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Source link: http://archive.mises.org/16574/mises-on-mind-and-method/

Mises on Mind and Method

April 21, 2011 by

It has become a popular trick among people who are unprepared to grapple with the actual economic arguments of the Austrian School to try to short-circuit the debate. FULL ARTICLE by Daniel James Sanchez

{ 33 comments }

Jonathan M. F. Catalán April 21, 2011 at 11:55 am

This is a great article, I hope that praxeology skeptics take the time to read it and comment (even if they disagree). Unfortunately, praxeology is one of those topics where dissenters say it’s ‘absurd’ without really taking the time to explain why. Otherwise, people consider it ‘wrong’, but refuse to allot the time to familiarizing themselves with what they’re rejecting (a major reason people decide not to read Human Action, even though only around 100 pages are dedicated to epistemology and methodology).

I wanted to comment on the following sentence, though,

Everything that is valid in Gresham’s law, Hume’s price-specie flow mechanism, Ricardo’s law of comparative advantage, and Say’s law of markets is valid because it is based on the originator’s sound aprioristic understanding of human action and the assumptions introduced in formulating the theorem.

This seems slightly misleading. In the quote you provide just above this sentence, Mises isn’t arguing that Hume, Ricardo, and Say were familiar with the concept of ‘human action’, let alone had a “sound aprioristic understanding of human action.” Nothing could be further from the truth (see Israel Kirzner, The Economic Point of View). These economists did not see economics as science of human action, rather as a study of wealth (also, see John Maynard Keynes, The General Theory, p. 4 [first page of the first chapter] for a very brief discussion what Ricardo was studying).

Mises is implying that since what they were theorizing on were “problems raised by human action”, that their reasoning was aprioristic was inevitable (i.e. “Every attempt to reflect upon the problems raised by human action is necessarily bound to aprioristic reasoning”). In other words, that their reasoning was aprioristic does not require that they had a “sound aprioristic understanding of human action.”

Brian April 21, 2011 at 11:56 am

“For something like two decades, I have been pointing out that people cannot think, principally because philosophy has taught them that there is no such thing as reality.
They are hallucinating, now.” Beck, William(Billy). Two-Four.net. http://www.two–four.net/weblog.php. April 21, 2011That quote perfectly describes our political class now. We are in for a rough ride.

Gene Berman April 21, 2011 at 12:43 pm

Catalan:

An excellent observation,–one well worth making, especially in that it touches on that Mises emphasized the very human-ness of economic understanding.

Paul April 21, 2011 at 1:11 pm

Sanchez’ article is a great refresher. In addition though, Menger’s contribution to the subject must be appreciated.

When reading ‘Economic controversies,’ I got the feeling that Rothbard did not quite grasp the subtleties relating to free will and methodological dualism, as expounded quite well in this article. It seems Rothbard saw human action as literally separate from all other ‘natural’ phenomena, as opposed to involving far greater variables than that considered in the natural sciences. It’s fortunate that this lack of nuance in Rothbard’s epistemology didn’t get in the way of his being a great economist and historian.

fundamentalist April 21, 2011 at 1:30 pm

Great refresher! Thanks!

Although many Austrian economists are atheists, you might take a page from the creationist/evolutionist debates because the similarities are striking.

Evolutionists always attack creationists as being unscientific. Their definition of science is an appeal to authority: science is what the National Academy says it is. As a result, creation science always loses before courts and politicians because they accept that appeal to authority.

However, creation science has won the public debate and turned a majority of Americans against evolution by simply appealing to the public directly. We ask the public to listen to our evidence and make up decide for themselves whether or not it real science.

Austrians should consider a similar approach.

Austrian econ is the real empirical science. Hayek wrote the following in “Socialist Calculations”:

“In the social sciences it is the elements of the complex phenomena which are known beyond the possibility of dispute. In the natural sciences they can be at best only surmised. The existence of these elements is so much more certain than any regularities in the complex phenomena to which they give rise that it is they which constitute the truly empirical factor in the social sciences…The essential difference is that in the natural sciences the process of deduction has to start from some hypothesis which is the result of inductive generalizations, while in the social sciences it starts directly from known empirical elements and uses them to find the regularities in the complex phenomena which direct observations cannot establish. They are, Socialist Calculation so to speak, empirically deductive sciences, proceeding from the known elements to the regularities in the complex phenomena which cannot be directly established.”
Pages 126,127 of Individualism and Economic Order.

Seattle April 21, 2011 at 6:42 pm

However, creation science has won the public debate and turned a majority of Americans against evolution by simply appealing to the public directly. We ask the public to listen to our evidence and make up decide for themselves whether or not it real science.

The majority of americans also think social security and medicare are great ideas. The human brain has a defective design: You cannot trust public opinion.

fundamentalist April 22, 2011 at 3:05 pm

I’m not calling you a socialist, but you think like one: the people are too stupid and need a smart elite group to lead them.

