts and sciences, as well as the process of collaboration and competition in the market, can, in the appropriate conditions, sustain a powerful learning process. There is an unplannable but valuable learning involved in the discovery process of a conversation or of a competitive market. I understand this kind dialogue process to be operating in many different domains, from verbal conversation to the market process, from the reading of texts to the interpretation of music.
Donald C. Lavoie 