...“Emergent order,” also known as “spontaneous order” or “self-organization,” results from the interactions between individual components or members of a network in which each member both receives and transmits information that causes other members to alter their behavior according to a set of rules....
Emergent orders exist in physical, biological, and social systems or networks. In his book National Economic Planning: What Is Left?, the late Austrian economist Don Lavoie used a termite nest to illustrate emergent order in biological systems....
A free market is an example of emergent order within a society. In a free market, individual actors work to improve their own and their families’ material and nonmaterial well-being (as they define them) and, as long as they follow a few simple rules — don’t steal, don’t cheat, don’t coerce — they benefit other members of society in the process. People in a market communicate via prices, which both influence and are influenced by their actions. Prices reflect the subjective and ever-changing values that millions of people place on the various goods and services exchanged in the market.
The order that emerges from simple free market rules is amazingly complex, resilient, and efficient....
A central plan can only disrupt the spontaneous order. Just as artificially introducing pheromones into a termite nest or blocking termites’ ability to either produce or detect the chemicals would disrupt — and possibly destroy — a termite colony, altering or eliminating price signals will disrupt or destroy an economy....
Emergent disorder is not confined to dictatorships. In the United States, disorder emerges when the nation’s currency is manipulated — distorting prices and price signals — and when regulations force people to ignore market rules....
Order emerges spontaneously in free market systems. But distort or eliminate prices or block communication channels, and it is not order but disorder that will emerge.