Bala April 22, 2011 at 9:28 pm

Your judgement appears incorrect. He does imply that people are very stupid but does not imply that they need a small elite group to lead them.

fundamentalist April 23, 2011 at 11:43 pm

One implies the other. If people are stupid, then they need someone to lead them.

Bala April 24, 2011 at 12:00 am

No. It can also mean “People are stupid. Period.” It could also mean “People are stupid. Beware of what they say”.

You are therefore drawing false conclusions. In fact, if you read his next line, he talks of why you cannot ‘trust’ public opinion. ‘Trust’ for what? That should show you the error in your conclusion.

RS April 21, 2011 at 1:42 pm

And yet, in spite of all of this long winded nonsense, Annie Sullivan had to teach Helen Keller to conceptualize a world she had never seen and to understand speech that she never heard. Apparently such a monumental effort was unecessary since Helen Keller allegedly should have already known, apriori, everything already.

Paul April 21, 2011 at 5:47 pm

RS, actual experiences are separate phenomena from logical thinking. This does not mean that certain frameworks are not helpful for understanding phenomena that are otherwise too large in scope to be grasped by a single human being, e.g. the economy.

To take as an example the geometry parallel from Sanchez’ article (you did read Sanchez’ article, or Mises’ books, right?), sure one can think one’s way to figuring out the Pythagorean theorem, if one has a lot of time and imagination. But it is real world experience that helps us grasp the concept of angles and lines, by which our thinking on these matters is sharpened. Still essential is the particular framework by which all this data makes sense.

In the case of Helen Keller, how could she have even begun to have an understanding of the world, when she had yet to know of what it consisted? It’s like expecting someone to know the Pythagorean theorem without knowing what lines and angles are.

RS April 22, 2011 at 7:18 am

“In the case of Helen Keller, how could she have even begun to have an understanding of the world, when she had yet to know of what it consisted? It’s like expecting someone to know the Pythagorean theorem without knowing what lines and angles are.”

Yes, that was my point. Knowledge of reality can only come from reality, which one acquires via data gathered from the senses. There is no such thing as “apriori” knowledge if you mean that you can somehow gain knowledge prior to any sensory experience.

Paul April 22, 2011 at 9:29 am

I guess we can see here a misconception of ‘a priori,’ as though Mises was speaking of a separate universe from actual existence or experience. ‘Before experience’ as an English translation does not quite convey what Mises meant. It might be better to speak of thinking ‘apart from’ specific events or occurrences.

A priori does not mean one’s thinking is apart from reality; after all, even abstract thinking is an experience of its own, albeit an ‘experience’ that can be made to apply to a variety of different situations, e.g. business cycle theory applicability to the Great Depression and the 2000s housing bubble, among other historical events.

The point is that even empiricists require their logical frameworks by which to understand the world; facts must correspond to such logical frameworks for a theory to be considered sound. No matter what empirical basis you have, you will always have to argue your point on the basis of a certain interpretation, i.e. a framework apart from specific events.

Experience can only provide us with the variables that make up a problem, but it is only through logical deduction apart from specific examples that these variables are made sensible. Hence the a priori approach.

Are you serious about rejecting subjective valuation? How can you even get around the contradictions of other value theories without recognizing subjectivity? And the matter of anarchism and IP are not related to the issues at hand.

When it comes to epistemology and metaphysics, Rothbard and Rand were quite similar: they believed in a literal ‘free will,’ for one thing, as though human choices were isolated events from other phenomena in the universe. Both also had a more ‘objective’ view of the world, in comparison to Mises’ Kantian orientation, hence a significantly more shallow philosophy of Rand (e.g. incessant proclaiming of ‘A is A,’ as if non-contradiction was being disputed at all by Kant).

And in spite of Rothbard’s praise of ‘Theory and history,’ I doubt he grasped its philosophical premises, as seems to be the case in the ‘Economic controversies’ compilation.

Inquisitor April 22, 2011 at 12:40 pm

Why comment if you don’t even know what you’re talking about? Look up the definition of “a priori”. It pertains to the MODE of justification of knowledge, not the means of acquiring it. I mean you could learn this by just googling the term, nevermind doing a Philosophy course.

Bala April 21, 2011 at 10:57 pm

Good point. I have personally always been uncomfortable with the concept ‘a priori’. Your example (of Hellen Keller) is always the one that forces me to question the validity of the notion of ‘a priori’ as it has been explained in this article. Even non-contradiction is a concept grasped by the cognitive faculty by processing the perceptual material provided by the senses. I find Rand’s approach to these (epistemological) matters decidedly superior to the one that has been presented in this article. I suspect you do too (going by your past comments on various threads).

RS April 22, 2011 at 7:21 am

yes, I do. particuarly her views expressed in her Introduction to Objectivist Epistemology as well as David Harrimans new book The Logical Leap, Induction in Physics. I found that one to be very illuminating.

