Hence, general welfare is achieved, not via the realisation of allocatively efficient statesas put forward by neoclassical thought, but through a process of market discoverybased on competition.On this basis, Austrian economists, as a rule, are opposed to normative prescriptionssince they are likely to impede the process of economic co-ordination. This happensbecause, as Austrians emphasise, social institutions, among them markets, are the resultof human action rather than of human design. Thus, regulatory failures, in the view ofthe Austrians, are the result of using law for specific instrumental purposes, when this,in the words of HAYEK, is merely asypnotic delusion, that is the fiction that all the relevant facts are known tosome one mind, and that it is possible to construct from this knowledge of theparticulars a desirable social order. (HAYEK, 1973-79: Vol. 1, 14).Hence, as OGUSpoints out,the centralized pool of information on which rulers must rely for regulatorymeasures could never replicate the widely dispersed fragments of knowledgewhich individuals use in pursuance of their own ends and therefore could neverbe adequate to anticipate all the variety of circumstances to which specificregulations must be applied. (OGUS, 1994: 57).Let us examine in more detail the relation between the law and the economy under thework of Professor Friedrich Hayek, the leader of this school of thought.18.104.22.168. Hayek s theory of market orderThe market or catallaxy, in Hayek s language, is a type of order in the sense of being astate of affairs in which a multiplicity of elements of various kinds are so relatedto each other that we may learn from our acquaintance with some spatial ortemporal part of the whole to form correct expectations concerning the rest, orat least expectations which have a good chance of proving correct. (HAYEK,1973-79: vol. 1, 36).
190PUBLICATIONTHEORIESOFREGULATIONMore specifically, the market is a special kind of spontaneous order , or cosmos, asopposed to a made or imposed order, taxis.As a spontaneous order, the market isan endogenous order, a self-generating order, whose equilibrium is set from within; it isan order that consists ofa system of abstract relations between elements which are also defined only byabstract properties, and for this reason will not be intuitively perceivable and notrecognizable except on the basis of a theory accounting for [its] character. (ibid.: vol. 1, 39).It is also an order not made by humans, though a product of the action of many agents;not being made, the market order cannot legitimately be said to have a particular purpose.By contrast, taxis is an exogenous order, artificially established, often concrete, in thesense that it can be perceived by inspection, and having been deliberately made, itinvariably serves a purpose of the maker29.