What Is The "Fatal Conceit?"

As coined by Friedrich Hayek, 20th century economic philosopher, the "Fatal Conceit" is the thought that a small group of people can do a better job at directing or planning an economy than an unstructured larger group, know as a market and driven by what looks like chaos. Discussion hereand here.

In The Fatal Conceit, the Nobel laureate economist F.A. Hayek writes of the key ideological conflict in economics. On the one hand are "the advocates of the spontaneous extended human order created by a competitive market," and on the other hand, "those who demand a deliberate arrangement of human interaction by central authority based on collective command over available resources."

What has failed is the latter, collectivism--the "fatal conceit" that says that a single mind, a single committee, can somehow do things better than the spontaneous, unstructured, complex, and creative forces of the market.

Just have a look at the Koreas. South Korea per capita GDP is around 15 times that of North Korea. South Korea has its flaws but is obviously more free economically than North Korea. The people in both come from the same economic and social background just have differences in freedoms, both economic and social.