Vikash Yadav, Liberalism’s Last Man: Hayek in the Age of Political Capitalism. University of Chicago Press, 2023. 

Imagine sitting down with a cup of your favorite herbal tea, ready to dive into a dialogue on the relevance of Hayek for the current world. This is the essence of Vikash Yadav’s Liberalism’s Last Man: Hayek in the Age of Political Capitalism.

In the book, Vikash Yadav re-examines Friedrich Hayek’s The Road to Serfdom with a lens sharply focused on today’s geopolitical landscape with the emergence of “political capitalism” in states like China, Vietnam, and Singapore. Following Milanovic (2019), Yadav defines political capitalism as an alternative form of capitalism associated with efficient technocratic bureaucracy, absence of the rule of law, and state autonomy in matters of private capital and civil society (p. 2). The tremendous economic performance exhibited by these states asks us to ponder deeply on what liberalism means when economies grow but freedoms stagnate.

The book is segmented into chapters that each focus on a specific aspect of Hayek’s seminal work, “The Road to Serfdom,” recontextualizing Hayek’s ideas for the 21st century. Each chapter begins with an examination of Hayek’s epigraphs, offering insights into the broader conversation about liberalism that Hayek engages with, before delving into summaries, critiques, and extensions of Hayek’s arguments. The author, Vikash Yadav, aligns his discussion with current geopolitical and economic developments, notably the rise of political capitalism in East Asia, and the transformation within liberal polities.

Ideological Echoes: From Socialism to Political Capitalism

Yadav’s exploration hinges on Hayek’s insight that the “prestige of ideas” plays a crucial role in economic development. This perspective underscores the imperative for liberals to scrutinize the ideological underpinnings of political capitalism in East Asia. Yadav connects Hayek’s analysis of socialism’s ideological origins to the contemporary growth of political capitalism, emerging as an intellectual rival to liberalism in the 21st century.

He highlights how socialism’s elevation of “economic freedom” above “political freedom” mirrors political capitalism’s tendency to deprioritize human and civil rights in favor of economic rights, such as the right to subsistence or development. This parallel frames political capitalism as a continuation of collectivist ideologies, emphasizing centralized planning and economic over political liberties.

However, Yadav’s discussion, though rich in its engagement with Hayek’s critique of socialism and collectivism, leaves a gap in its examination of political capitalism in its various manifestations across East Asia. While acknowledging socialism’s influence on political capitalism’s devaluation of certain freedoms, Yadav stops short of delving into the diverse ideological sources that feed political capitalism’s growth and its intellectual appeal.

Yadav’s analysis might not capture the full complexity of governance in authoritarian-capitalist regimes like Singapore and China. Singapore’s robust justice administration and transparency highlight its governance strengths, despite restrictions on free speech. China’s fiscal decentralization, allowing local economic autonomy, contradicts the narrative of absolute central control. These examples blur the lines between political capitalism and liberalism, showing a multifaceted blend of both ideologies that extends beyond economics to achieve effective governance and public satisfaction.

Navigating the Environmental Maze: Policy, Knowledge, and Action

In chapter 3 (pg 57), Yadav quotes Hayek:

“To prohibit the use of certain poisonous substances or to require special precautions in their use, to limit working hours or to require certain sanitary arrangements, is fully compatible with the preservation of competition. The only question here is whether in the particular instance the advantages gained are greater than the social costs which they impose. Nor is the preservation of competition incompatible with an extensive system of social services—so long as the organization of these services is not designed in such a way as to make competition ineffective over wide fields.”

Yadav interprets it as “environmental (or health and safety) regulations applied equally to all manufacturers are consistent with the promotion of competition, unless they are actually designed to render competition ineffective.”

