“…It is not difficult to detect that both a priori axioms—of action and argumentation—are intimately related. On the one hand, actions are more fundamental than argumentations with whose existence the idea of validity emerges, as argumentation is only a subclass of action. On the other hand, to recognize what has just been recognized regarding action and argumentation and their relation to each other requires argumentation, and so, in this sense, argumentation must be considered more fundamental than action: without argumentation nothing could be said to be-known about action. But then, as it is in argumentation that the insight is revealed that—while it might not be known to be so prior to any argumentation—in fact the possibility of argumentation presupposes action in that validity claims can only be explicitly discussed in the course of an argumentation if the individuals doing so already know what it means to act and to have knowledge implied in action—both the meaning of action in general and argumentation in particular must be thought of as logically necessary interwoven strands of a priori knowledge.
What this insight into the interrelation between the a priori of action and the a priori of argumentation suggests is the following:
- Traditionally, the task of epistemology has been conceived of as that of formulating what can be known to be true a priori and also what can be known a priori not to be the subject of a priori knowledge. Recognizing, as we have just done, that knowledge claims are raised and decided upon in the course of argumentation and that this is undeniably so, one can now reconstruct the task of epistemology more precisely as that of formulating those propositions which are argumentatively indisputable in that their truth is already implied in the very fact of making one’s argument and so cannot be denied argumentatively; and to delineate the range of such a priori knowledge from the realm of propositions whose validity cannot be established in this way but require additional, contingent in formation for their validation, or that cannot be validated at all and so are mere metaphysical statements in the pejorative sense of the term metaphysical.
Yet what is implied in the very fact of arguing? It is to this question that our insight into the inextricable interconnection between the a priori of argumentation and that of action provides an answer:
- On a very general level, it cannot be denied argumentatively that argumentation presupposes action and that arguments, and the knowledge embodied in them, are those of actors. And more specifically it cannot then be denied that knowledge itself is a category of action; that the structure of knowledge must be constrained by the peculiar function which knowledge fulfills with in the framework of action categories; and that the existence of such structural constraints can never be disproved by any knowledge whatsoever.
It is in this sense that the insights contained in praxeology must be regarded as providing the foundations of epistemology. Knowledge is a category quite distinct from those that I have explained earlier—from ends and means. The ends which we strive to attain through our actions, and the means which we employ in order to do so, are both scarce values. The values attached to our goals are subject to consumption and are exterminated and destroyed in consumption and thus must forever be produced a new. And the means employed must be economized, too. Not so, however, with respect to knowledge—regardless of whether one considers it a means or an end in itself. Of course, the acquisition of knowledge requires scarce means—at least one’s body and time. Yet once knowledge is acquired, it is no longer scarce. It can neither be consumed, no rare the services that it can render as a means subject to depletion. Once there, it is an inexhaustible resource and incorporates an everlasting value provided that it is not simply forgotten. Yet knowledge is not a free good in the same sense that air, under normal circumstances, is a free good. Instead, it is a category of action.
It is not only a mental ingredient of each and every action, quite unlike air, but more importantly; knowledge, and not air, is subject to validation, which is to say that it must prove to fulfill a positive function for an actor within the invariant constraints of the categorical framework of actions. It is the task of epistemology to clarify what these constraints are and what one can thus know about the structure of knowledge as such.
While such recognition of the praxeological constraints on the structure of knowledge might not immediately strike one as in itself of great significance, it does have some highly important implications.”
“In fact, the reason why the social and economic future cannot be regarded as entirely and absolutely uncertain should not be too hard to understand: The impossibility of causal predictions in the field of action was proven by means of an a priori argument. And this argument incorporated a priori true knowledge about actions as such: that they cannot be conceived of as governed by time-invariantly operating causes.
Thus, while economic forecasting will indeed always be a systematically unteachable art, it is at the same time true that all economic forecasts must be thought of as being constrained by the existence of a priori knowledge about actions as such.  Take, for example, the quantity theory of money the praxeological proposition that if you in crease the quantity of money and the demand for money stays constant, then the purchasing power of money will fall.