Bala April 22, 2011 at 10:30 am

ItOE was definitely extremely illuminating. I am yet to lay my hands on David Harriman’s book, though. I will take your cue and go for it. Whatever little I have read or heard from him makes a lot of sense :)

Thanks

Mr.huh? April 21, 2011 at 6:01 pm

Apriori reasoning is hardly something where everything is already known. The rules of logic are hardly inborn. Apriori reasoning is merely the formulation of a theory based upon observed data. In short, it is the first two steps of the scientific method.

I’ve also found it rather odd that many people despise the Austrian School of Economics as unscientific. To me, the whole concept of methodological individualism is science in its purest form, compared to the truly unscientific concept of aggregates and treating society as some kind of holistic concept.

GSL April 21, 2011 at 9:22 pm

Hence the Kantian concept of “synthetic a priori truths”. Geometric proofs are Kant’s common example: the properties of a point in space alone won’t enable you to prove any conjecture about, say, a cube. But that doesn’t mean the relationship between a point in space and a cube isn’t a priori; i.e., you don’t need to have the experience of seeing a physical cube to realize that.

Seattle April 22, 2011 at 1:33 am

But you do need to imagine a cube in order to realize that. Your imagination is perfectly valid as evidence. To the extent that it is accurate, that is.

Mr.huh? April 21, 2011 at 6:11 pm

Due also keep in mind that The Austrian School of Economics has the best track record of predicting many of the economic crashes of the past century, compared to the constant failures of the “scientific” Keynesians.

RS April 22, 2011 at 7:27 am

that may be true, but it is based on a corrupted epistemology so even though their predictions are accurate and apply very well practically their broader generalizations suffer because of it and dont actally reflect reality. subjective valueation theory is just one example and the rothbardian aversion to intellectual property and its penchant for anarchy is a direct consequence of that corruption.

Inquisitor April 22, 2011 at 12:44 pm

Except your own understanding of the very term “a priori” is incomplete, and you are criticising it by pointing to the consequences of its postulates without demonstrating why they are wrong.

GSL April 21, 2011 at 9:17 pm

It always bears repeating that you can’t actually argue that logic is insufficient to justify an idea, because you can’t argue without using logic. It’s depressing how resistant the modern brain is to grasping the concept of contradicton.

RS April 22, 2011 at 7:29 am

and you are of course, expressing this idea, as something that you arrived at logically!?!

Ron Finch April 21, 2011 at 10:12 pm

Your introduction is superlative and you may be correct in every word you write. Buuuuuuuuuut, I can not agree that “it makes no sense to try to test economic laws with experiments, observations, statistics, or any other kind of empirical data.” I know what you are saying about the inability to run controlled experiments. But you need to say it another way.
Economic laws are an explanation of how things are. Correct laws must agree with every observation. If the Austrian School is correct, then the others are wrong and plans founded on error will not achieve the desired goals. The others must fail empirical tests at some point.
For example, Einstein’s Relativity did not disprove Newton’s laws of motion. Albert added two more laws to the three described by Issac. Note that all five physical laws can be stated in language apart from Mathematics. Math is just quantitative logic. A limited subset of logic.
Mises is to Economics what Newton is to Physics.
People choose ideas like food and friends. They pick the ideas they like. Then they look for facts and arguments to support them. The scientists who make the effort to understand how things actually work are a small minority.

Jonathan M. F. Catalán April 22, 2011 at 11:57 am

Ron,

Once we’re talking about explaining empirical events we are talking about history. Whether a particular theory agrees with the empirical evidence can’t tell you whether or not the theory is valid; it just isn’t applicable. It’s not just about controlled experiments, but also of being able to dissect every individual piece of datum that makes up the evidence, given that historical events tend to be very complex.

Gene Berman April 22, 2011 at 8:07 am

RS:

You’re a commenter of a rare sort here–just plain full of shit.

Michael Labeit April 23, 2011 at 7:23 am

I wonder to what extent mathematical economics is invalid. Can’t for instance the laws of supply and demand be expressed as functions with or without the aid of calculus?

Bala April 23, 2011 at 8:56 am

Answering both your questions, completely and not at all.

Steven April 26, 2011 at 12:07 pm

I believe that for the Congressman William Lacy Clay to acknowledge the argument put forth by Mr. Thomas DiLorenzo, would be a contradiction in his understanding as to where he actually receives his own income.
If the Government were to admit that Austrian economics be adopted would put and end to their own looting of the system. The populace needs to get informed.

The Best of Times

Barry Linetsky May 4, 2011 at 1:48 pm

Daniel:

Thanks for taking the time to write this outstanding and scholarly essay. I found it highly readable and very illuminating as a summary of issues spread across three Mises books. I’m sure it will be a valuable reference article for students of Mises’ thought for a long, long, time.

Barry Linetsky
Toronto

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