One of the more important thinkers in the realm of market liberalism was Nobel laureate Friedrich Hayek. He made some important remarks about the workings of markets that should be more widely discussed.

He said, “What a free society offers to the individual is much more than what he would be able to do if only he were free.” He also observed, “Civilization rests on the fact that we all benefit from knowledge which we do not possess.”

Both quotes emphasize different aspects of how liberal social orders work.

The talent, knowledge, and rights of others make all of us better off. It isn’t just about you or me but markets are a system of voluntary interactions that encompass all of us. The evolution from a juvenile to a mature understanding of liberalism parallels the growth from infancy to adulthood.

Infants are notorious for being very possessive. It’s all about what they want and only what they want with little thought for others.

Soon the child must become an adult, which meant they had to learn how to interact with others. They must give others the same rights and respect they claim for themselves. It goes from “me” oriented to “us” oriented.

But the “us” in question is not some forced collective as is found in dictatorships such as China, North Korea, or Russia. It is a web of voluntary interactions between consenting individuals where each, in acting to improve their own well-being also improves the well-being of others. As long as the interactions are freely chosen and not coerced each transaction must benefit everyone involved or it won’t happen.

This is what Hayek meant. That others know how to do things I don’t know how to do means I benefit from their existence provided our interactions are consenting. So I hire the electrician to do what I can’t. He buys food ultimately from farmers though he isn’t a farmer himself. Each of are free to interact and by so doing we each improve our own lives not at the expense of others, but to their benefit as well.

The thing about free markets is we have no idea where the beneficial ideas will come from. Progress can’t be centrally planned, but is spontaneous. Progress isn’t designed, it evolves. This means we have no idea what the next great idea will be, or where it will come from. This unpredictability is what fuels innovation, as individuals seek profit and, in the process, improve the collective well-being.

The use of freedom and knowledge by individuals is unpredictable. Attempts to select ‘winners’ is fraught with political corruption and is intrinsically flawed.

Consider Hamdi Ulukaya, a Kurdish refugee from Turkey, a country with a history of persecuting Kurds. Ulukaya, raised by dairy farmers, immigrated to the United States to pursue education. On his father’s advice, he began importing family-made cheese, which led to a successful cheese production business. Upon discovering an abandoned yogurt plant, Ulukaya purchased and revitalized it, reemploying the workforce and, within years, amassed a fortune, benefiting millions of customers, thousands of employees, and contributing generously to charity.

Similarly, in Scotland, Fraser Doherty, at 14 years old, utilized his grandmother’s recipe to produce and sell jam. Within years, he was a millionaire, providing employment, initiating new businesses, and supporting charitable causes.

No central planner could have envisioned the contributions of a Kurdish immigrant or a teenage entrepreneur, but the freedoms of a liberal society enabled their success.

Nelson Mandela said, “To be free is not merely to cast off one’s chains, but to live in a way that respects and enhances the freedom of others.” That fits well with what Hayek wrote. Enhancing the freedom of others doesn’t just make them better off, it makes all of us better off, and the best way to do this is through the freedom of the market and respect for individual rights.