Our a priori knowledge about actions as such informs us that it is impossible to predict scientifically whether or not the quantity of money will be increased, decreased or left unchanged. Nor is it possible to predict scientifically whether or not, regardless of what happens to the quantity of money, the demand for money to be held in cash balances will go up or down or stay the same. We cannot claim to be able to predict such things because we cannot predict future states of knowledge of people. And yet these states evidently influence what happens with respect to the quantity of money and the demand for money. Then, our theory, our praxeological knowledge incorporated in the quantity theory, has a rather limited usefulness for one’s business of predicting the economic future.”
-  The former Austrian and neo-historicist-hermeneutician-nihilist Ludwig Lachmann, who repeats ad nauseam the unpredictability of future states of knowledge (see his “From Mises to Shackle: An Essay on Austrian Economics and the Kaleidic Society,” Journal of Economic Literature 54 (1976); The Market as an Economic Process (New York: Basil Blackwell, 1986), entirely misses recognizing this latter point. In fact, his arguments are simply self-defeating. For evidently he claims to know for certain the unknowability of future knowledge and, by logical extension, of actions. Yet then he does know something about future knowledge and action. He must know something about knowledge and action as such. And this, precisely, is what praxeology claims to be: knowledge regarding actions as such, and (as I have explained in my “On Praxeology and the Praxeological Foundations of Epistemology and Ethics,” p.49 below) knowledge about the structure which any future knowledge must have by virtue of the fact that it invariably must be knowledge of actors.
not, as the mentioned critics seem to think, a proof that means to
show the impossibility of certain empirical events so that it could be refuted by empirical evidence. Instead, it is a proof that it is impossible to justify nonlibertarian property principles propositionally without falling into contradictions. Whatever such a thing is worth (and I’ll come to this shortly), it should be clear that empirical evidence has absolutely no bearing on it. So what if there is slavery, the gulag, taxation? The proof concerns the issue that claiming such institutions can be justified involves a performative contradiction. It is purely intellectual in nature, like logical, mathematical,or praxeological proofs. Its validity, like theirs, can be established independent of any contingent experiences. Nor is its validity in any way affected, as several critics—most notoriously Waters—seem to think, by whether or not people like, favor, understand, or come to a consensus regarding it, or whether or not they are actually engaged in argumentation.
“What if praxeology (deductive action theory in the tradition of Ludwig von Mises) is conceived as something much larger than merely the backstop for Austrian economics or a sort of pre-Austrian-economics warm-up act? In that case, economics ought to be better defined as one branch of praxeology among others. Since Mises kept mentioning economics as the “thus-far best-elaborated part” of praxeology, shouldn’t more thinkers be taking this up and working on advancing other such parts?
This is one of the questions addressed in my 2011 paper Action-Based Jurisprudence, which, among other things, sought to more explicitly define another branch that I am now calling the theory of legal concepts. I am now working on taking this approach further and in new directions, but meanwhile here is an update on the question of defining economic theory and other fields, as parts of praxeology. One element in what originally helped me get moving further in this direction of an enlarged vision for praxeology a couple years ago was Stephan Kinsella’s compilation of references, “Mises: Keep it interesting,” (Mises Economics Blog [RIP], October 16, 2010).
Since writing the original paper two years ago, I have taken note of the discussion in Guido Hülsmann’s 2003 introduction to the third edition of Epistemological Problems of Economics, entitled, “From Value Theory to Praxeology.” This describes Mises’s process of working backward from subjective value theory to arriving at his formal concept of action. It contains a descriptor at one point of economics as that part of praxeology that deals with action that uses economic calculation. On this basis, I might suggest for economics: the study of aspects of action as they arise uniquely only within the context of an exchange economy in that the latter enables economic calculation.
We can briefly test out this “exchange economy” proposal (or some other proposal) for the case of defining economics by playing a game of takeaway: “No exchange economy? No prices.” Check. “No exchange economy? No interest rates.” Check. And then on down the list of what we think ought to be considered part of “economics” proper. “No exchange economy? No time preference.” Well, no. Not so fast. There is time preference regardless of the presence/absence of an exchange economy, so this one doesn’t pass. It looks like it must belong more to a “core” area of praxeology rather than to any particular specialized branch of praxeological investigation.
We might also then see Mises’s classic statement on the impossibility of economic calculation under socialism, “Economic calculation in the socialist commonwealth,” (original German 1920) in a new light. It becomes a particular instance of playing the takeaway game: “No private factor-of-production ownership? No (real) factor prices and thus no profit/loss calculation.” Check.
