Smart Process, Not Just Smart People

Don Boudreaux’s latest Pittsburgh Tribune-Review column is simply superb, echoing both Israel Kirzner and Deirdre McCloskey:

The undeniably smart Steve Jobs’ vision for an affordable smartphone was dazzlingly creative. But that vision would have amounted to zilch had not many other people been available to help make Jobs’ vision a reality. Some of these other people were also smart. Others were of only ordinary intelligence. And almost every one of them was a complete stranger to Jobs.

Yet somehow, they all cooperated with Jobs and with each other to create the iPhone.

What has not been around, unlike smart people, for tens of thousands of years is the smart process that encourages the globe-spanning cooperation that makes goods such as the smartphone possible.

As Don points out, this “smart process” is a market economy. This is the Kirznerian insight that a market is not a thing or a place. It is an ongoing, never-ending process. Or, as Kirzner described market competition, a discovery procedure. Don also alludes to Deirdre McCloskey’s insight that this smart process cannot work unless people let it. Public opinion has to value things like innovation and commerce, and not look down its nose at them. The more that people denigrate entrepreneurs, the fewer of them there will be — and that means no smart phones, no matter how many smart people there are.

Read the whole thing.

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