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July 22, 2014 / Adam Knott

Introduction to the Theory of Interpersonal Action

Part 1 – Praxeology and Categories of Consciousness

 

A.

Exact Laws of Human Action

The goal of praxeology is to discover and to make explicit “exact laws” of human action of the general form “if you do X, then Y must necessarily happen or result.”

The reason economics has had some success in this is because economics deals largely with what one may call “calculative action” or what Mises referred to as “catallactic action.”   Because economics treats the money economy, it deals with countable units that can be mathematically manipulated.   And thus when we read Mises’s description of two laws of economics, the law of returns and the law of marginal utility, we will see that he introduces simple mathematical symbols such as n-1 or p/q.

The laws of economics, or the law-like propositions of economics, seem to be formulable due to the fact that economics deals with the money economy and the assumption of identical money units subject to simple or complex mathematical operations.  For example, one of the fundamental notions of Austrian economics is the notion that when the government prints more money, this money printing does not increase the amount of goods and services offered in the economy, and thus the ratio between the monetary unit and the available goods and services
necessarily changes.  This reduces to a simple mathematical comparison of n+1/1 to n/1.

We conclude that economics is able to formulate law-like propositions of exactness primarily due to the fact that economics assumes identical money units (or identical commodity units) to which mathematical operations may be applied.

B.

Must exact laws of human action be strictly mathematical in nature, or are there other kinds of exact laws of human action? Due to mathematics we may say “if I have 4, and I take away 2, then I will have 2.”    This is an “exact” law-like proposition concerning the action of taking away 2 units, and the exactness seems to derive from our ability to apply mathematics to the action in question. But are there non-mathematical exact-law propositions that may be formulated about human actions?

Two examples cited in the past are:

1.  In walking toward a location (action X), one must necessarily walk away from a different location (necessary result Y).

2.  If one makes an automobile more fuel efficient by making the automobile more aerodynamic, one necessarily makes the automobile harder to bring to a stop (i.e., the braking power needed to bring the car to a stop in the same distance must increase).

Thus, it is possible, in principle, to formulate exact laws of human action that are non-mathematical in the sense that they do not require or assume a number of identical units to which mathematical operations are applied.   The actor performs an intentional action:  he walks toward a location, or he makes a car more fuel efficient by improving its aerodynamics.  To these intentional actions necessary consequences or results are attached—results or consequences that were not the conscious intention of the actor.   The result or consequence Y is a necessary “accompaniment” to the action X that the actor performs.

This indicates that the essence of necessity in human action is not mathematical in nature (in the sense of numbers or mathematical operations or ratios).   The essence of necessity in human action is an identity relationship.  By “identity relationship” we do not mean A = A.  By “identity relationship” we mean a demonstration of an identity between A and B, such as:

12 x 2 = 3 x 8

12 x 2 and 3 x 8, are not identical in every respect.  They are only identical in a circumscribed and specific respect, and we conceive mathematics as an exact science that demonstrates the specific sense in which the action of multiplying 2 by 12 is identical to the action of multiplying 3 by 8.

Similarly, walking toward a location and walking away from a different location are not identical in every respect.  But we can see that walking toward a location is the same thing as walking away from a different location in some respect.   The respect in which walking toward a location (phenomenon A) is the same as walking away from a different location (phenomenon B) we call the identity relationship.

In his essay “Economics and Knowledge,” Hayek referred to these identity relationships as “tautological transformations,” and he referred to praxeology (which he called the Pure Logic of Choice) as “the system of tautologies—those series of propositions which are necessarily true because they are merely transformations of the assumptions from which we start.”

In this kind of procedure, we begin with an assumption (in our case, action X), and we show how action X must necessarily entail Y, a necessary accompaniment which may not be fully recognized by the actor who performs action X. Result Y is the so-called “unintended consequence.”  As Lionel Robbins explains in An Essay on The Nature & Significance of Economic Science:

The analytic method is simply a way of discovering the necessary consequences of complex collocations of facts—consequences whose counterpart in reality is not so immediately discernible as the counterpart of the original postulates.

We conclude that it is possible to formulate non-mathematical exact laws of human action. The essence of these exact laws is an identity relationship—a demonstration of the sense in which A and B are identical.

C.

Interpersonal Action

So far we have dealt with “calculative” or “catallactic” actions (the subject matter of economics), and we have dealt with “physical” or “spatial” actions such as walking toward a location or changing the shape of a car.

The most important realm of human action for libertarian social thought is the interpersonal realm of human action.  Interpersonal actions are actions in which one actor acts toward another actor.  This is the area of human action that has up until now been the province of traditional ethics, objective ethics, natural law ethics, and recently, the argumentation ethics.  The goal is now to treat this realm of action as a branch of praxeology, and this means the attempt to demonstrate exact laws (similar to what was discussed above) in the interpersonal realm of human action.

We define an interpersonal action as an action in which the mind (consciousness) of another actor is the object of one’s action. An interpersonal action occurs when actor A “locates,” in the field of his own mind or consciousness, the mind or consciousness of another actor B.  In other words, for me, an actor, an interpersonal action happens when another person’s mind or consciousness “appears” (in a sense yet to be described) in my consciousness field.  When another mind or consciousness is the object of my action (is the object of my intentional consciousness), this “is” (this constitutes) an interpersonal action.

(If I merely interact with a warm body, this is not necessarily an interpersonal action.  Interacting with another object may simply be a physical action.  An interpersonal action is the specific case when the object with which I interact is a mind or consciousness similar to my own.)

If interpersonal action occurs when another mind or consciousness appears as the object of my mind or consciousness, then the question becomes: what is the identity relationship or tautological transformation concerning this assumed situation, analogous to the identity relationships discussed above?  The identity relationship or tautological transformation that we may demonstrate, applied to the case when another mind or consciousness is the object of my mind or consciousness, will be an exact law of interpersonal action, given the definition of interpersonal action above.

D.

The Structure of Interpersonal Action

When we speak to another person face-to-face, or speak to another person on the telephone, we act under the assumption that we are in the presence of another mind or consciousness similar to our own.   When we interact socially, we isolate or locate within the field of our consciousness another mind toward which we direct our communications or actions.   For example, when we lie, we lie toward another mind.  This implies that we have located another mind in some specific realm or region of our overall field of consciousness.  (I don’t direct my lie to the empty sky or toward a rock; I direct it to another mind in order to deceive that other mind)

When we examine the nature of the other mind that we locate (in order to direct our actions or communications toward it) we will find that the other mind never belongs to the category of things we may observe sensually or perceptually. The other mind is always and at all times something that “presents” to us as an “unobservable.”   When I am in the presence of another mind, the other mind is not present to me in the same sense as the front half of the basketball I see; rather, when I am in the presence of another mind, the other mind is always present to me in the same sense that the back half of the basketball is present to me. I.e., another mind, when present, is always present to me as a non-perceptible or non-observable “presence”—something that is “there now” but not now observable. Just as the back half of a basketball is “present” now, but not now observable, when I interact with another person, the mind I interact with is “present” now, but not now observable.

Thus, for our consciousness, there is a class or category of things that “appear” for us, not as observable things, but as non-observable things.  This category includes things such as other minds, the other side of objects, the inside of objects, concepts, and other entities of similar nature.  These are “things” that are “present” to us in the sense that we locate them within the field of our consciousness though we never observe them. We may refer to this category of “things” as the category of non-perceptible (or non-perceptual) presence.

Thus, there are at least two categories of consciousness (and in the present theory, only two categories of consciousness):

1.  A category of perceptual presences (visual sensations, audible sensations, tactile sensations, olfactory sensations, imagined or mental images or sounds, etc.).   This is the class of things that “present” to my consciousness perceptually.

2.  A category of non-perceptual presences (as just described and defined).

E.

Two Categories of Consciousness

These two categories of consciousness ultimately derive from the same source as the social-scientific category pairs supply/demand and supply/value. (supply/value is the category pair on which the law of marginal utility is based)

Each of these pairs consists of a category of an object of action (the supply) and a category of an intangible/immaterial “attitude” of the actor in relation to that object (demand or value).

Demand and value as we conceive them are of the same nature as the concept of utility: they are conceived as an actor’s immaterial and intangible “attitude” toward the object of his action.  These things (demand, value, utility, etc.,) are not considered “extended” entities having spatial dimensions or observable characteristics.

The category pair means/ends is, we will argue, of this same essential structure.  The “end” of the actor is identical to his purpose or intention.  These all refer to the same thing: the immaterial “attitude” of the actor in relation to the object of his action (the means).

Thus, we have several examples of fundamental category pairs of social science:  supply and value, supply and demand, means and ends.   The recurring pattern is: the object of the actor’s action in relation to the actor’s immaterial/intangible attitude toward the object of his action.

We view these category pairs as historical social concepts reflecting an underlying structure of consciousness. In other words, the category pairs of social science and social thought have been conceived in different ways throughout history, but all have derived from the fundamental binary structure of consciousness. There is a category of things that appear to a consciousness perceptually; things that may be sensed, imagined, or observed.  This is the aspect of consciousness from which the historical social-scientific categories supply and means have been derived. There is a category of things that appear non-perceptually or that are “non-perceptually present.”  This is the aspect of consciousness from which the historical social-scientific categories demand, value, ends, purposes, intentionsutility, etc. have been derived.

F.

Category Pairs: History

The category pairs supply/demand and supply/value were developed within the science of economics, which as mentioned, treated the money economy and included the assumption of identical monetary or commodity units.  The assumption of identical monetary or commodity units made possible the introduction of mathematical operations (n-1, p/q, etc.) which in turn made possible the formulation of law-like propositions in regard to the economic (catallactic) aspect of human action.   This bestowed the social science of economics, to some extent, with an aura of scientific legitimacy.

