The Road to Serfdom and the Definitions of Socialism, Planning, and the Welfare State, 1930–1950

Abstract

There is a long-standing debate about whether the central hypothesis of F. A. Hayek's The Road to Serfdom, warning of the incompatibility between socialism and democracy, extended to welfare states. The empirical validity of Hayek's hypothesis hinges on his definition of socialism. We build on previous works contextualizing and interpreting The Road to Serfdom by examining the common definitions of socialism, capitalism, and the welfare state primarily between 1930 and 1950 according to (1) socialist intellectuals, especially those Hayek was engaging in The Road to Serfdom, (2) reviews of and responses to Hayek's book, and (3) prominent politicians and other public intellectuals in London. We find that socialism was commonly understood to mean economic planning under state ownership or control of the means of production. Those advocating for the expansion of welfare programs often held that state control or ownership of the means of production was necessary to fund social redistribution. Our findings bolster the interpretation of Hayek's central hypothesis in The Road to Serfdom as being limited to economic planning under state control or ownership of the means of production.