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Source link: http://archive.mises.org/10353/how-to-use-methodological-individualism/

How to Use Methodological Individualism

July 27, 2009 by

Based on the Misesian distinction between theory and history, I will show that, while methodological individualism is properly applied in history, it is not a method that we use in theory. FULL ARTICLE

{ 8 comments }

Barry Loberfeld July 27, 2009 at 9:03 am

FROM HERE:

Hayek emphasized another conflict between the two conceptions of justice, one we can begin examining simply by asking who the subject of liberal justice is. The answer: a person — a flesh-and-blood person, who is held accountable for only those actions that constitute specifically defined crimes of violence (robbery, rape, murder) against other citizens. Conversely, who is the subject of “social justice” — society? Indeed yes, but is society really a “who”? When we speak of “social psychology” (the standard example), no one believes that there is a “social psyche” whose thoughts can be analyzed. And yet the very notion of “social justice” presupposes a volitional Society whose actions can (and must) be held accountable. This jarring bit of Platonism traces all the way back to Marx himself, who, “despite all his anti-Idealistic and anti-Hegelian rhetoric, is really an Idealist and Hegelian … asserting, at root, that [Society] precedes and determines the characteristics of those who are [its] members” (R.A. Childs, Jr.). Behold leftism’s alternative to liberalism’s “atomistic individualism”: reifying collectivism, what Hayek called “anthropomorphism or personification.”

Too obviously, it is not liberalism that atomizes an entity (a concrete), but “social justice” that reifies an aggregate (an abstraction). And exactly what injustice is Society responsible for? Of course: the economic inequality between Smith and Jones — and Johnson and Brown and all others. But there is no personified Society who planned and perpetrated this alleged inequity, only a society of persons acting upon the many choices made by their individual minds. Eventually, though, everyone recognizes that this Ideal of Society doesn’t exist in the real world — leaving two options. One is to cease holding society accountable as a legal entity, a moral agent. The other is to conclude that the only practicable way to hold society accountable for “its” actions is to police the every action of every individual.

Charles Hanes July 27, 2009 at 12:23 pm

The above comment seems to have nothing to do with this article.

Please suggest to this commenter that the purpose of the article comments is not to try to draw traffic to another website, and that is a misuse of this privilege.

Arend July 27, 2009 at 12:25 pm

Interesting article. It makes me wonder however how “Economics is not a branch of epistemology; and one cannot say anything meaningful about its epistemology before one is perfectly familiar with its contents.”, relates to seeing praxeology, of which catallactics (economics) is a branch, as being the foundation of epistemology itself (something that HHH claims in Economic Science and the Austrian method).

In the end I think theory is just some special kind of knowledge that needs an epistemological orientation to make sense of it. The epistemological orientation of methodological individualism is inherent in the theories of the science and method of praxeology. Of course MI is not the method of praxeology, but it is the epistemological orientation of praxeology. And it is replacable. Try to think of praxeology as the method for the historical sciences but then with a methodological collectivist epistemological orientation. It would still ‘work’ but one wouldn’t make much more sense than say, Marx or Hegel.

Barry Loberfeld July 27, 2009 at 12:49 pm

“The first comment seems to have nothing to do with this article.”

Indeed? Both deal with the concept of “individualism.”

“Please suggest to this commenter that the purpose of the article comments is not to try to draw traffic to another website, and that doing so is a misuse of this privilege.”

Linking is a “misuse”?

Janis July 28, 2009 at 7:57 am

Jörg Guido Hülsmann has written another wonderful article. I agree with the primary purpose of the article. But some statements are disputable. Although article is really good written, it is provocative because author might be somehow inclined to substitute Kantian and Misesian methodological apriorism with David Hume’s empiricism and Sent-Simonian deism. It could be succeeded by excluding from studies of methodological individualism a sphere of a priori synthetic judgments – Misesian methodological apriorism. Methodological individualism is not studied only by empirical observation, it is studied both by a posteriori and a priori judgment – whether it is analytic or synthetic.
Jörg Guido Hülsmann is right that sound economic theory (not simply economic explanation) does not deal with the contingent factors. But it is somehow unfounded to say that methodological individualism deals only with the contingent factors and therefore could be applied to historical science, not economics. Jörg Guido Hülsmann’s aim is to explain that anthropomorphism should be removed from economic theory before methodological individualism could be applied to economics. I might agree with some remarks. But I am saying that methodological individualism or praxeological studies comprise the historical science, economics and other social sciences, and therefore methodological individualism studies relations not only between man and contingent factors but also man’s actions under invariant conditions – how under certain given condition man substituted a more satisfactory state of affairs for a less satisfactory. Choice is also human action. In economics choice is observed as internal human action – valuation, in historical science choice is observed as external human action – usage of mean for the attainment of the end.
In the present article Jörg Guido Hülsmann becomes like a David Hume to exclude anthropomorphism from economic theory. A priori synthetic judgments are excluded form analysis of methodological individualism. Immanuel Kant explained that mistake in the beginning of the Prolegomena and to Any Future Metaphysics.

G8R HED July 28, 2009 at 1:20 pm

Mr. Hulsmann,
I have read and re-read what you have written here and am still not able to make the distinction you are presenting.

If economic activity is attributed to individual human action, how can individualism not be the (correct) method of economic theory?

The best this village idiot is capable of coming up with is that no economic activity could occur if only a single individual existed.

G8R HED July 28, 2009 at 1:42 pm

” no economic activity could occur if only a single individual existed.”

…what I mean to say is that I know that even an individual alone makes economic decisions but the above estimation is what I make of your comments.

JL July 29, 2009 at 7:32 am

Nice and interesting article, it was pleasure reading it, but I’m a bit perplexed about the Author’s understanding of Mises’ concept of methodological individualism. As I see it, Mises wanted to destroy utterly a false, but prolific notion of social wholes constituting beings in an onthological sense (e.g. society voting, working class having some form of class conciousness etc.), that is the error of hypostatization.
Thus, Mises writes (HA, p. 43):
‘A collective whole is a particular aspect of the actions of various individuals and as such a real thing determining the course of events.’
and
‘There is no substratum of society other than the actions of individuals.’
and
‘Not our senses, but understanding, a mental process, makes us recognize social entities.’
and
‘Those who want to start the study of human action from the collective units encounter an insurmountable obstacle in the fact that an individual at the same time can belong and—with the exception of the most primitive tribesmen—really belongs to various collective entities. The problems raised by the multiplicity of coexisting social units and their mutual antagonisms can be solved only by methodological individualism.’
I think that Mr. Huelsmann would very much agree with this line of reasoning. And I think that economic laws Huelsmann describes must be seen for what they are – laws binding numerous individuals, not some impossible holistic societes. So I think that throwing methodological individualism out the window misses Mises’ (sorry! ;) ) point:
The subject of economic theorizing, i.e. people, have a THEORETICAL CHARACTERISTIC of being individuals. No theorist should ever forget this point. And this point is perfectly consistent with really obvious Huelsmann’s position that economists shouldn’t bother to conceive some individual, concrete exemplum of a human being, e.g. John Doe, 34 years old and having a rash. Sorry for this little reductio ad absurdum.

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