By contrast, category pairs such as happiness/unhappiness, satisfaction/dissatisfaction, pleasure/pain, ease/unease, means/ends, etc., though ultimately derived from the same binary structure of consciousness as supply/demand and supply/value, were generally developed within branches of social study that could not make the assumption of identical units subject to mathematical operations (e.g., the disciplines of ethics, morals, and political science).  For this reason, these branches of social study were prevented from formulating law-like propositions of exactness that applied in their field, or were prevented from formulating law-like propositions of equal stature to those put forth by economics. These disciplines were generally denied the aura of scientific legitimacy.

The most significant difference between the former and the latter group of category pairs however, is that economic theory evolved in such a way that the concept “supply” on the one hand, and the concepts “demand” and “value” on the other, came to denote entities of a fundamentally different nature. Broadly speaking, by “supply,” one means the objective quantity or amount of a thing available for utilization by a person or group. By “demand” or “value,” one means a kind of assessment of the supply on the part of a person or group (the aforementioned “attitude” of the person toward the supply). “Demand” means the person wants more of a thing, implying an assessment of an insufficient supply. “Value” is an assessment of the importance of the thing to the person and implies an attempt to gain or keep the thing in question. One concept (supply) refers to the object; one concept (demand or value) refers to the actor’s “attitude” toward the object.

If we look at the second group of category pairs—those that were developed outside of economic science—we will notice that the intra-pair relationship is not the same as the intra-pair relationship of the economic category pairs. In the second group of category pairs, the entities referred to in each pair are generally considered entities of the same nature. For example, “pleasure” is a kind of feeling experienced by a person, and “pain” is a kind of feeling experienced by a person. The same holds for the category pairs happiness/unhappiness, satisfaction/dissatisfaction, ease/unease, etc. One may have the experience of happiness, or one may have the experience of unhappiness. The two conceptions are fundamentally alike in the sense that both refer to a kind of experience that an individual may have.

The situation surrounding means and ends is slightly more complex. We can say at a minimum that means and ends are generally considered similar with respect to the way an individual would verify their presence or attainment. An individual verifies the presence of a particular means he is utilizing by perceiving or observing those means. I see the shovel I intend to use to dig a hole. Similarly, an individual verifies that the end he sought has been attained by perceiving or observing that the end has been attained. I see the hole which it was my intention to dig. Means and ends are generally considered entities of a similar nature in the sense that both are considered to be, at least in principle, perceptible or observable entities.

The essential point is that the conception of the category pairs of theoretical economics has evolved further than the conception of the category pairs of the normative disciplines. In economics, the development of the category pairs has been toward a conception in which each category denotes an entity of an altogether different nature. In the normative disciplines, each category of the category pair tends to denote an entity of an essentially similar nature.

G.

Category Pairs: Reconception

The foregoing considerations imply that theoretical advancement in the fields subsumed by the normative disciplines is dependent on the evolution of the conception of the category pairs employed by these disciplines. Specifically, these category pairs must be reconceived such that each category denotes an entity of a fundamentally different nature. In the present theory for example, we conceive means as those things in action (in consciousness) that are perceptible, sensible, observable, etc. (this includes all “mental” perceptions, sensations, imaginings, etc.). By contrast, we conceive ends, or the end, as fundamentally nonperceptible and nonobservable. An end, qua end, can never be perceived, sensed, or observed; only means can be perceived, sensed, or observed. In the present theory, ends belong to the category of nonperceptible presences; the category of things that—from the actor’s point of view—are the nonobservable aspect of what the actor is now doing.

Mises is working with a similar conception of the means/ends relationship. In his conception ends are considered beyond rational or scientific treatment, and only means can be assessed rationally or scientifically.

As soon as people venture to question and to examine an end, they no longer look upon it as an end but deal with it as a means to attain a still higher end. The ultimate end is beyond any rational examination. All other ends are but provisional. They turn into means as soon as they are weighed against other ends or means.(TH-14)

As soon as we start to refute by arguments an ultimate judgment of value, we look upon it as a means to attain definite ends. But then we merely shift the discussion to another plane. We no longer view the principle concerned as an ultimate value but as a means to attain an ultimate value, and we are again faced with the same problem.(TH-23)

In fact, he who passes judgment of an alleged end, reduces it from the rank of an end to that of a means. He values it from the viewpoint of an (higher) end and asks whether it is a suitable means to attain this (higher) end.(MM, 22-23)

As these passages demonstrate, Mises was aware that to examine a thing (X) with regard to its suitability, is to examine it with regard to its suitability for purpose Y, and therefore X is examined as a means to attain Y. We cannot examine “ends” with respect to their suitability or fitness. When an entity is in my conscious view such that I can “examine” it in some regard, it thereby occupies a definable categorial “location” in my consciousness. Every object or entity brought into my conscious view occupies this same categorial “location.” This particular category Mises refers to as means.

The present theory explains the nonrationality of ends to which Mises refers in terms of a category of nonperceptual or nonobservable “presence.” This category is comprised of things that from the actor’s point of view are “present” but not presently observable (e.g., the mind of another person the actor is addressing, the back side of a wall, the inside of a box, etc.). The category of ends and the category of nonperceptual presence are identical. By contrast, the category means refers to those things that are perceptually present to the actor; those things that the actor presently perceives, observes, or senses. The two categories thus refer to “objects” of a fundamentally different kind.

The foregoing considerations imply that the category pair happiness/unhappiness (satisfaction/dissatisfaction, pleasure/pain, ease/unease, etc.) should be reconceived so that each category refers to an object of a fundamentally different nature. Following what has been discussed regarding the category pairs supply/demand, supply/value, and means/ends, this means we will conceive one of the categories (e.g., happiness) as referring to that which is perceptible, sensible, or observable to a consciousness, and we will conceive the other category (unhappiness) as referring to those things in consciousness that are “present” but not presently perceptible.

Let us make a brief sketch of our proposed reconception in relation to the historical conceptions of the binary category pairs.

H.

Category Pairs: Reconception

In economics, the category pairs supply/demand and supply/value were conceived such that each category refers to an object of a fundamentally different nature: 1) and object, and 2) an “attitude” toward that object on the part of an actor. In this conception, the object is (generally) conceived as belonging to objective, extended nature, while the “attitude” is generally conceived as belonging to the actor or “subject.” The object (the supply) is considered an “objective” entity while the actor’s “attitude” is considered a “subjective” entity.

By contrast, in our proposed reconception, the object is considered a subjective entity. In this conception, the term “object” refers to the perceptual or sensual or observational content of a consciousness (“object” here does not refer to an entity assumed to exist independent of conscious awareness). We are conceiving the entire field of one’s conscious awareness in terms of two categories: 1) a category of the perceptions, sensations, or observations, that appear to this consciousness (or that constitute it), and 2) a category of “things” that are present to this consciousness, but not presently observed, perceived, or sensed by it (the aforementioned nonperceptible presences). In this conception, the notion “object” refers exclusively to the perceptual content of a consciousness.

Thus, in our conception, it is this subjective object that stands in relation to the actor’s immaterial “attitude.” In this conception, the object, and the attitude related to this object, are both aspects of the actor’s consciousness; they are both subjective phenomena.

Turning back to the economic category pairs supply/demand and supply/value, when the actor possesses an attitude of “demand” or of “value” toward a given supply, in our conception “supply” refers to the perceptual/observational/sensible content of his consciousness, and only to this content. The “object” is that which is currently present to a consciousness as a perception, sensation, or observation. This object (or perceptual content), in combination with the nonperceptual presence (the actor’s immaterial “attitude”), constitutes the totality of the actor’s conscious field (the totality of the actor’s conscious awareness). This conception, entirely subjective, wherein the various phenomena are conceived as aspects of a single consciousness, implies a corresponding subjective conception of economic science. It was this entirely subjective conception of economics that Mises practiced and advocated, and that Hayek was referring to in his fateful essay “Economics and Knowledge.”

It is important to remember that the so-called “data,” from which we set out in this sort of analysis, are…all facts given to the person in question, the things as they are known to (or believed by) him to exist, and not, strictly speaking, objective facts. It is only because of this that the propositions we deduce are necessarily a priori valid and that we preserve the consistency of the argument.

[In this sort of analysis] “data” meant those facts, and only those facts, which were present in the mind of the acting person, and only this subjective interpretation of the term “datum” made those propositions necessary truths. “Datum” meant given, known, to the person under consideration.

It was this entirely subjective conception of economics that Hayek argued against in “Economics and Knowledge,” and it was partially due to Hayek’s arguments that this subjective approach to social phenomena was abandoned within the economics profession. Since that time, the underlying epistemological structure of economics has consisted of both objective and subjective elements, and economists have implicitly assumed these elements are theoretically commensurate, as one would in assuming that a carved wooden “X” is interchangeable with the mathematical symbol “X.”

I.

Category Pairs: Reconception

We now turn to the non-economic category pairs such as happiness/unhappiness, satisfaction/dissatisfaction, pleasure/pain, and means/ends. In the traditional or standard conception of the non-economic category pairs, both categories refer to a subjective phenomenon, and to a phenomenon considered—at least in principle—observable or perceptible to the person in question. Generally speaking, both categories refer to subjective entities that the actor may see, feel, experience, or observe. The actor can experience happiness and the actor can experience unhappiness. The actor can see his means, and the actor can see his end, etc.

By contrast, our reconception of the non-economic category pairs consists of reconceiving one of the categories (for example, unhappiness, dissatisfaction, pain, and ends) as a category of nonperceptual presence. In our conception, one category consists of entities that are perceivable or sensible or observable by the actor, while the second category consists of entities that are present but not presently perceivable, sensible, or observable by the actor.

It is important to note that in this conception there is no conceived temporal separation between the two categorial phenomena that constitute the actor’s conscious awareness. The nonperceptual presence is “copresent” with the object that is perceptually present to the actor. The backside of the wall is copresent with the wall; the inside of a box is copresent with the box; the mind of another person is copresent with that person, etc.