The distinction between preserving and promoting competition is crucial in Hayek’s economic philosophy. Preserving competition aligns with Hayek’s view of setting fair rules that apply equally, without distorting market signals. Promoting competition implies a more active government role, potentially nudging markets in certain directions, which could risk unintended consequences Hayek warned against. Yadav’s usage of these terms necessitates clarity on whether Hayek advocated for actively promoting competition through interventions like environmental regulation, and if so, how that could be reconciled with Hayekian principles while minimizing market distortions. This would require a nuanced justification, exploring scenarios where government interventions do not merely level the playing field but actively encourage competitive dynamics in a way that benefits society and the economy without compromising the market’s integrity.

Role of State in Handling Wicked Problems

The assumption that the government can accurately gauge and balance environmental and economic trade-offs oversimplifies the complexity of ecological systems and economic interactions. The dispersed and context-specific knowledge held by individuals and local entities is crucial for effective environmental stewardship, which might be overlooked or underutilized in a top-down regulatory framework (Sagoff 2021).

The reliance on government to set emission caps and facilitate the creation of a market for tradable permits might be critiqued for potentially underestimating the challenges in establishing a fair and efficient market (p.107). Issues such as determining the initial allocation of permits, preventing market manipulation, and ensuring the integrity of the market mechanism could prove to be significant obstacles.

The dynamic and uncertain nature of climate science and economic impacts necessitates adaptive, localized responses rather than a rigid, centralized approach. Climate change is a wicked problem involving interdependencies, uncertainties, and varying stakeholder values, requiring nuanced, context-sensitive responses that acknowledge and integrate uncomfortable knowledge (Rayner 2012).

Yadav rightly points out that environmental critiques often misdirect their focus from the real issue of captured interests. However, Yadav should have explored some historical examples to illustrate how liberalism could counter the influence of vested interests.

Closer Look at State Intervention: When Hayek Says Yes

Yadav refers to Hayek’s acceptance of state intervention in cases where competition is ineffective or the costs of addressing social harms are too great for private entities. This serves to counter the caricature of Hayek as an uncompromising libertarian who categorically opposed any form of government intervention.

However, while Yadav appears to applaud this facet of Hayek’s thought, he stops short of a thorough examination of the implications and nuances of Hayek’s stance. The potential for governmental overreach, wherein interventions exceed their mandate, posing risks to market efficiency and innovation, represents a critical oversight.

This oversight introduces the possibility of the Nirvana Fallacy, where idealized solutions overshadow practical considerations, including the unintended consequences of government action (Cegledi 2022). Trusting the state to rectify market failures without acknowledging the potential for governmental inadequacies or the comparative costs of such failures versus market-driven solutions may not fully align with Hayek’s cautious endorsement of state action.

A more robust critique from Yadav would engage with historical examples of successful and unsuccessful state interventions, providing insights into the factors that contribute to their success or failure.


Yadav’s Liberalism’s Last Man challenges proponents of liberalism to re-engage with Hayek’s philosophy. Does his rearticulation fully capture the ideological battleground? Probably not; it indeed leaves us yearning for a deeper investigation of liberalism’s capacity to reimagine itself in opposition to contemporary foes. The book is an appeal to participate in, consider, and carry on the discussion about the future of liberalism. It forces us to look past our preconceived notions and take into account the future we’re creating. It does more than just offer commentary on Hayek; it also leads us through the difficulties of preserving liberalism in a time when political capitalism is the dominant force. Completing the book is only the beginning of a crucial conversation that is greatly needed in our day and age.


Samrudha Surana is an M.Sc. student at the Gokhale Institute of Politics and Economics. Dr. Prashant Narang is a Postdoctoral Researcher at the Knee Regulatory Research Center, West Virginia University.



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Godwin, M. (2021). “What would Hayek do about climate change?” The Breakthrough Institute, (13).

Hayek, F. (1944). The Road to Serfdom. Routledge.

Rayner, S. (2012). “Uncomfortable Knowledge: The Social Construction of Ignorance in Science and Environmental Policy Discourses”. Economy & Society, 41(1): 107-125.