On this episode of the Authors Corner, Ethan speaks with Dr. Adrian Bejan on his book Freedom and Evolution: Hierarchy in Nature, Society, and Science. Dr. Bejan, unlike most of the guests on the show, is not an economist or even remotely related to the field of humanities or social sciences. He is in fact an award-winning physicist and the J.A. Jones Distinguished Professor of Mechanical Engineering at Duke University. He received all three of his degrees, from his B.A. to his Ph.D., from MIT, and according to his Wikipedia page, he even played on the Romanian National Basketball team. His major contribution to physics includes discovering the Constructal Law, which states,
“For a finite-size system to persist in time (to live), it must evolve in such a way that it provides easier access to the imposed currents that flow through it.”
In other words, all matter and systems in the universe have a tendency to naturally evolve to become more efficient. His book outlines a novel application of the law to explain social scientific phenomena, such as why societies tend to perform better when they are free, why hierarchies naturally develop, and why energy usage increases as economies grow.
The context for the interview was rather interesting. Dr. Bejan contacted Ethan after reading his article exploring market reforms in China and Vietnam, which concluded that both these post-Communist nations are doing far better after liberalization. He asserted that this observation alongside other examples and points supported his latest application of the Constructal Law to social science. That is that free societies outperform unfree societies precisely because everything must follow the laws of physics. In this sense, human civilization, just like all things living and inanimate, has a natural tendency to evolve to become more efficient. Human beings, just like all living things, would like to find the most optimal way of performing an activity while improving their well-being. Maximize utility, minimize costs. Therefore, a society that allows its people to have freedom will also allow its people to undergo these natural tendencies to improve and optimize. The best thing governments can do to facilitate this is to prevent their people from being oppressed by each other, by themselves, or by foreign threats.
This is further supported by any economic or human freedom index where there is a strong correlation between liberty and prosperity. From a social sciences perspective, this is rather intuitive because people are naturally inclined to improve their situation and contribute to society if the incentives are aligned correctly. Oppressing or excluding certain groups or the entire population suppresses otherwise beneficial activity. Take the starting premise that people are more productive when they are not locked in a cage. If you accept that, then you can infer that therefore, people are more productive when they are able to freely express themselves and engage in entrepreneurial activities without overbearing regulation.
Some concrete examples Dr. Bejan cites are the relationship between economies of scale and water flowing through a pipe, which both follow the Constructal Law. The law applies to water in the sense that one large pipe can transport more water than two smaller pipes. That is because the larger pipe can allow the water to condense, as the water has a natural tendency to find the most efficient way of traveling. Similarly, with economies of scale, which refers to how production becomes more efficient when a business expands, the same dynamic is at play. Two smaller businesses are not as efficient as one large business. Economic actors have a natural and productive desire to seek growth in this fashion, which can occur either through physically expanding the firm or merging with another. The natural tendency of businesses, much like water and other forms of matter in the universe, is to move towards a more efficient system, which in this case is through consolidation.
There is no need for a central planner to tell businesses that they could be more efficient if they were under one roof instead of two, or three. Self-interested and rational actors will observe this and naturally seek to do so on their own. In fact, an overly restrictive government prevents this natural process from occurring. If you look at society at its most basic level, which is as a system with inputs and outputs, then this analogy is even more apparent.
This idea can be applied to many other areas besides economies of scale. If you’re running a town, will you get better results if you allow people to engage in free association and enterprise or would it be better to try to micromanage everyones’ lives? Even though it may seem tempting to try to micromanage, simply setting basic ground rules and allowing people to live free lives allows the most preferences to be realized by the most people.
Nobody needs to tell the coffee shops what to serve, the butcher what to sell, the shoemaker how much to order, etc. In fact, societies that try to do that, like the former Soviet Union or Maoist China, tend to not only be poorer but also incredibly drab. In the seemingly chaotic and free West, not only do people live more prosperous lives, but the world is more colorful and diverse. That is because there is a natural and self-optimizing order that emerges based on the forces at play in the universe. From an economic perspective, this was articulated by Nobel Prize-winning economists like Friedrich Hayek with his refutation of central planning alongside his defense of the spontaneous order. Richard Epstein, one of the most influential living legal experts, further articulated this notion in his defense of simple rules in an increasingly complex world. Now we can seek to understand this phenomenon from a hard scientific perspective, thanks to the work of the Franklin Prize-winning physicist, Dr. Adrian Bejan.