My most recent thinking on the general issue is that praxeology is a tool that we can use as one element in the study of just about anything involving human action. The parts or branches should then simply be defined by the sets of subject matter that we are using praxeology to investigate. I was pleased to see some work in this direction in criminology as presented in Renaud Fillieule’s 2012 Mises Memorial Lecture, “Misesian praxeology: An illustration from the field of sociology of delinquency,” delivered at the Austrian Scholar’s Conference in Auburn, 10 March 2012, which I also recently mentioned here.
So we’re out here investigating what praxeology/thymology can show us if we apply it to issues x, y, and z, extending to all the things in the social sciences that we are interested in understanding better. This could become useful in the entirety of the social sciences—as opposed to the natural sciences—which I think is more what Mises had in mind with praxeology/thymology vis-à-vis natural science methods.
In other words, there ought to be plenty of work to do to carry forward the actual “program” that Mises launched, which was much larger than economics. It was a call for a revolution out of historicism (see especially Theory and History) and positivism (see especially The Ultimate Foundation of Economic Science) in the social sciences as such and was by no means limited to economics. Economics was Mises’s own primary specialization within praxeology; it doesn’t have to be everybody else’s.”
The Economization of Time
“Man is subject to the passing of time. He comes into existence, grows, becomes old, and passes away. His time is scarce. He must economize it as he economizes other scarce factors.
The economization of time has a peculiar character because of the uniqueness and irreversibility of the temporal order. The importance of these facts manifests itself in every part of the theory of action.
Only one fact must be stressed at this point. The economization of time is independent of the economization of economic goods and services. Even in the land of Cockaigne man would be forced to economize time, provided he were not immortal and not endowed with eternal youth and indestructible health and vigor. Although all his appetites could be satisfied immediately without any expenditure of labor, he would have to arrange his time schedule, as there are states of satisfaction which are incompatible and cannot be consummated at the same time. For this man, too, time would be scarce and subject to the aspect of sooner and later.”
“It is certainly not psychologically evident that with every action an actor pursues a goal; and that whatever the goal may be, the fact that it was pursued by an actor reveals that he must have placed a relatively higher value on it than on any other goal of action that he could think of at the start of his action.
It is not evident that in order to achieve his most highly valued goal an actor must interfere or decide not to interfere—which, of course, is also an intentional interference—at an earlier point in time in order to produce a later result; nor is it obvious that such interferences invariably imply the employment of some scarce means—at least those of the actor’s body, its standing room, and the time absorbed by the action.
It is not self-evident that these means, then, must also have value for an actor—a value derived from that of the goal—because the actor must regard their employment as necessary in order to effectively achieve the goal; and that actions can only be performed sequentially, always involving a choice, i.e., taking up that one course of action which at some given time promises the most highly valued results to the actor and excluding at the same time the pursual of other, less highly valued goals.
It is not automatically clear that as a consequence of having to choose and give preference to one goal over another—of not being able to realize all goals simultaneously—each and every action implies the incurrence of costs, i.e., forsaking the value attached to the most highly ranking alternative goal that cannot be realized or whose realization must be deferred, because the means necessary to attain it are bound up in the production of another, even more highly valued goal.
And lastly, it is not evident that at its starting point every goal of action must be considered worth more to the actor than its cost and capable of yielding a profit, i.e., a result whose value is ranked higher than that of the foregone opportunity, and yet that every action is also invariably threatened by the possibility of a loss if an actor finds, in retrospect, that contrary to his expectations the actually achieved result in fact has a lower value than the relinquished alternative would have had.”
“Great quote that suggests another psychological barrier that may go something like this: “If it is so ‘self-evident,’ why haven’t I seen it?” (!). Or “Why didn’t great philosopher X see it if it was self-evident?”. Or “Why not my mom and dad and Obama?” “If all these people also don’t see it, it must be wrong!”
This is harder to grasp even than that there was a time before there was an iPhone (that is, five and a half years ago). “Self-evident” only applies after you get it. Before the particular understanding has arisen in the particular mind, there is “nothing to see” in the space where a few of us have the action axiom installed.