Below we list the different historical conceptions and the proposed reconception:

Supply/Demand

Supply: objective
Demand: subjective
Supply: observable/perceivable by actor himself
Demand: observable/perceivable by actor himself

Supply/Value

Supply: objective
Value: subjective
Supply: observable/perceivable by actor himself
Value: observable/perceivable by actor himself

Means/Ends

Means: subjective
Ends: subjective
Means: observable/perceivable by actor himself
Ends: observable/perceivable by actor himself

Happiness/Unhappiness

Happiness: subjective
Unhappiness: subjective
Happiness: observable/perceivable by actor himself
Unhappiness: observable/perceivable by actor himself

Proposed Reconception

Perceptual Presence: subjective
Nonperceptual Presence: subjective
Perceptual Presence: observable/perceivable by actor himself
Nonperceptual Presence: NOT observable/perceivable by actor himself

 

Notes: 1. Here we assume that the actor’s “demand” or “value” in regard to the supply has traditionally been conceived as perceivable or sensible to the actor himself. 2. The categories happiness/unhappiness are here considered identical to those of satisfaction/dissatisfaction, pleasure/pain, ease/unease, etc.

 

Part 2 – Theory and Structure

A.

Our goal is a praxeological theory of interpersonal action. This means the attempt to conceive exact laws of human action in the interpersonal realm of human action. A theory of necessity linking two nonidentical entities requires an atemporal identity relationship between the two entities.

In the present theory, we conceive consciousness in terms of two categories: a category of perceptual presences, and a category of presences not perceived. This conception of consciousness is a rendering from the point of view of the individual, unitary, conscious subject. There are fundamentally two categories of “things” that constitute my conscious field: those things that appear to me perceptually (perceptions, sensations, imaginings, mental images, etc.), and those “things” that are present, but which I do not presently perceive, sense, or have a mental image of.

A simple theory of interpersonal action is implicit in this general theory of consciousness structure. The mind or consciousness of the person with whom I interact belongs to the category of things that are present to me, but which I do not presently observe. The perceptual or sensual aspects of this person (the body I see, the voice I hear, etc.) belong to the category of things perceptually present to me. The person with whom I interact is thus entirely constituted of these two fundamental consciousness categories. In other words, the person with whom I interact is constituted of two distinct parts (categories) of me, the unitary consciousness. This is a subjective as opposed to an objective conception of social interaction.

This theory of the structure of consciousness solves the problem that Alfred Schutz referred to in The Phenomenology of the Social World:

We must, then, leave unsolved the notoriously difficult problems which surround the constitution of the Thou within the subjectivity of private experience. We are not going to be asking, therefore, how the Thou is constituted in an Ego…As important as these questions may be for epistemology and, therefore, for social science, we may safely leave them aside in the present work. (1972, p. 98)

The “Thou” (the person with whom I interact presently) is constituted within the subjectivity of my private experience of two classes of things. On the one hand, the Thou is constituted of perceptual presences (visual sensations, audio sensations, tactile sensations, olfactory sensations, etc.). On the other hand, the Thou is constituted of “presences” that are not perceived (the back side of the person, the inside of the person, the mind of the person, etc.). The mind of the person with whom I interact belongs to the category of things that are present to me (I believe this person’s mind is “here now,” with this person) but not presently observable or perceivable by me.

B.

The present theory is essentially a theory about the structure of consciousness. We conceive consciousness as a binary structure. We interpret the various historical concept pairs of social science and social thought (e.g., supply/demand, supply/value, means/ends, happiness/unhappiness, pleasure/pain, satisfaction/dissatisfaction, good/bad, moral/immoral, just/unjust, etc.) as having derived from the two fundamental consciousness categories.
The binary nature of our consciousness renders our conscious experience in binary form, and we in turn express this experienced binary form in various ways in our social science and social thought. The different concept pairs signify the different ways we have interpreted the binary structure of our consciousness throughout history.

I, actor A, am constituted, as it were, of two categories: a category of perceptual presences, and a category of presences not perceived. We define interpersonal action as occurring for actor A when the mind or consciousness of another actor (B) is “present” for A. As previously argued, from the point of view of A, the mind or consciousness of B belongs to the category of those things present to A, but not presently observed by A. B‘s mind is “present” to A as a nonperceptual presence. We define interpersonal action as the situation in which the particular nonperceptual presence present for A is the mind or consciousness of another actor B.

It is important to note that in our conception of interpersonal action, the presence of the mind of actor B (as a nonperceptual presence) is consistent with any set of perceptual contents present for actor A. For example, let us assume that A is on the telephone with B. We assume B‘s mind is present for A as a nonperceptual presence. This constitutes interpersonal action for actor A. Also present for A are perceptual presences (e.g., B‘s voice, the sight of the telephone, the touch of the telephone, etc.).

Let us now assume that during the telephone conversation person B stops speaking. We assume further that B‘s mind is nonetheless present for A as a nonperceptual presence (A believes he is still in the “presence” of B even though B is not currently speaking). In this case, the voice of B is not one of the perceptual presences present for A, though A is still engaged in interpersonal action. This is because the defining characteristic of interpersonal action is the presence of the mind of another actor B, and the presence of the mind of another actor B,
as something that does not appear perceptually, is consistent with any set of perceptual contents appearing for actor A. In our conception, the phenomenon of interpersonal action is entirely independent of the perceptions, observations, or sensations present to A during interpersonal action.

C.

An Exact Law of Interpersonal Action

Above, we have defined interpersonal action in terms of the fundamental category pair “perceptual presence/nonperceptual presence.” If we now substitute for the fundamental category pair some of the historical category pairs we obtain some interesting results. Recall that we had discussed category pairs such as supply/demand and supply/value, and we had conceived that the term “supply” referred to the object of the actor’s action while the terms “demand” and “value” referred to the actor’s immaterial “attitude” toward the object of his action. What we had in mind was a conception, analogous to the fundamental category pair (perceptual presence/nonperceptual presence) in which “supply” refers to those things in action (in consciousness) that are perceptible, observable, and sensible, while “demand” and “value” refer to that in action which is nonperceptible, nonobservable, and nonsensible. Here, we are reconceiving the category pairs supply/demand and supply/value to conform to the conception of the fundamental category pair, so that “supply” is identical to the category of perceptual presence, and “demand” and “value” are identical to the category of nonperceptual presence.

Returning to the notion of interpersonal action then, if we use the older terminology (use the older terms that express the binary nature of consciousness) we would conceive that when actor A is engaged in interpersonal action, those things that are perceptible or sensible or observable to A would constitute his “supply,” while those things present to him, but not presently perceptible, would constitute his “demand” or his “value.” We are simply giving the older names to the newly conceived categories.

If we make this same substitution using the older category names happiness/unhappiness, satisfaction/dissatisfaction, pleasure/pain, then we obtain the result that those things perceptible to A during interpersonal action constitute his “happiness” (or satisfaction, or pleasure) while those things nonperceptually present to A during interpersonal action constitute his “unhappiness” (or dissatisfaction, or pain).

Thus, we have an identity relationship or “tautological transformation.” Interpersonal action occurs when the mind of actor B appears in the conscious field of actor A. The mind of actor B appearing in the conscious field of actor A is a nonperceptual presence appearing in the conscious field of actor A. A nonperceptual presence appearing in the conscious field of actor A constitutes unhappiness (or dissatisfaction, or pain) for A. Interpersonal action thus constitutes unhappiness (or dissatisfaction, or pain) for actor A.

This insight was the basis for an earlier version of the present theory presented in Striving and Attainment (2008, pp. 98-107). When we conceive consciousness and human action in terms of the two categories happiness/unhappiness (satisfaction/dissatisfaction, ease/unease, pleasure/pain, etc.), there is a sense in which we can conceive a necessary relationship between interpersonal action and human happiness.

D.

Original Insight

The theory of interpersonal action is based on a prior theory of social interaction conceived in terms of “striving” and “attainment.” (Knott, 2008, 2006) In these earlier presentations, satisfaction (or happiness) was conceived as a situation in which a “striven for” want changes to an “attained” want. When the thing or state striven for by the actor is attained, this constitutes happiness or satisfaction for the individual. This is a formal conception and does not refer to the particular or concrete content that may be striven for or attained. Consciousness was conceived as a simple intentional structure in which striven for things are continually changing to attained things constituting the experience of satisfaction or happiness for the individual concerned. Unhappiness or dissatisfaction was conceived as the reverse situation in which an “attained want” changes to a “striven for want” for the individual. Thus, there were two conceived states which the entities of intentional consciousness could “occupy.” For an actor, an entity may be “attained” or an entity may be “striven for.” These were conceived as the two primary categories of intentional consciousness (categories of action).

How is an actor aware that a thing he has striven for has become a thing attained? The answer given is that “attainment” entails the “presence” of a perception or observation. A person “attains” ice cream when a person sees or holds or tastes ice cream. A person “attains” approval when a person hears, reads, or observes approval. We conceive that the observation or perception of an entity by an individual is identical to the individual’s “attainment” of that entity. Here, the individual “attains” an object not in a normative or social or legal sense, but rather in a perceptual or observational sense. Those things that enter the conscious field of the individual (those things the actor perceives, observes, or senses) are “attained” by him. And as indicated, things are attained as satisfaction for the individual. Or, for the individual consciousness, “attainment” constitutes satisfaction.

The insight giving rise to the theory of interpersonal action was that if attainment constitutes satisfaction, and if there are entities that cannot be attained, then such entities may impact the happiness of the consciousness that strives to attain them.

The defining characteristic of “direct” social interaction (which we refer to as interpersonal action) is when the mind of another actor (B) is the object of actor A‘s action. Given the two categories of consciousness—striving and attainment—the mind of actor B must either be striven for or attained by actor A. (To understand our meaning it may be helpful to think in terms of the thoughts or intentions of actor B. When we speak of the “mind” or “consciousness” of actor B, we’re referring to the unobserved (by A) thoughts and intentions of B as contrasted to the
observable aspects of B.) If actor A can “strive” for the thoughts and intentions of actor B but cannot “attain” them, then in some sense yet to be defined, such striving cannot result in happiness for actor A.

