The Use of Surveillance in Market Society

Originally published in Social Science Research Network

The concept of “surveillance capitalism” pervades debates about the politics and ethics of the digital technology industry that relies on extensive data collection about users. To justify her use of the term, as opposed to simply “capitalism,” Shoshana Zuboff emphasizes its supposed departure from Adam Smith’s and F.A. Hayek’s accounts of political economy, particularly Smith’s metaphor of the invisible hand and Hayek’s discussion of the knowledge problem. Hayek argued the market process was conducive to liberty because it enables social coordination while allowing individuals to pursue their independent ends using the tacit knowledge created through exchanges and communicated via prices. To assess Zuboff’s argument, I examine Hayek’s discussions of technological change, including advertising and communication technologies. I show how the market functions like a communications technology in Hayek's account. As such, it should be compared to other institutions that Hayek compares to machines or devices: democracy, the liberal state and Rule of Law, and money. Finally, I show how the diffusion of influence enabled by the liberal state and market process is the key to Hayek’s theory of the relationship between the market and freedom as exemplified by his refutation of John K. Galbraith’s critique of advertising.

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