A Note From the Author
A NOTE FROM THE AUTHOR
The variety and availability of bread at decent prices in cities around the world is an example of emergent order, order that emerges from the decisions and actions of individuals that no one of those individuals intends.
Emergent order doesn’t mean there is anarchy. The government’s legal system and public infrastructure underpin the process that allows the interactions between buyers and sellers to create the order that feeds the citizens of a great city. But there is no bread czar. No minister of flour. No wizard of wheat. Yet, somehow, my desire for rye doesn’t stop you from getting whole wheat. Your desire for whole wheat doesn’t make life hard for the pizza lover. And there is beer made from the same grain to go with the pizza if you want it. The harmony of our daily lives happens without anyone being in control of the overall outcomes.
It would be something of a miracle if such a bottom-up system, undesigned and unplanned by any human hand to achieve the ends it actually achieves, could do anything nearly as well as a system designed from the top down to achieve the same results. Yet something crazier is the case—the bottom-up system often outperforms the top-down system. Of course this isn't a general rule—there are many results where a top-down approach is necessary to achieve a desired outcome. Think of national defense or pollution control for example. But that uncoordinated specialization and cooperation can emerge to satisfy the hunger of millions without centralized control has been a source of wonder going back to at least Adam Smith and his contemporaries.
The economist’s short-hand phrase for this phenomenon of bread being plentiful throughout a populous city is “the market for bread,” represented by a supply and demand diagram. While this representation is inevitably a crude simplification, it can help us understand the ways in which the price and quantity of bread respond to changes in the desires of buyers and the constraints facing sellers. Supply and demand can also help us understand the effects of various government policies—price controls, taxes, subsidies. This blackboard approach to emergent order has the great attractiveness of simplicity. There is much to learn from it. But it fails to capture the full richness of the process.
“It’s a Wonderful Loaf” is my attempt to capture some of what is magical about bread and other examples of emergent order. Many of the resources are found embedded in the annotated text of the poem. In this annotations you will find essays, books, videos and podcasts to continue the exploration for those who want to go deeper into the idea of emergent order and its application to economics . Enjoy.
I would like to thank John Papola for inspiration and Don Boudreaux for hours of conversation about emergent order. Much gratitude to Jerry van de Beek and Betsy De Fries of Little Fluffy Clouds for their amazing animation. This project couldn’t have happened without the help, humor, and professionalism of my Hoover colleagues, Chris Dauer and Shana Farley who have shepherded this project (and me) from the beginning. I especially want to thank Chris for his wisdom and Shana for her creativity and devotion to excellence.
- Russ Roberts