The original conception was that market transactions in which an actor does not refer to the mind of another person are somehow “objective.” An example is a transaction in which the actor deposits a coin in a vending machine. In this transaction, the actor interacts with a physical coin and a physical vending machine and need not refer to the thoughts or intentions of another actor. By contrast, when one actor coerces another, he must manipulate the “wants” of the other actor in order to do so (i.e., in order to coerce person B, I must change the goals of person B so that person B gives me what I want). The goals of person B (his intentions, purposes, thoughts, etc.), as mental phenomena of person B, are not “objective” to me in the same way that a physical coin or vending machine is “objective” to me. And this suggests that when I seek to coerce another person by seeking a change in the mind of that person, I cannot “attain” this change in the same way I can attain an item from a vending machine. My striving for the mental entities of another person cannot result in their attainment (as happiness) in the same way that my striving for physical objects can result in their attainment (as happiness). This suggested a possible reason, grounded in action/consciousness categories, why an actor may prefer “objective” market exchanges over coercive exchanges.

The theory is an attempt to provide a “scientific” basis for certain libertarian intuitions about social interaction and the market process. Libertarian social theory advocates the market economy over the command economy. And libertarian social theory generally objects to the use of coercion as a means of social exchange. The question is whether a basis for these preferences can be found in human nature.

Part 3 – Interpretation

A.

The theory of interpersonal action explains the libertarian preference for market society in terms of the structure (the categories) of consciousness (what Mises referred to as the structure or categories of action). Libertarian economic theory explains the preference for market society in terms of the abundance or paucity of goods, the efficiency or inefficiency of the distribution of goods, and the impact on standards of living resulting from policies intended to restrict or influence market transactions. Libertarian ethics theory explains the preference for market society in terms of ethical conduct. Market society is the corollary of good or just social conduct; the command society is the corollary of evil or unjust social conduct.

The theory of interpersonal action provides an explanation of the libertarian preference for market society that is independent of the material (the “economic”) circumstances of any individual or society. It also provides an explanation of the libertarian preference for market society that is independent of social analysis from an ethical or moral point of view. The significance of the market society is that it is a technique or method for conducting social interaction without engaging in interpersonal action. As market society evolves and expands—beginning with the simple posting of prices, evolving to the introduction of mechanical and electronic vending machines, and evolving further to electronic commerce—the individual is ever more enabled to conduct social exchanges without engaging in interpersonal action. As the market evolves and expands, methods of social interaction that do not require interpersonal action evolve and expand. The individual interacts with posted prices, with automated vending machines, and with computer technology.

From an objective point of view (from the point of view of an observer of the market as a whole), the individual (A) who interacts with market technology engages in social interaction, because other people (B) come into contact with this same technology at an earlier or later time. At some point in time, person B posts the price that actor A now observes; at some point in time, person B re-fills the vending machine that actor A now uses; at some point in time, person B fulfills the Internet order that actor A now places. However, from the point of view of actor A
at the time of his action, each of these transactions or interactions may be conducted without reference to the mind or consciousness of another person. In one sense (in the objective sense) the actor who interacts with market technology is engaged in social interaction. In another sense (in the subjective sense) the actor who interacts with market technology is not engaged in social interaction; he interacts with an inanimate object. The significance of market society is that it is a technique for engaging in social interaction without engaging in interpersonal action. And this is the basis for the libertarian preference for the market society. Market technology—the price system, automated transactions, electronic communications and transactions, etc.—is a method by which an individual may avoid the dissatisfaction or unhappiness inherent in interpersonal action while still enjoying the benefits of social interaction and social exchange.

B.

Interpretation continued

The theory does not imply that one ought or ought not engage in interpersonal action. Instead, it implies that the libertarian preference for market society has a basis in the categories of consciousness (categories of action). Referring to the categories of his consciousness, an actor may come to associate various actions with a given category of action. For example, an actor may associate the action of eating ice cream with satisfaction or happiness, while the same actor may associate the action of interacting with another person (interpersonal action) with dissatisfaction or unhappiness.

It is not maintained that an actor must associate any particular kind of action with a particular category of action; it is only maintained that he may do so. If conscious actors do indeed make these kinds of associations, this may explain why they choose or prefer some methods of social interaction over others, and why they believe that some developments in society constitute “progress” while other developments in society constitute “decline” or “decay.”

If a person associates interpersonal action with dissatisfaction or unhappiness, and if he associates methods of social interaction that do not entail interpersonal action with satisfaction or happiness, then he may interpret a situation in society in which market technology is expanding as “social progress,” and he may interpret a situation in society in which market technology is contracting as “social decay” or “social decline.”

Our thesis is that the phenomenon we have historically referred to as “market society” or as the “evolution of market society” is the development of forms of social interaction that do not require interpersonal action. According to this interpretation then, the phenomenon of prices (“market prices”) is a historical example of this development and evolution, but not an essential characteristic of it. The introduction or emergence of prices (“the price system”) was, according to our interpretation, one concrete historical instance of a broader phenomenon: the development and evolution of forms of social interaction that obviate the need for interpersonal action.

From this point of view, the significance of prices is not their role in allocating goods and services spatially and temporally among various people. Rather, the significance of prices is to be seen in the role they play in the consciousness of the actor who posts or observes a price. The one who posts a price may do so without engaging in interpersonal action. Similarly, the one who observes a price may do so without engaging in interpersonal action. The written price thus enables social interaction to occur without interpersonal action. Seen in this light, the “price system” is a historical example of a broader evolutionary process in which forms of social interaction are developed that obviate the need for interpersonal action. From this point of view, the price system is not significant because its utilization leads to greater material well-being. Instead, the price system is significant because the actor who employs it as a method of social interaction may consider it more personally satisfying than “direct” interpersonal action. The actor may associate the written price, qua perceptual object, with the category of satisfaction, and he may associate the mind of another person, qua nonperceptual presence, with the category of dissatisfaction. The actor may therefore tend to choose social interaction via the price system as it seems to him personally satisfying, and he may tend to avoid social interaction via interpersonal action as it seems to him personally unsatisfying.

C.

Interpretation of Social Evolution

A recurring theme of libertarian social theory is the relationship between the self-interested actions of individuals, the expansion of market phenomena, and the improvement in mankind’s condition.

Consider Adam Smith’s invisible-hand metaphor:

As every individual, therefore, endeavors as much as he can both to employ his capital in the support of domestic industry, and so to direct that industry that its produce may be of the greatest value; every individual necessarily labors to render the annual revenue of the society as great as he can. He generally, indeed, neither intends to promote the public interest, nor knows how much he is promoting it. By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was no part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it. (AS-456)

The individual, pursuing only his own gain, unintentionally also “promotes the public interest.” If we consider Carl Menger’s explanation of the origin of money, the same notion is present:

As each economizing individual becomes increasingly more aware of his economic interest, he is led by this interest, without any agreement, without legislative compulsion, and even without regard to the public interest, to give his commodities in exchange for other, more saleable, commodities, even if he does not need them for any immediate consumption purpose. With economic progress, therefore, we can everywhere observe the phenomenon of a certain number of goods, especially those that are most easily saleable at a given time and place, becoming, under the powerful influence of custom, acceptable to everyone in trade, and thus capable of being given in exchange for any other commodity. These goods were called “Geld” by our ancestors, a term derived from “gelten” which means to compensate or pay. Hence the term “Geld” in our language designates the means of payment as such.(POE-260)

Both of these passages conceive a relationship between self-interested individual action and some economic or market-related benefit to society. In Smith’s case, the benefit is the increase in the revenue or capital of society, and in Menger’s case, the benefit resulting from self-interested individual action is the emergence and evolution of money. The two essential components of this kind of theory are: 1) the concept of individual, self-interested action, and 2) a social benefit that results from this self-interested action but which was not the intention of the actor performing the action. Mises too provides an account of social evolution based on self-interested action:

The task with which science is faced in respect of the origins of society can only consist in the demonstration of those factors which can and must result in association and its progressive intensification. Praxeology solves the problem. If and as far as labor under the division of labor is more productive than isolated labor, and if and as far as man is able to realize this fact, human action itself tends toward cooperation and association; man becomes a social being not in sacrificing his own concerns for the sake of a mythical Moloch, society, but in aiming at an improvement in his own welfare. Experience teaches that this condition—higher productivity achieved under the division of labor—is present because its cause—the inborn inequality of men and the inequality in the geographical distribution of the natural factors of production—is real. Thus we are in a position to comprehend the course of social evolution. (HA-160)

For Smith, the individual, in increasing the value of his capital, unintentionally increases the revenue of society. For Menger, the individual, in trading for more marketable goods, unintentionally fosters the development of money. For Mises, the individual, in recognizing the higher productivity of his labor under the division of labor, is led to intensify association and social cooperation. Thus, an important focus of libertarian social theory is the relationship between individual action and the evolution of the market. The question is: what factors within the conscious field of the individual actor steer him toward those actions that constitute the market? The present theory suggests an answer to this question that is independent of historically-conceived market phenomena such as capital, labor, revenue, money, productivity, division of labor, interest, etc.

D.

The Relationship between the Theory of Interpersonal Action and Libertarian Social Theory

One of the central concerns of libertarian social theory, as distinct from libertarian economics, is the use of coercion in social exchange. Coercion as we define it is distinct from other forms of harm such as violence, assault, and aggression. By “coercion” we mean a specific kind of trade or exchange. When I coerce someone, I take something (X) away from another person (or threaten to do so), with the intention of offering X back to that person in an exchange for something I want. In the prototypical coercive exchange, I point a gun at another person (B) and exclaim: “Give me Y or I’ll shoot.” My goal in such an exchange is to obtain Y by offering X (in this case, B‘s well-being) to person B in exchange. As I believe that B already has X (as I believe B already has his well-being), I take X away from B, or threaten to do so, and then offer X back to B in exchange for Y, my ultimate goal. This is the universal form of the coercive exchange.

