Seminar - Two Roads to Serfdom: Rules, Commitment, and the Logic of Liberal Order

Modern political economy rests on a fragile premise: that self-interested actors, governed by well-designed rules and incentives, can sustain social order. This model endures only because standard theory fails to take innovation seriously. Once we recognise societies as open-ended systems in perpetual strategic flux, the conventional account collapses: it is a logical impossibility. Liberal democracy is itself subject to Schumpeter’s creative destruction, and a purely institutional response cannot save it.

I present a general theory of social order under innovation. It shows that durable social orders, among humans as in biological systems, depend on the interplay between adaptive rules and commitment -- an intrinsic concern for the common good that no system of incentives can manufacture. In this, it returns political economy to the insights of Adam Smith.

The framework reframes foundational questions of economic governance, democracy, and institutional decay. It clarifies contemporary regulatory failures; explains why central planning, libertarianism, and other fixed doctrines are fatal conceits; and resolves long-standing paradoxes in rational-choice democracy. It also offers a blueprint for renewal: to rebuild markets, professions, and democracies as trust-building machines -- systems capable of both innovation and endurance.

Reuben Finighan is Research Lead in Economic Pathways at the Superpower Institute. Reuben holds a PhD in Political Economy from the London School of Economics and a Masters of Public Policy from the Harvard Kennedy School, as a Fulbright, Frank Knox, John Monash, and Leverhulme scholar. He has co-authored papers with Harvard Professor Robert Putnam, Ross Garnaut AC, and Lord Nicholas Stern, and previously worked at the University of Melbourne in applied economics and as Chief Economist for the Universal Commons.

Light lunch will be served.