In the previous chapter, I described how different people have access to different knowledge, including the personal knowledge of their own perceptions, preferences, and opportunities, and various types of local knowledge. I also explained that this radical dispersion of knowledge--and unavoidable feature of human social life--leads to a knowledge problem when people seek to act on the basis of their differing knowledge in incompatible ways. While the fact of differing personal and local knowledge is a fact we must live with, we want to live with it as comfortable as possible. The pursuit of happiness requires that people be able to develop and to act on the basis of their own personal and local knowledge, but many actions are likely to affect others, sometimes adversely. What is needed than is some way for individuals and associations to develop and act on the basis of their own knowledge, while appropriately taking "into account" the knowledge of others. We seek, in a word, a way of ordering those human actions that are likely to affect others in such manner as to permit them to use their knowledge in pursuit of happiness.

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