The coercive exchange is central to libertarian social theory because it is the primary means by which nonlibertarian society prevents libertarian society from emerging. Libertarian society is not prevented by daily acts of violence against libertarians. Libertarian society is prevented by means of coercive exchanges. The nonlibertarian (A) wants Y (generally, for the libertarian to obey all the rules of nonlibertarian society). The libertarian (B) wants X (generally to avoid physical harm and imprisonment). As A believes B already has X (i.e., as the nonlibertarian believes that the libertarian is not currently suffering harm and/or is not currently imprisoned), A threatens to take X away from B, and then offers X back to B in exchange for Y. Thus, nonlibertarian society is maintained, and libertarian society prevented, by means of coercive exchanges.

To conduct a coercive exchange, I must locate, in the field of my consciousness, another being possessing the same categories of consciousness as myself (i.e., an entity “possessing” the categories of happiness/unhappiness, pleasure/pain, satisfaction/dissatisfaction, etc.). Knowing how these categories function in my own consciousness, I intend to apply this knowledge toward the manipulation of these same categories in B‘s consciousness, in order to attain some goal of mine. To do so, I must locate within the field of my consciousness, being B, a being in possession of the same consciousness categories I possess. The “locating” or “appearance” of another consciousness B, within the field of my own consciousness, is the essential characteristic of (is our definition of) interpersonal action. And thus, for me, A, the means of coercion necessarily requires interpersonal action. To conduct a coercive exchange I must locate another consciousness (another consciousness must “appear”) within my conscious field.

(It is important to remember that we are here referring to a subjective and not an objective “location” of another consciousness. In our meaning, I “locate” another consciousness not by ascertaining the spatial coordinates of another human body; rather I “locate” another consciousness in the subjective sense when another consciousness appears in some part of my conscious field. Furthermore, the other consciousness does not appear to me in the observational sense just as the back of the wall does not appear to me in the observational sense. The other consciousness appears as an unperceived presence, i.e., as something co-present with my current perceptions, observations, or sensations.)

To the extent I socially interact via market technology (as distinct from interpersonal action), another consciousness does not appear within my conscious field. As coercion requires the appearance of another consciousness within my conscious field, social interaction via market technology precludes coercion in the subjective sense (i.e., when I’m interacting with a written price, with a vending machine, or with a computer, I am not engaged in interpersonal action, and thus, not engaged in coercion in the subjective sense). An expansion of social interaction via market technology implies a correlative contraction in interpersonal action, the prerequisite or necessary condition of coercion.

The present theory provides a new insight into the relationship between the market on the one hand, and the notion of “coerced” versus “uncoerced” exchanges on the other hand. How is the market related to the diminishment of coerced exchanges? Our answer is that in a market exchange the coerced/uncoerced distinction does not apply because we define market exchange as social interaction that does not entail interpersonal action. Thus, social interaction via market technology tends to diminish coercive exchanges because in a market exchange there is no interpersonal action and therefore coercion, as we define it, cannot occur. Expansion of the market system diminishes coercive exchanges by replacing interpersonal action with forms of social interaction that do not entail interpersonal action, and in which therefore, the phenomenon of coercion cannot arise.

 

KEY

AS – Smith, An Inquiry Into the Nature and Causes of the Wealth of Nations, 1981

HA – Mises, Human Action, 1966

MM – Mises, Money, Method, and the Market Process, 1990

POE – Menger, Principles of Economics, 1994

TH – Mises, Theory and History, 1985

July 14, 2014 / Adam Knott

Some Thoughts on Praxeology, Thymology, and the A Priori

PRAXEOLOGY

The discipline that Ludwig von Mises named praxeology derives from Carl Menger’s conception of “exact science” or “exact research.” For one interested in studying praxeology, Carl Menger’s Investigations into the Method of the Social Sciences is required reading. In Book 1, Chapters 1-5, Menger lays out his conception of scientific laws in terms of two kinds of regularities: exact laws and empirical laws.

The types and typical relationships (the laws) of the world of phenomena are not equally strict in all cases. A glance at the theoretical sciences teaches us rather that the regularities in the coexistence and in the succession of phenomena are in part without exception; indeed they are such that the possibility of an exception seems quite out of the question. However, some are such that they do indeed exhibit exceptions, or that in their case exceptions seem possible. The first are called laws of nature, the latter empirical laws.

Regarding the study of exact laws (what Mises calls praxeology), Menger writes:

The aim of this orientation, which in the future we will call the exact one, an aim which research pursues in the same way in all realms of the world of phenomena, is the determination of strict laws of phenomena, of regularities in the succession of phenomena which do not present themselves to us as absolute, but which in respect to the approaches to cognition by which we attain to them simply bear within themselves the guarantee of absoluteness. It is the determination of laws of phenomena which commonly are called “laws of nature,” but more correctly should be designated by the expression “exact laws.”

…exact research solves the second problem of the theoretical sciences: the determination of the typical relationships, the laws of phenomena. The specific goal of this orientation of theoretical research is the determination of regularities in the relationships of phenomena which are guaranteed to be absolute and as such to be complete.

[Exact science] arrive(s) at laws of phenomena which are not only absolute, but according to our laws of thinking simply cannot be thought of in any other way but as absolute. That is, it arrives at exact laws, the so-called “laws of nature” of phenomena.

Mises’s concept of praxeology consists of two primary components. The first component is the assumption of action, which means the assumption that a conscious actor attempts to replace the situation that confronts him/her with a (hopefully) more satisfactory situation. The second component is the notion of “exactness” or “apriority” or “certainty.” This means that praxeology is only concerned with those things that must necessarily occur when an actor attempts to replace one situation with another, not with those things that may or may not occur. In other words, praxeology is concerned with exact laws (not empirical laws) as applied to the actor’s attempt to change his/her current situation to something more satisfactory.

If I walk toward a location (action A), I may or may not arrive there (result or consequence B), and thus the relationship between my action and its result in this case is an empirical or nonnecessary relationship. On the other hand, if I walk toward a location (action A), I necessarily walk away from a different location (result or consequence B), and thus the relationship between my action and its result in this case is an exact or necessary relationship. The focus of praxeology is this latter type of “exact” relationship. As Mises writes:

Praxeological knowledge makes it possible to predict with apodictic certainty the outcome (B) of various modes of action (A). (HA, 3rd rev. ed. p. 117)(“A” and “B” added)

 

THYMOLOGY

To better understand the term thymology, let us go back fifty or sixty years to the time when Mises was writing Human Action, Theory and History, and The Ultimate Foundation of Economic Science. In these and other works Mises had put forth his concept of human action:

In an a prioristic science, we start with a general supposition—action is taken to substitute one state of affairs with another…The aim of action is to substitute a state of affairs better suiting the men taking the action than the previous situation. (FM, p. 16-17)

Though Mises’s conception of action is general in nature, and though his conception of action provides a foundation for studying all types of actions, as an economist, Mises was concerned with only one kind of action: the so-called “catallactic actions”—those actions based on monetary calculation.

…the field of catallactics or of economics in the narrower sense is the analysis of the market phenomena. This is tantamount to the statement: Catallactics is the analysis of those actions which are conducted on the basis of monetary calculation. (HA, 3rd rev. ed. p. 234)

In Human Action, Mises lays the foundation of his economics in terms of the concepts of action and praxeology (the famous “first two hundred pages of Human Action”). Once this is accomplished, the remainder of Human Action then deals with “catallactic actions”—generally, actions in which the actor takes account of market prices:

There have never been any doubts and uncertainties about the scope of economic science. Ever since people have been eager for a systematic study of economics or political economy, all have agreed that it is the task of this branch of knowledge to investigate the market phenomena, that is, the determination of the mutual exchange ratios of the goods and services negotiated on markets, their origin in human action, and their effects upon later action. (HA, 3rd rev. ed. p. 232)

We may conceive that economics is the study of those actions in which the actor may obtain a supply or relinquish from a supply (or stock) of identical units. The law of marginal utility, the central law of Austrian economics, is concerned exclusively with such actions. Economics, the study of the money economy, is based on the assumption of identical monetary units. The law of returns, another important economic law, utilizes simple mathematical equations (p/c, 3p, p > q, p-1, etc.) based on the assumption of identical units of stock or supply. Economics deals with action under the conditions of identical units of supply. The assumption of identical, countable, units of supply, implies the application of simple or complex mathematical equations. For example, in explaining the law of marginal utility, Mises employs the simple mathematical equation n-1.

Thus, economic science is focused on a relatively narrow range of human actions and many important kinds of actions are outside the scope of economics proper. Two of the most important kinds of actions not treated by economics are mental actions (actions such as thinking, choosing, deliberating, contemplating, reasoning, etc.) and interpersonal actions (actions involving the mind of another, second actor).

If we look back upon the Austrian economics literature of the last fifty years, there is very little mention of these other important realms of action, and little realization that these realms of action could constitute new fields for praxeological study. For example, on the subject of mental actions we have, from Mises:

…thinking itself [is] an action, proceeding step by step from the less satisfactory state of insufficient cognition to the more satisfactory state of better insight. (HA, 3rd rev. ed. p. 99)

And from David Gordon we have:

Some “actions” don’t seem to involve physical movement, e.g., thinking. (GOR, p. 19)

And

If, for example, I think of a chair, my mental action is not a picture of the chair found in my mind. What my mind does is to think of an object. Thinking is an action, a mental “doing” as it were. (GOR96, p. 5)

These passages apparently constitute the Austrian literature on the subject of mental actions some sixty years after the publication of Human Action.

The failure to recognize realms of action outside the scope of economic science has, obviously, greatly inhibited the advance of praxeology. As mentioned, there has been almost no praxeological study of mental actions, and most libertarians and Austrians chose to approach the realm of interpersonal action as a normative, not a praxeological, discipline. Rather than trying to conceive scientific or exact laws that apply when one actor acts toward another, they tried to prove that various actions are just or unjust, good or bad, moral or immoral, etc.