Rand used to always say “knowledge is not automatic.” Well, here it is. The knowledge just isn’t there yet because the person doesn’t get it yet. Sort of like if you don’t know calculus. Well then…you don’t know calculus. The difference with praxeology and economics is that far fewer people go around denying the validity of calculus because THEY don’t happen to understand it. They understand that it is there for the learning, but to learn it, they would have to engage in a particular process: study, think.
Notice also that all of these learning injunctions are also themselves… actions, whether in sensory or mental realms:
- “In order to see the moons of Jupiter, you need a telescope. In order to understand Hamlet, you need to learn to read. In order to see the truth of the Pythagorean theorem, you must learn geometry. If you want to know if a cell has a nucleus, you must learn to take histological sections, learn to stain cells, learn to use a microscope, and then look. In other words, all of those forms of knowing have, as one of their significant components, an injunction: If you want to know this, you must do this.”
— Ken Wilber, The Marriage of Sense and Soul (1998, 156)
“In order to do so, Mises notices in accordance with the strictures traditionally formulated by rationalist philosophers, economic propositions must fulfill two requirements:
- First, it must be possible to demonstrate that they are not derived from observational evidence, for observational evidence can only reveal things as they happen to be; there is no thing in it that would indicate why things must be the way they are. Instead, economic propositions must be shown to be grounded in reflective cognition, in our understanding of ourselves as knowing subjects.
- And secondly, this reflective understanding must yield certain propositions as self-evident material axioms. Not in the sense that such axioms would have to be self-evident in a psychological sense, that is, that one would have to be immediately aware of them or that their truth depends on a psychological feeling of conviction.
On the contrary like Kant before him, Mises very much stresses the fact that it is usually much more pain staking to discover such axioms than it is to discover some observational truth such as that the leaves of trees are green or that I am 6 foot 2 inches.”
— Hans-Hermann Hoppe
“I think the importance of praxeology is far from recognized. Mises said that it was the only truly new science since ancient times. Everything else had some precedent even in the ancient world; this is a totally new field of knowledge and people don’t know what to make of it yet, or even how to mentally recognize what it is.
It cannot be overemphasized what a radical development it is to say that there is definite knowledge about humanity that is not part of ethical or “ought” sciences, and is not merely contingent or conventional in nature.
People just cannot wrap their heads around this easily because they intuitively assume that free choice automatically removes all structural constrictions, which it does not. Of the six modes, core praxeology, at least the fundamentals, gives rise to a type of knowledge that is under the mode of necessity (Notwendigkeit), of what cannot be otherwise (nicht anders sein können), whereas most people would place anything to do with knowledge pertaining to people and societies (or any empirical knowledge at all) in the modes of either actuality and possibility (is or isn’t, could be or could not be; but never MUST BE!).
Here is the section in Human Action, p.1 (!). What do you put on page one of a book like Human Action? This:
I. Economics and Praxeology
- “Economics is the youngest of all sciences. In the last two hundred years, it is true, many new sciences have emerged from the disciplines familiar to the ancient Greeks. However, what happened here was merely that parts of knowledge which had already found their place in the complex of the old system of learning now became autonomous. The field of study was more nicely subdivided and treated with new methods; hitherto unnoticed provinces were discovered in it, and people began to see things from aspects different from those of their precursors. The field itself was not expanded. But economics opened to human science a domain previously inaccessible and never thought of. The discovery of a regularity in the sequence and interdependence of market phenomena went beyond the limits of the traditional system of learning. It conveyed knowledge which could be regarded neither as logic, mathematics, psychology, physics, nor biology.”
And then this on p.4:
- “In the new science everything seemed to be problematic. It was a stranger in the traditional system of knowledge; people were perplexed and did not know how to classify it and to assign it its proper place. But on the other hand they were convinced that the inclusion of economics in the catalogue of knowledge did not require a rearrangement or expansion of the total scheme. They considered their catalogue system complete. If economics did not fit into it, the fault could only rest with the unsatisfactory treatment that the economists applied to their problems.”
 For the mode references, Nicolai Hartmann. Möglichkeit und Wirklichkeit, 1938, pp. 33; way overdue English translation of this book to come out in the next few months.
It’s a rare few who read, understand and fully appreciate ESAM. For those who already have a solid grasp of the literature I cannot recommend it enough. Those that do accept the challenge often cannot help but marvel at just how important and cutting edge this body of knowledge — praxeology — really is.
