It’s not often that I come across truly novel ideas that pertain to economics and policy when I do these book reviews. Usually the authors, as brilliant as they may be, just apply established concepts in a new way or expand upon an earlier idea. I think Dr. Adrian Bejan’s latest work is in that rare category of truly new ideas because he isn’t an economist or a political scientist. He’s an actual scientist. An award-winning professor of physics who trained at MIT to be exact. In particular, he is credited for discovering what he calls the constructal law. Duke University states
“The constructal law is the law of physics that accounts for the phenomenon of evolution (configuration, form, design) throughout nature, inanimate flow systems and animate systems together.”
It applies to the manner in which things evolve to become more efficient and effective. As a law of physics, this implies that such a process is inherent to the way the universe operates. Bejan first discovered this law when he was investigating the best way to cool electronic components, where he noted that the best design was one that involved small paths leading to large ones. He noticed how it resembled designs found throughout nature, like tree roots, or a river delta, or a fracture in a solid object. He noticed that there is a natural law that governs how energy moves throughout a system.
“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.”
Everything in the universe, from trees to electrical wiring to the evolution of animals to human society, is shaped by the constructal law. In order for things to persist and survive, they must be free to adapt and optimize. That process often leads to similar results throughout all of nature.
What Does This Have To Do with Human Freedom and Economics?
Dr. Bejan was kind enough to send me his latest book Freedom and Evolution after reading my article comparing Communism to Capitalism. In the article, I talk about how capitalist reforms in communist countries like China and Vietnam drastically improved quality of life. My initial reaction was why is an influential physics professor so interested in my work about political economy? To which he explained that my observation about free markets vs authoritarian command control demonstrated how the Constructal Law applied to human society. That there is an optimal manner in which society can organize itself to evolve and progress. When society is free then it can make these necessary changes, but when it is not free it cannot. Because the constructal law is essentially a law of nature. That is why without economic and social freedom, societies are doomed to starvation and stagnation.
Think of it this way: In free-market capitalism people naturally organize themselves to become more efficient and productive; as the constructal law dictates all things in nature follow. That is why freer countries are far richer, healthier, and more technologically advanced than those that are not. Getting in the way of free markets is essentially getting in the way of nature.
Economies of Scale and Consolidation
Take the economic term economies of scale, which refers to how when businesses expand they tend to increase production while lowering cost. In other words, they become more efficient. This is a byproduct of free markets because this is generally the objective of any profit-motivated entity and if free to do so a business will take this path.
Bejan explains that
“Economies of scale is a physics phenomenon because it is universally present. It is biological, geophysical, human, and social realms. Its manifestation can be measured and evaluated in physical terms.”
He gives an example to explain how economies of scale can be seen in physics and not just in economics when he gives an example of water pipes. He states how it is more difficult for water to flow through two small pipes than one big pipe. The way to increase efficiency is to increase the scale of the pipe.
Likewise, imagine you are trying to manufacture cell phones. It would be far easier to make lots of cell phones if you had one large factory rather than trying to spread the production out over many small factories. All cell phone manufacturers have an innate desire to increase efficiency in this fashion, just like the water in the pipe, and will do so if they are free to make those decisions. Now imagine there is a socialist dictator in charge and things can only happen when he says it can. His policies impede the natural order by introducing a suboptimal design based on hubris and not reality. Society becomes less efficient and then we’re left with fewer cell phones. Not to mention they are lower quality and cost more.
Bejan also demonstrates how energy usage and economic activity are directly explained by the constructal law. He writes,
“Recent work based on the constructal law has shown that economic activity is closely related to the movement of all streams of society. The annual domestic economic activity of a country is proportional to the physical movement measured as the amount of fuel consumed annually with purpose in that country.”
For the most part, this seems like common sense. The more economic activity, the more fuel is needed. The more prosperous a society is the more energy it uses. However, this demonstrates how the constructal law governs nature and society. We are not free from these laws and it is not simply a conscious choice. Basic physics tells us that energy is needed to move an object. Society follows these rules as well.
