One of the major turning points in social and economic understanding emerged in the 1700s with the theory of social order without human design. Before the eighteenth century, most social theory presumed or took as a working assumption that human society had its origin and sustainability in the creation of social institutions through either “divine” intervention, or by human will and plan.
But in the 1700s, the idea of society as a spontaneous order that emerged out of the actions and interactions of multitudes of individuals, each pursuing their own self-interest, began to develop into a systematic and scientific theory of human association.
Economics Born from Spontaneous Order Insight
In addition, the theory of emergent spontaneous order demonstrated that though not created by intentional plan, the social order showed coordinating pattern, structure, and self-correcting potential that often was superior in it’s beneficial effects for promoting a betterment of the human condition than any purposeful creation or direction of social processes by government could have produced.
This, more than anything, can be said to be the beginning of the development of a science of economics – a systematic analysis of the processes of interpersonal coordination of multitudes of people’s actions within a market-based system of division of labor.
As Austrian economist, Friedrich A. Hayek, observed:
It was through asking how things would have developed if no deliberate actions of legislation had ever interfered that successively all the problems of social and particularly economic theory emerged. There can be little question that the author to whom more than any other this [development] is due was Bernard Mandeville.
Mandeville and The Fable of the Bees
Bernard Mandeville (1670-1733) was a Dutch medical doctor, who at an early age settled in London, and spent the rest of his life in Great Britain. In 1705, he published a poem called, The Grumbling Hive, or Knaves Turned Honest, which was then republished in 1714 under the title for which it is, now, famous in the history of social and economic ideas: The Fable of the Bees, or Private Vices, Public Benefits
In this work, Mandeville challenged some of the most time-honored and sacred ideas concerning social morality and religious ethics. Whether it is the ancient Greek philosophers, such as Plato and Aristotle, or the religious teachings of the Christian faith, one of the fundamental ethical postulates has been that self-interested conduct on the part of the individual is often morally wrong and potentially “sinful.”
The presumption has been that human conduct should relinquish self-interest, especially when it concerns material acquisitiveness and wealth, and instead focus on other-oriented sacrifice for one’s fellow men and the “glory of God.” Mandeville argued that it was precisely through men pursuing their material self-interest – including “greed” and human pleasure – that all improvements in society come about.
Pursuit of Self-Interest Generates Social Prosperity
In the poem, Mandeville imagines a hive of bees that copies in its every detail and activity everything seen in human society. Greed, selfishness, the pursuit of material profit and pleasure dominate everyone in their activities and in their conduct toward others.
No regard is shown for others in market conduct, with each one following their own defined self-interest for personal gain and enjoyment for the fulfillment of their earthly desires. Yet, out of these “vices” of materialistic self-interestedness comes industry, innovation, a mass of goods and services that generate a life of material and culture comfort and ease that benefit all, even though it was no one’s intention, design, or purpose.
Said Mandeville in The Fable of the Bees:
Vast Numbers thronged the fruitful Hive;
Yet those vast Numbers made ’em thrive;
Millions endeavouring to supply
Each other’s Lust and Vanity; . . .
As Sharpers, Parasites, Pimps, Players,
Pick-Pockets, Coiners, Quacks, Sooth-Sayers,
And all those, that, in Enmity
With down-right Working, cunningly
Convert to their own Use the Labor
Of their good-natur’d heedless Neighbor:
These were called Knaves; but, bar the Name,
The grave Industrious were the Same.
All Trades and Places knew some Cheat,
No Calling was without Deceit . . .
Thus every Part was full of Vice,
Yet the whole Mass a Paradise;
Flatter’d in Peace, and fear’d in Wars
They were th’Esteem of Foreigners,
And lavish of their Wealth and Lives,
The Balance of all other Hives.
Such were the Blessings of that State;
Their Crimes conspired to make ’em Great;
And Virtue, who from Politicks
Had learn’d a Thousand cunning Tricks,
Was, by their happy Influence,
Made Friends with Vice: And ever since
The worst of all the Multitude
Did something for the common Good.
The Root of Evil Avarice,
That damn’d ill-natur’d baneful Vice,
Was Slave to Prodigality,
That Noble Sin; whilst Luxury.
Employ’d a Million of the Poor,
And odious Pride a Million more
Envy it self, and Vanity
Were Ministers of Industry;
Their darling Folly, Fickleness
In Diet, Furniture, and Dress,
That strange, ridic’lous Vice, was made.
The very Wheel, that turn’d the Trade,
Thus Vice nursed Ingenuity,
Which join’d with Time; and Industry
Had carry’d Life’s Conveniences,
It’s real Pleasures, Comforts, Ease
To such a Height, the Very Poor
Lived Better than the Rich before; . . .
Material Selflessness Brings About Stagnation and Decay
Then, over night, all the “bees,” feeling their guilt in violating the moral code of selflessness and other-oriented behavior, renounce the pursuit of material pleasures. They start living simple, “moral” lives thinking nothing of themselves and their personal desires.
However, production stops, demand for goods fall, innovation and improvement disappear, and employments and work are gone. The society becomes stagnant, poor and culturally empty and backward. Explains Mandeville:
But all the Rogues cry’d brazenly,
Good Gods, Had we but Honesty! . . .
But Jove with Indignation mov’d,
At last in Anger swore, He’d rid
The bawling Hive of Fraud; and did.
The very Moment it departs,
And Honesty fills all their Hearts;
There shews ’em, like th’ Instructive Tree,
Those Crimes which they’re asham’d to see;
Which now in Silence they confess,
By blushing at their Ugliness . . .