Essentially your comment touches upon what this blog is partially about — planting seeds. Further to this will follow several recent remarks and quotes that expand upon the above over the next few days.
Human Action Comics: Issue #1 - The Basics
A great graphical introduction to the science of human action, and its most developed part — economics proper — under the banner of the Austrian School. The above are some choice excerpts. The full slide show can be viewed here. Created by Danny Sanchez from the Mises Institute. The first in a series of many.
“How may praxeology be applied to forecasting, to the prediction of future historical events? The process is essentially that of a the historian, except that the difficulties are greater. Thus, using the above example the forecaster may see a considerable increase in the money supply take place. He asserts [(2)]; [(3)] he knows as a praxeological truth. In order to forecast the probable future course of purchasing power, he must make an estimate of the probable course of the demand for money in the period under consideration.
If, on the basis of his judgement, he decides that the relative change in demand will be negligible, he is in a position to predict that the purchasing power of the money unit will decline in that period. With the help of praxeology, his judgement is he best he can offer, but it is still inexact, dependent on the correctness of his estimate—in this case, of the movement in demand for money. If he wishes to make a quantitative estimate of the change in purchasing power, his estimate is still more inexact, for praxeology can be of no help in this attempt. If his prediction proves erroneous, it is not praxeology that has failed, but his judgment of the future behavior of the elements in the praxeological theorem.
Praxeology is indispensable, but it does not provide omniscience. It furnishes laws in the form of: If X, and if Y remains unchanged, then Z. It is up to the historian, and his counterpart, the forecaster, to determine the specific cases in which the law is applicable. It should now be clear that there are no praxeological laws of historical development, and that neither Mises nor myself need “reconcile” any “dilemmas” in setting forth such a law. If there were, then the task of the historian would be far easier than it is. Historical events are complex results of numerous causal factors, praxeological, psychologic, physical, chemical, biological, etc. The historian must determine which science and its laws apply, and, more difficult, the extent to which each causal factor operated in the events he is attempting to explain or predicts.”
— Murray N. Rothbard, Praxeology: Reply to Mr Schuller
Explanation of the roles of praxeological law and historical judgment or “understanding” may be provided by the following example: If the supply of a medium of exchange increases; and if the demand for that medium remains the same; then, the purchasing power of that medium will decline. This is a praxeological law.
How may an historian apply this law? He must first determine whether or not a decline in purchasing power (increase in prices) has taken place. This involves difficulties of an historical-statistical nature; it is not a problem for praxeology or that elaborated division of it known as “economic theory” or “catallatics.” Once he has determined that a fall in purchasing power of the medium has taken place, he searches for an explanation by applying the praxeological-catallatic law. He investigates the historical situation to discover whether there has been an increase in the supply of the medium. If he finds a considerable increase in the supply, he is then in a position to assert three truths:
- It is an historical fact that the purchasing power of medium X has declined to such and such an extent.
- It is an historical fact that the supply of the medium X has increased to such and such an extent.
- The praxeological law just mentioned. It is therefore concluded: that a significant cause of the decline, [(1)], was the increase in supply, [(2)].
If he finds no increase in supply, then he deduces that a fall in demand for the medium was the cause of the fall in purchasing power. Such is an example of what is involved in the work of historical explanation.
The work of the “economic theorist”, or praxeologist, is to elaborate the laws (such as ) from the various axioms and according to the rules of logic. Clearly neither Mises nor myself has ever cited “facts as if they provided support for his conclusions and for the axioms, postulates, and logical procedures.” I cited facts such as “dollar gaps” not as proof or test, but as illustrations of the working of praxeological laws in (modern) historical situations. It is a praxeological law that if the government (or any other agency exercising the power of violence) intervenes in the market to establish a valuation of any commodity below what would be the market valuation, a shortage of the commodity develops. Gresham’s Law is a subdivision of this law applied to media of exchange, which, in turn, leads to the explanation of the “dollar gap”. The historian sees a shortage of dollars in relation to pounds develop in England, and using praxeological laws, explains it as the consequence of governmental over-valuation of the pound in relation to the dollar. In no way does he test or “prove” the theory.
— Murray N. Rothbard, Praxeology: Reply to Mr Schuller