And this leads us to our current topic, thymology. Because there was no recognition of realms of action outside the scope of economics, praxeological study of other forms of action was necessarily inhibited. Because there has been virtually no praxeological study of mental actions, our understanding of the relationship between praxeology and thymology has not improved over the last sixty years. To see how this is so, let’s take a straight-forward description of thymology from The Ultimate Foundation of Economic Science:

[Thymology] deals with the mental activities of men that determine their actions. It deals with the mental processes that result in a definite kind of behavior, with the reactions of the mind to the conditions of the individual’s environment. (p. 48)

This description of thymology seems reasonable enough. On the one hand there are the actions that individuals will undertake or perform. On the other hand, there are the mental activities and processes that precede or determine these actions. This seems to be a perfectly natural and reasonable description. However, we have to remember that Mises’s description and conception of thymology was formulated before there was any meaningful literature on the subjects of mental or interpersonal actions. Mises is writing in an intellectual atmosphere in which there has been no serious praxeological scholarship concerning mental actions.

Because there is no praxeological scholarship available to Mises on the subject of mental actions, his knowledge in this area is deficient and incomplete. He thus conceives “the mental activities and processes that that result in a definite kind of behavior” as something other than action. Because Mises doesn’t have a clear or firm conception concerning mental actions, he conceives mental actions (mental “doings” as it were) as phenomena essentially different from the actions that follow these mental doings. He fails to see clearly that “mental doings” are simply actions of a certain kind.

Once we conceive that mental activities and mental doings are actions, we can see that in referring to thymology, Mises is referring to the content of mental actions.

In speaking of thymology, Mises is explicit in identifying thymology with mental phenomena. He doesn’t yet think of mental phenomena as mental actions because as an economist all his time has been spent focusing on catallactic actions. He hasn’t had time to intensively ponder the nature of other forms of action such as mental actions and interpersonal actions. What he does is to contrast thymology with praxeology. Since praxeology is concerned with the universal aspects of conduct, thymology, as contrasted to praxeology, cannot be concerned with the universal aspects. If the focus of thymology is mental activities, but not their universal aspects, then the focus of thymology in the Misesian conception must be the contentual, concrete, nonuniversal aspects of mental activities. Mises’s conception of thymology is what we would today refer to as the study of the contentual, empirical, or nonnecessary aspect of mental actions; those aspects of mental activity that are not necessarily present in every instance of mental activity.

Mises, without the benefit of any parallel scholarship concerning mental actions, conceived or implied that mental activity is something different from action, and he thus conceived thymology as a discipline concerned with a kind of non-action realm of human activity. By contrast, once we conceive mental doings as actions, and given that praxeology studies the universal aspects of these actions, we can see that Mises’s conception of thymology is largely identical to the study of the concrete, individual, and historical aspects of mental actions. These and other insights can only come about upon the realization and recognition of forms of action aside from those studied by economics.

As a closing example, let’s take one of Mises’s descriptions of thymology from Theory and History:

The very act of valuing is a thymological phenomenon. But praxeology and economics do not deal with the thymological aspects of valuation. Their theme is acting in accordance with the choices made by the actor. The concrete choice is an offshoot of valuing. But praxeology is not concerned with the events which within a man’s soul or mind or brain produce a definite decision between an A and a B. It takes it for granted that the nature of the universe enjoins upon man choosing between incompatible ends. Its subject is not the content of these acts of choosing but what results from them: action. (p. 271, emphasis added)

First, Mises states that the subject matter of praxeology is not the content of acts of choosing. He thus holds that there are acts of choice that have concrete content. This implies, as has been argued, that Mises’s conception of thymology refers to the content of mental acts (mental actions) such as valuing, choosing, etc.

Second, the fact that Mises here refers to “acts of valuing” and “acts of choosing” is further corroboration that “events which within a man’s soul or mind or brain produce a definite decision” are to be conceived as actions.

Third, Mises writes that “praxeology and economics do not deal with the thymological aspects of valuation” (i.e., with the content of acts of valuation). This is consistent with a conception in which praxeology does deal with the praxeological aspects of valuation, which of course implies that valuation, as a mental activity, is an action.

Once we establish the conception of mental actions, then thymology, as distinct from praxeology, can be one of, or a combination of, the following disciplines:

1. Study of the content of mental actions. (Mises’s original conception)

2. Study of the content of actions generally (not merely the study of the content of mental actions).

3. Study of a number of actions in sequence (e.g., the effect that one actor’s action has on the action of another actor, or the effect that an actor’s action has on a subsequent action of his/her own).

Definitions 2 and 3 derive from the idea to conceive thymology negatively in relation to praxeology. I.e., thymology defined as the study of the nonpraxeological aspects of action.

THE A PRIORI

One of the unsettled problems of Austrian economics concerns the nature of the a priori and a priori knowledge. The question is whether a priori knowledge refers primarily to the relationship between concepts or to the relationship between phenomena that may be experienced by a human consciousness. The solution to this problem is important for praxeology because praxeology claims to seek, or claims to be based upon, a priori knowledge.

There can be little doubt that the aim of praxeology is to establish an “exact” or “necessary” relationship between two nonidentical phenomena A and B, such that the successful production of phenomenon A must necessarily also bring about phenomenon B. As Mises writes:

The starting point of experimental knowledge is the cognition that an A is uniformly followed by a B. The utilization of this knowledge either for the production of B or for the avoidance of the emergence of B is called action. The primary objective of action is either to bring about B or to prevent its happening. (UF, p. 20)

And

Praxeological knowledge makes it possible to predict with apodictic certainty the outcome (B) of various modes of action (A). (HA, 3rd rev. ed. p. 117)(“A” and “B” added)

The primary aim of praxeology is not merely to establish necessary relationships between concepts or ideas, but to discover the necessary results or consequences of the actions that we undertake. For example, central to Mises’s conception of the Austrian Theory of the Business Cycle is the notion that the results (B) of manipulating the market rate of interest (A) must necessarily occur. Mises holds that the essential relationships underlying economics, as a branch of praxeology, are “exact” and not “empirical” relationships. Mises says: “If you do A, the occurrence of B is unavoidable.” However, the precise nature of this a priori or exact knowledge is problematic on an epistemological level, and this can be easily seen by considering a passage in which Mises touches on the essential problem:

For example, we deduce from our theory that when the price of a commodity rises (A), its production will be increased (B). However, if the expansion of production necessitates new investment of capital, which requires considerable time, a certain period of time will elapse before the price rise brings about an increase in supply. And if the new investment required to expand production would commit capital in such a way that conversion of invested capital goods in another branch of production is altogether impossible or, if possible, is so only at the cost of heavy losses, and if one is of the opinion that the price of the commodity will soon drop again, then the expansion of production (B) does not take place at all. (EP, p. 163)(italics, bold, and A’s and B’s have been added)

We can see that Mises is here describing praxeological theory. He is speaking about a deduced (not an inductive) relationship between two nonidentical phenomena, A and B. Mises’s clear meaning is that if A happens B must also necessarily happen. However, we can see that Mises writes near the end of the passage that it is possible that A may happen and yet B may “not take place at all.” This is obviously a shortcoming in the theory. If upon A’s occurring, phenomenon B may or may not take place, then we must write:

…when the price of a commodity rises (A), its production might be increased (B).

If upon A’s occurrence, B may or may not occur, this constitutes a contingent and not a necessary relationship. We are now describing an empirical law and not an exact law.

Let’s consider Mises’s definition of a priori knowledge:

But the characteristic feature of a priori knowledge is that we cannot think of the truth of its negation or of something that would be at variance with it.

If we qualify a concept or a proposition as a priori, we want to say: first, that the negation of what it asserts is unthinkable for the human mind and appears to it as nonsense…(UF, p. 18)

By this standard then, the relationship between the increased commodity price (A) and the increase in production of the commodity (B) cannot be an a priori relationship, because Mises himself has provided an explanation of how A could happen without the occurrence of B. If the relationship between A and B were an a priori relationship, it should, according to Mises, be impossible for the human mind to think of A happening without B also happening. The idea that A could happen and not B should be unthinkable for the human mind and appear to it as nonsense.

This theoretical problem was the basis for Hayek’s claim that Mises was wrong to hold that market theory is a priori. Hayek believed that Mises was wrong to hold that there can be exact laws or a priori knowledge concerning market processes. He argued that market theory can only be empirical (can only deal in contingent, nonnecessary relationships).

To see the problem from a different angle, let us return to the notion of mental actions. Mises’s contemporary Alfred Schutz wrote in passing about the action of observation:

For it is obvious that an action has only one subjective meaning: that of the actor himself. It is X who gives subjective meaning to his action, and the only subjective meaning begin given by F and S in this situation are the subjective meanings they are giving to their own actions, namely, their actions of observing X. (PSW, p. 32)

Thus, “observation” is an action; it is something an actor may consciously or purposely do. I can apply the notion of ‘observation as an action’ to Mises’s passage above in the following way. I imagine that I observe an increase in a commodity price (act of observation A). I then assume that a period of time elapses after which I attempt to observe whether production of this commodity has been increased as predicted by theory. I can only do so by means of a separate act of observation B. However, in Mises’s conception, the concrete content of two separate actions—the relationship between the content of one action and the content of a second action—lies outside the scope of praxeology. Only the pure, universal form of action is the object of praxeological study, not the different contents of various actions.

If we assume that the commodity price increase (A) and the increased production of the commodity (B) are not part of a single action, then their respective occurrences must take place in the context of two separate actions, and praxeology does not treat the relationship between two actions.

A commodity price increase and an increase in a commodity’s production are obviously not identical phenomena. These phenomena differentiate the actions in which they occur. They are not universal features of each and every action, but rather concrete contents of specific actions. Thus, these two phenomena, as contents of specific actions, lay outside the scope of praxeology proper.

What conclusions may we draw from these considerations? In the attempt to conceive exact laws of human action, we should perhaps bring more focus to bear on those regularities in which A and B are part of the same action. When I walk toward a location (conscious action A), I necessarily walk away from a different location (exact or a priori result B). The necessary relationship in this case is due to the fact that A and B are considered part of the same action with no conceived temporal separation between them.