But, Oh, ye Gods! What Consternation,
How vast and sudden was th’ Alteration!
In half an Hour, the Nation round,
Meat fell a Penny in the Pound.
The Mask Hypocrisy’s Flung Down
From the great Statesmen to the Clown; . . .
Now mind the glorious Hive, and see
How Honesty and Trade agree.
The Shew is gone, it thins apace;
And looks with quite another Face.
For ‘twas not only that They went,
But Multitudes that liv’d on them,
Were daily forced to do the same.
In vain to other Trades they’d lfy;
All were o’er-stock’d accordingly . . .
The building Trade is quite destroy’d
Artificers are not employ’d;
No Limner for his Art is fam’d
Stone-cutters, Carvers are not nam’d . . .
The haughty Chloe, to live Great,
Had made her Husband rob the State;
But now she sells her Furniture,
Which the Indies had been ransack’d for;
Contracts th’ expense Bill of Fare,
And wears her strong Suit a whole year.
The slight and fickle Age is past;
And Clothes, as well as Fashions, last . . .
As Pride and Luxury decrease,
So by degrees they leave the Seas.
Not Merchants now, but Companies
Remove whole Manufactories.
All Arts and Crafts neglected lie;
Content, the Bane of Industry,
Makes ‘em admire their homely Store,
And neither seek nor covet more.
Mandeville’s Moral: Self-Interest Creates Civilization
The “moral” that Mandeville drew from his tale was that prosperous, wealthy and great societies only arise from men’s self-interested desires, and that is what made for successful civilizations:
Then leave the Complaints; Fools only strive
To make a Great Honest Hive
T’enjoy the World’s conveniencies,
Be fam’d in War, yet live in Ease,
Without great Vices, is a vain
Utopia seated in the Brain.
Fraud, Luxury and Pride must live,
While we the benefits receive;
Hunger’s a dreadful plague, no doubt,
Yet who digest or thrives without?
Do we not owe the Growth of Wine
To the dry shabby crooked Vine?
Which, white its shoots neglected stood,
Chok’d other plants, and ran to wood;
But blest us with its noble Fruit,
As soon as it was tied and cut:
So Vice is beneficial found,
When it’s by Justice lopt and bound;
Nay, were the People would be great,
As necessary to the State,
As hunger is to make ‘em eat.
Bare Virtue can make Nations live
In splender; they, that would revive
A Golden Age. Must be as free,
For acorns, as for Honesty.
Bernard Mandeville’s poem was met with scathing criticism and ridicule. Critics were offended by his seeming rejection of a morality based on God’s word and the commonly shared beliefs among many members of society that self-sacrifice and renunciation of material improvement was the cornerstone of ethical conduct.
Mandeville Say Himself Sheading Light on the Human Condition
Yet, as far as Mandeville was concerned, he saw himself to be merely bringing out the reality of human nature, and the working of self-interest and incentives in society as the motivational basis for human association and the source of human progress and improvement.
As Mandeville said in one of his defenses of the poem:
After this I flatter myself to have demonstrated that neither the friendly qualities and kind affections that are natural to man, nor the real virtues he is capable of acquiring by reason and self-denial are the foundation of society;
But that what we call evil in this world, moral as well as natural, is the grand principle that makes us sociable creatures, the solid basis, the life and support of all trades and employments without exception;
That there we must look for the true origin of all arts and sciences, and that the moment evil ceases, the society must be spoiled if not totally dissolved.
The language that Mandeville chose to use aroused the anger and indignation and shock of many who first read The Fable of the Bees. The conman, the huckster, and even the everyday crook, were all part of the prosperous society, with its hustle and bustle.
Men pursuing their personal pleasures; everyone devising ways to serve and satisfy the material desires and demands of their neighbors as the means of acquiring the wealth to advance their own wants and fancies; these were all essential factors and human forces fostering innovation, ingenuity and industry, the cumulative outcome of which was the great wealth and wonders of a thriving society.
No one planned this material wealth or its accompanying cultural wonders. It emerged as the unintended outcomes of men left free to advance their own individual interests and inclinations. If you wanted one – prosperity and industry – you could not relinquish or extinguish the other – self-interested conduct in the attempt to fulfill earthly wants and pleasures – Mandeville insisted.
Mandeville as the Entrée to a Science of Society
As Ludwig von Mises explained, in Theory and History (1957):
Only in the Age of Enlightenment did some eminent philosophers . . .inaugurate a new social philosophy . . . They looked upon human events from the point of view of the ends aimed at by acting men, instead of from the point of view of the plans ascribed to God or nature . . .
Bernard Mandeville in his Fable of the Bees tried to discredit this [latter] doctrine. He pointed out that self-interest and the desire for material well-being, commonly stigmatized as vices, are in fact the incentives whose operation makes for welfare, prosperity, and civilization.
Certainly the wording Mandeville chose implied that “evil” and “vice” were the agents of human betterment, thus implying that immorality was essential to mankind’s progress. But nonetheless, as Joseph A. Schumpeter pointed out in Economic Doctrine and Method (1912), “Mandeville had given a grotesque form to a profound conception in his The Fable of the Bees, . . . In this form, however, is contained the best and most lucid presentation of the idea that selfish interest of the individual performs a social function in the economic sphere.”
Here, then, was the germ of an idea – self-interest and its beneficial though unplanned side effects – that would have profound influence and repercussions a few decades later in the hands of the Scottish Moral Philosophers.