… is from page xiii of Marjorie Grene’s Introduction to the 1969 collection of some of Michael Polanyi’s essays, Knowing and Being ; this passage of Grene’s Introduction refers to the thesis of Polanyi’s insightful 1962 essay “The Republic of Science “:
Fundamentally, what makes such a libertarian form of organization, operating indirectly through consensus rather than directly through planning, necessary to science is the unspecifiability inherent in the processes of discovery, of understanding and even of verification (or falsification). For what is essentially unspecifiable must either resist or be stifled by the specifiability of a master plan.
Indeed so. And what is true of the unspecifiablility of science – and the resulting reality that scientific progress requires that those who pursue knowledge be free of any master plan; the resulting reality that, to be successful, science must proceed by trial and error, consensus, and persuasion and not by coercion – is true for society at large.
The on-going processes of discovering new and better ways to enable ordinary men and women to improve their standards of living succeeds only if each of the many “searchers” (to steal Bill Easterly’s term ) – from the individual worker searching for a new job, to the lawyer working late at night in search of better contract terms for his client, to the visionary entrepreneur searching for the least-costly means of producing her new wiz-bang electronic device – have very wide space to explore, create, and experiment. And wide space also to succeed and to fail. (It’s no experiment if it cannot fail, or even if those who conduct it are under the plausible impression that some agency will mask any failure.)
Neither whole economies nor large sectors of economies (for example, the energy sector or health-care sector) can be successfully planned and centrally directed with force any more than formal science can be successfully planned and centrally directed with force.
(See also this earlier Quotation of the Day from M. Polanyi .)
An anecdote: In 1981, while chatting with several of us NYU graduate students, Fritz Machlup  remarked about Michael Polanyi and Michael’s older brother Karl : “Michael thought with his head; Karl thought with his heart.” (Machlup, to be clear, emphatically did not mean his comment to be a compliment to Karl.)