Part of the solution lies in a conception of action that does not equate action with physical movement, but instead identifies action with the intention of the actor. The intentional conception of action, especially as explained by Friedrich Hayek in his essay “The Facts of the Social Sciences,” and by John Searle in his book Minds, Brains and Science, is the key to a deeper understanding of human action and the intentional nature of consciousness.

Key
EP – Mises, Epistemological Problems of Economics, 1976
FM – Mises, The Free Market and Its Enemies, 2004
GOR – Gordon, An Introduction to Economic Reasoning, 2000
GOR96 – Gordon, “The Philosophical Origins of Austrian Economics,” 1996
HA – Mises, Human Action, 3rd rev. ed., 1966
PSW – Schutz, The Phenomenology of the Social World, 1967
UF – Mises, The Ultimate Foundation of Economic Science, 2002

 

November 10, 2013 / Adam Knott

The Structural Difference between Social Science and Natural Science – Part 2b: The Content of Conscious Action Contrasted to the Form of Conscious Action (the a posteriori and the a priori)

The Content of Conscious Action Contrasted to the Form of Conscious Action (the a posteriori and the a priori)

The focus of praxeology is exact laws of conscious action.  A law is a regularity in the association of two nonidentical phenomena, A and B, such that when A happens or occurs, B happens or occurs.  Following Menger we distinguish between two fundamental types of regularities—exact laws and empirical laws:

The types and typical relationships (the laws) of the world of phenomena are not equally strict in all cases.  A glance at the theoretical sciences teaches us rather that the regularities in the coexistence and in the succession of phenomena are in part without exception; indeed they are such that the possibility of an exception seems quite out of the question.  However, some are such that they do indeed exhibit exceptions, or that in their case exceptions seem possible.  The first are called laws of nature, the latter empirical laws. (I-50)(note: laws of nature for which no exception seems possible Menger terms “exact laws”)

Eddington terms a “law of nature” a “regularity which we have found in our observational knowledge, irrespective of its source.” (PPS-67)  When he writes “irrespective of its source,” Eddington means the regularity as such, regardless whether we interpret the regularity as a regularity of objective nature or as a regularity that is a function of our “intellectual equipment” used in observing nature.

In physical science, the regular relationship in question is that between (A) an observational procedure and (B) the results of that observational procedure:

Clearly a statement cannot be tested by observation unless it is an assertion about the results of observation.  Every item of physical knowledge must therefore be an assertion of what has been or would be the result of carrying out a specified observational procedure. (PPS, 9-14)

As an observational procedure we might imagine the arrangement of equipment to various technical specifications, the initiation of some chemical or electrical process, and the observation of the results of having done these things; either direct observation, or observation of the readings of a measuring device.  Regardless of the specific observational process, the universal form of such a process will be:

Do A, and you will observe B.

Or

Do a, b, and c, and you will observe d.

The procedure involves specifying a series of activities (A) and the results (B) that will be observed if those activities are performed.

Of course, in the theory of action a procedure is simply another name for an action or a series of actions.   A procedure is simply a specific or defined intentional activity or series of intentional activities.  Thus, when we say that physical knowledge involves a relationship between an observational procedure and the results of that procedure, we are saying that physical knowledge involves a relationship between a specified action (or series of actions) and the result of that action.  If this is correct, then economics in its common meaning is similar to physical science in its attempt to ascertain the results of various “economic actions”—actions having to do with the money economy.  For example, economics is interested in the relationship between (the action of) currency creation on the one hand, and the resultant effect on prices on the other hand.  Or, economics is interested in the relationship between (the action of) interest rate manipulation on the one hand, and boom and bust cycles on the other hand.  Both currency creation and interest rate manipulation are “procedures” in the general sense of the term.  Both of these activities, as with the procedures of physical science, may be defined or specified such that they may reproduced or repeated by ourselves or others.  When we are in possession of the definition of currency creation or interest rate manipulation, we are thus enabled to identify this activity when it occurs in spatial nature (i.e., we can locate a person(s) who is doing this activity, and a time and place where this activity is being performed or has been performed).  The point is that with regard to the general knowledge form “activity A leads to result B,” physics (Eddington’s description of it) and economics (in its common meaning) are identical.  Both physics and economics treat the relationship between a specified procedure or action and the results of that procedure or action.

When speaking of the results of various activities in the common understanding, there are at least two things that are not meant by “results.”  First, when we speak of the results of an activity, we do not mean the “co-present” results of an activity.  I.e., we do not mean by “results” some phenomenon B which occurs cotemporaneously with the given activity A.  In the common understanding, when we say “results” we mean the “and then” results: first do a, then do b, then do c, and then d will result.  Simply stated, by “results” we mean the time-separated consequence B, of the temporally prior action or procedure A.

Second, when we speak of results, and especially of observed results, we mean that the time-separated result (B) is in some sense independent of the observational or intellectual “equipment” (OE) such that the presence of OE does not guarantee the presence of B.  For example, we might instruct: “Walk to the top of that mountain and look down into the valley.  [The result is] you will see an olive grove.”  By contrast, we would not instruct: “Walk to the top of that mountain and look down into the valley.  [The result is] you will experience extended space.” (Here we assume for illustrative purposes that experiencing extended space is part of the activity of looking.)  By “result” B we commonly mean an assumed act of observation in which B may or may not “present” (in which B may or may not appear or take place).  By “result” B we do not mean a thing X that must be present in any observation because it is part of the activity of observing.  As another example, let’s assume that the specified result B of some activity A has to do with market prices.  We might then instruct: “Read the report and [the result is] you will see that prices have increased.”  We would not instruct: “Read the report and [the result is] you will experience differentiated perceptions.” (Assuming for illustrative purposes that conscious activity generally entails differentiated perceptions.)  When we speak of “results” in the common meaning, we mean something X that may or may not be part of the conscious activity in question, not something that by its nature must be part of every conscious activity.

It seems that if we define “results” a priori so as to exclude 1) the co-present aspects of any conscious activity, and 2) those aspects of consciousness necessarily entailed in verifying the results of any conscious activity, that we have thereby defined “results” as the a posteriori, or contingent, or empirical, aspect of any conscious activity.  If the notion of “result” is defined in this way, then there can be, by definition, no a priori or necessary results of any conscious activity.  Thus, an understanding of what we mean by the “results” of an activity is important.  There can be no a priori knowledge if by knowledge we mean exclusively the a posteriori aspects of any conscious activity.

If we consider again Eddington’s definition of physical knowledge:

Clearly a statement cannot be tested by observation unless it is an assertion about the results of observation.  Every item of physical knowledge must therefore be an assertion of what has been or would be the result of carrying out a specified observational procedure.

We can see how important the precise meaning of “results” is.  It seems clear that the common conception of physical knowledge does not refer to the co-present (non-time-separated) features of physical-scientific procedures.  Nor does it refer to those features of consciousness that are necessarily entailed in verifying the results of physical-scientific procedures.  If this is correct, then the common definition of physical knowledge (which many consider identical to “scientific” knowledge) may be identical to the common definition of a posteriori (or contingent or empirical) knowledge.

Eddington’s proposition is that the fundamental physical laws are a priori:

All the laws of nature that are usually classed as fundamental can be foreseen wholly from epistemological considerations.  They correspond to a priori knowledge, and are therefore wholly subjective. (PPS-57)

However, if we define physical knowledge in terms of the results of observation, and if our definition of “results” is identical to our definition of a posteriori knowledge, then we have defined physical knowledge as a posteriori knowledge.  Eddington’s conception of physical knowledge is then in logical conflict with his contention that the fundamental physical laws (a kind of physical knowledge) are a priori.  In other words, as indicated previously, Eddington’s definition of physical knowledge excludes the possibility of physical knowledge being a priori.  If there are fundamental a priori laws (for example, a priori laws of consciousness), these laws cannot be physical laws if we accept Eddington’s definition of physical knowledge as the a posteriori aspects of conscious scientific activity.

When we turn our attention to economics as a branch of praxeology, these same principles apply.  Let’s assume we assert that doing A will result in B (e.g., doing A will result in a slump, or a boom, or in an increase in prices).  We then exclude from our definition of “results” 1) the co-present, cotemporaneous, aspects of action A, and 2) those elements of consciousness necessarily entailed in any cognition, perception, or observation of B.  We have thus defined “results,” negatively and indirectly, as the a posteriori aspect(s) of activity A.  In defining “result” exclusively in terms of the a posteriori, we guarantee that the science studying the relationship between actions and their results will be an a posteriori (empirical) one.

Key

EP = Epistemological Problems of Economics, Mises, 1976
EPV = The Economic Point of View, Kirzner, 1976
ESA = Economic Science and the Austrian Method, Hoppe, 1995
FM = The Free Market and its Enemies, Mises, 2004
HA = Human Action, Mises, 1966
HUL = “Economic Science and Neoclassicism,” Hulsmann, The Quarterly Journal of Austrian Economics, Winter 1999.
I = Investigations Into the Method of the Social Sciences, Menger, 1985
IEO = Individualism and Economic Order, Hayek, 1948
LR = An Essay on the Nature & Significance of Economic Science, Robbins, 1945
MBS = Minds, Brains and Science, Searle, 2003
MES = Man, Economy, and State, Rothbard, 1993
MM = Money, Method, and the Market Process, Mises, 1990
MOP = A Man of Principle, Essays in Honor of Hans F. Sennholz, 1992
POAE = “The Philosophical Origins of Austrian Economics,” Gordon, 1996
PP = Physics and Philosophy, Heisenberg, 1958
PPS = The Philosophy of Physical Science, Eddington, 1978
PSW = The Phenomenology of the Social World, Schutz, 1967
TH = Theory and History, Mises, 1985
UF = The Ultimate Foundation of Economic Science, Mises, 2002

November 1, 2013 / Adam Knott

Free eBooks

Three of my books are currently available in eBook format and may be downloaded for free from the following retailers and distributors:

Amazon.com    (search “adam knott”)

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For Apple users, my free eBooks may be found by searching for “adam knott” in the iBook store.