Inequality is inherent to capitalism and a system of freedom more generally. If there isn’t a coercive central power keeping everybody down, some people will accumulate more than others whether that be wealth or prestige. However, inequality is also natural and explainable by physics. Bejan writes,
“Inequality is an alternative description of the non-uniform hierarchical distribution of movement on earth… Inequality has a negative connotation implying lack of justice, empathy, and access to wealth. This implication is in total contradiction with the origin of hierarchy, which is freedom of movement. The origin of hierarchy lies in the equal access that freedom provides to the whole, to morph its flow architecture, and to liberate as it flows.”
If there are two basketball players, me and LeBron James, to keep us at the same level is to prevent LeBron James from exercising his freedom to move above and beyond. It’s also unfair to people who enjoy watching good basketball not to let him do so. James goes to play in the NBA while I go write for AIER. We naturally fall into areas that we create unique value in. We all have different talents and skills that allow us to get to different places. Artificially trying to suppress achievement is not only immoral, it’s ignorant of reality. Although we may feel inequality is unjust, there is something even worse, in fact, unnatural about trying to make people equal by force.
Bejan provides a famous Russian story to demonstrate this idea when he writes,
“There are two poor neighbors in a village. One has a goat, the other has none. The envious man kills his neighbor’s goat. Both men feel injustice, but it is not the same.”
Freedom and Prosperity
The great economist, Deirdre McCloskey, writes extensively about The Great Enrichment, which is a time period of rapid economic growth and improving living standards. It began around the Dutch Revolt, which introduced the contemporary ideas of a free society and still continues today. The reason why societies got exponentially wealthier is because when free individuals were able to make decisions for themselves that optimized personal well-being, that led to collective well-being. That is why there is an observed correlation between freedom and prosperity to this day. That is the economic explanation behind why the world suddenly got far richer than it used to be.
Bejan notes that physics also explains the correlation between freedom and prosperity. He writes,
“The allocation of more power to more individuals is knowledge, which represents the design changes that keep us alive and flowing easier, moving farther, and lasting longer in time. Collaboration means working together, organization, life. With freedom, the flowing entities are free to exchange. They move to the right, and then to the left, and find better ways of flowing.”
If you think about how the free market works it follows the constructal law in that it is chaotic yet naturally self-optimizing as all things in nature are. Think of how we get our groceries through a chaotic network of supply chains, brands, grocery stores, and so on. At the end of the day, all the products are neatly shelved for you to buy. This is how freedom works and physics explains this idea in a similar manner that economics does. Going back to the constructal law, think about how a tree grows. Its branches twist every which way and it may seem chaotic, but if you just let it do its thing, it will grow into a powerful tree. That is because the constructal law dictates that things must evolve in a manner that optimizes efficiency. Optimal food distribution and much more is possible because of the free market, not the design of a dictator. That is why every Communist society has been relegated to starvation and freer societies have more to eat than those that are less free. It’s not just basic economics, it’s physics.
Who would have thought that with the pantheon of great economists and philosophers that exists today, one of the most innovative and provocative defenses of individual liberty came from a physics professor?
I always liked to say that I believe in freedom not just because it’s the most moral system or produces the most wealth for the most people, but because scientifically it leads to the best results. I arrived at that conclusion through an economic and historical analysis but I didn’t know it was explicitly supported by actual science. Specifically, the constructal law.
Bejan’s book shows that freedom is actually scientifically good for society. It truly is a groundbreaking fusion of physics and economics. Bejan isn’t a political philosopher or an economist; he’s just a scientist charting out the laws of physics and nature. However, his thoughts are actually pretty similar to the Austrian School of Economics which employs praxeology, or a theory of human action. In his case, he sees things through the lens of energy movement and evolution, the literal workings of the universe. Economists call prosperity the result of free people and free markets. He calls it a force of nature.