The three books currently available are:  Praxeology and the Rothbardians (2012),  A Preliminary Critique of Hans-Hermann Hoppe’s Argumentation Ethics (2007, revised 2013), and Hayek and Praxeology (2013).

October 31, 2013 / Adam Knott

Hayek and Praxeology

Hayek and Praxeology

 

One of the most important factors that inhibited the study of praxeology for the last sixty years was Hayek’s argument that praxeology is inapplicable to the study of market phenomena.  Hayek’s argument against praxeology (which he called the “Pure Logic of Choice”) is relatively simple.  The Pure Logic of Choice, as Hayek understood it, entails an analytical relationship between 1) the object of an actor’s action, and 2) the actor’s action.  Here is the key passage from Hayek’s essay “The Facts of the Social Sciences.”

From the fact that whenever we interpret human action as in any sense purposive or meaningful, whether we do so in ordinary life or for the purposes of the social sciences, we have to define both the objects of human activity and the different kinds of actions themselves, not in physical terms but in terms of the opinions or intentions of the acting persons, there follow some very important consequences; namely, nothing less than that we can, from the concepts of the objects, analytically conclude something about what the actions will be.  If we define an object in terms of a person’s attitude toward it, it follows, of course, that the definition of the object implies a statement about the attitude of the person toward the thing.  When we say that a person possesses food or money, or that he utters a word, we imply that he knows that the first can be eaten, that the second can be used to buy something with, and that the third can be understood—and perhaps many other things.

Hayek’s conception of praxeology or the Pure Logic of Choice is a kind of conceptual analysis.  If we say the object confronting the actor is food, we can analytically conclude that the action associated with that object will be eating.  If the object confronting the actor is money, we can analytically conclude that the action associated with that object will be buying or selling, etc.   Thus, Hayek conceives an analytic or logically necessary relationship between 1) the object that we, as social scientists, assume confronts an actor, and 2) the action the actor will perform based on the assumption of the object that confronts that actor.  The analytic relationship Hayek conceives is between an object appearing to an observed or studied actor, and the action that must, by conceptual analysis, “accompany” that object.

Hayek then makes the following point.  The market is comprised of the interactions of a number of people.  When we study the market, we study the relationship between of a number of people, not an individual actor and the relationship between his action and the object of his action.

Here are the relevant passages from Hayek’s essay “Economics and Knowledge.”

I have long felt that the concept of equilibrium itself and the methods which we employ in pure analysis have a clear meaning only when confined to the analysis of the action of a single person and that we are really passing into a different sphere and silently introducing a new element of altogether different character when we apply it to the explanation of the interactions of a number of different individuals.

…the sense in which we use the concept of equilibrium to describe the interdependence of the different actions of one person does not immediately admit of application to the relations between actions of different people.

To get a clear idea of Hayek’s point, let us consider ourselves social scientists looking at a local marketplace from the top of a nearby building.  We see many people in the marketplace interacting and doing various things: buying, selling, talking, eating, etc.  To each of these individual actors then, we may apply the analytic principle of Hayek’s Pure Logic of Choice.  If one actor has food, the action analytically associated with this is eating; if one actor has money, the action analytically associated with this is buying, etc.

But this method of analysis does not apply to the relationship between actors.  If one actor has food, this doesn’t say anything necessary about the action of a second, different actor.

Thus, the Pure Logic of Choice (praxeology) does not apply to study of the market.

This argument of Hayek’s constitutes the fundamental difference between the Misesian and the Hayekian conception of economics.   The fundamental proposition of Hayekian economics is that market study can only be empirical, not a priori.  In other words, praxeology is inapplicable to market study:

What I see only now clearly is the problem of my relationship to Mises, which began with my 1937 article on the economics of knowledge, which was an attempt to persuade Mises himself that when he asserted that the market theory was a priori, he was wrong; that what was a priori was only the logic of individual action, but the moment that you passed from this to the interaction of many people, you entered into the empirical field. (Hayek on Hayek, p. 72)

******

As Hayek’s argument against praxeology is relatively simple, so is it simple to see the flaw in Hayek’s argument.   We may ask, when a marketplace is the object of the actor’s action (when the actor observes a market, or when he walks in a market, or when he buys in a market), why can’t we draw an analytical conclusion from this object of the actor’s action?   Or, when a price is the object of the actor’s action (when the actor observes a price, or asks a price, or pays a price), why can’t we draw an analytical conclusion from this object of the actor’s action?   In short, why can’t we arrive at analytical conclusions regarding any social object or social phenomenon or any market object or market phenomenon, by understanding them to be objects of an actor’s action, and drawing analytical conclusions from these objects as Hayek indicates?

If we assume an actor possess food, and from this we may analytically arrive at the action eating, then when the actor visits a market, why may we not analytically arrive at the action purchasing?   And when the actor considers a price, why may we not analytically arrive at the action exchanging?

It would seem that Hayek’s analytical method should be applicable to the objects or phenomenon of the market, and this would constitute a kind of “a priori” analysis of the market.

Furthermore, this same procedure should be applicable to other social objects and social phenomena such as language(s), law(s), the family, etc.

*******

One other important aspect of Hayek’s critique should be noted.  Recall that when Hayek describes the procedure of the Pure Logic of Choice, he does so in terms of a third person narrative.  Hayek writes:

When we say that a person possesses food or money, or that he utters a word, we imply that he knows that the first can be eaten, that the second can be used to buy something with, and that the third can be understood—and perhaps many other things. (emphasis added)

Hayek here refers to a hypothetical actor whom the scientist observes or studies.  The question is, what about the case when it is the social scientist himself who interacts with the object or phenomenon in question?   Let’s say that the social scientist visits a farmer’s market or pays a price for something in this same market, or pays interest on a loan.  Since the market, the price, the loan, and the interest, appear to the scientist as objects of his own action, what prevents the scientist from drawing analytical conclusions about action from these objects which appear to him?   Is there something that obligates the social scientist to study only the relationship between the objects and actions of other people?   What prevents the scientist from studying the relationship between his own actions and the objects of his actions?

Thus, there are two problems with Hayek’s critique of praxeology:

1.  Hayek doesn’t explain why the Pure Logic of Choice can’t be applied to study of the market by considering market phenomena as objects of action (visiting a market, paying a price, etc.) and then drawing analytical conclusions from the concepts of those objects.

2.  Hayek doesn’t explain why the social scientist can’t apply the Pure Logic of Choice to the objects of his own actions, and draw analytical conclusions about the relationship between his own actions and the objects of his actions.

********

The aforementioned problems are problems in the application and understanding of Hayek’s own conception of praxeology.  Above, we assume that Hayek’s conception of praxeology is valid (and is the same as Mises’s), and we simply ask “if praxeology applies to objects a, b, and c, why doesn’t praxeology apply to objects x, y, and z?”  And we ask “if praxeology applies to the objects of A’s action, why doesn’t praxeology apply to the objects of B’s action?”   Hayek agrees that it is possible to draw analytical conclusions from objects a, b, and c, by considering them objects of the action of actor A.  We simply ask why we can’t draw analytical conclusions from objects x, y, and z, by considering them objects of the action of actor B?   We’re asking why Hayek’s principles don’t apply to objects and persons besides the specific ones Hayek uses to illustrate his principles.

*******

It should be noted though, that Hayek’s conception of the Pure Logic of Choice is not identical to Mises’s conception of praxeology.  Hayek’s Pure Logic of Choice is a kind of conceptual analysis.   Misesian praxeology is not concerned with conceptual analysis per se; it is concerned with the formal structure of action.  These two things are not the same.  As Mises conceives:

Praxeology is not concerned with the changing content of acting, but with its pure form and categorial structure. (Human Action, 3rd rev. p. 47)

Thus, as soon as we differentiate the object of action “food” from the object of action “money,” (as Hayek does in the Pure Logic of Choice) we are, according to Mises, referring to the changing content of action, and have therefore left praxeology proper.

This shows that Hayek conceives praxeology differently from Mises.

********

Aside from the questions about the application of Hayek’s Pure Logic of Choice, there are serious questions about the knowledge it could possibly impart.

Recall, for example, that Hayek claims:

…we can, from the concepts of the objects, analytically conclude something about what the actions will be…

Is this simple proposition necessarily true?   Can we analytically conclude the action of the individual based on the concept of the object that confronts him?

If we say that an actor possesses food, does this mean that the actor will perform the action of eating?  Can’t an actor possess food but not eat the food?   Let’s say an actor possesses a ball.  Must he throw the ball?   If an actor possesses a ball, may we “analytically conclude something about what his actions will be”?   The answer seems clearly to be no.  Perhaps we can analytically conclude that if an actor possesses a ball, then he also possesses a sphere and an object having an internal volume.  Here we have conceptual or tautological analysis, but we have not thereby established a necessary relationship between a particular object and a particular action that an actor possessing that object must perform.  The study of concepts is not identical to the study of action.

*******

One of the fundamental pillars of Hayekian social thought is Hayek’s contention that study of the market cannot be a priori.   But Hayek seems not to have realized the implications of his own conception of the Pure Logic of Choice.  He didn’t realize that the method of logical analysis he envisioned could easily be applied to the market and its various objects and phenomena (prices, interest, etc.).

In conceiving that formal exact science is inapplicable to the study of market phenomena, Hayek’s thinking diverges not only from Mises’s, but from Menger’s as well.  Menger’s Investigations into the Method of the Social Sciences is largely devoted to the proposition that formal exact science is valid in all realms of the world of phenomena, “economy” being but one realm of human phenomena.  Thus, Mises’s insight that economics is only one branch of praxeology can be traced back to Menger’s vision of the “exact approach to cognition.”  In his Investigations, Menger provided a definition of formal exact science, a science which Mises later termed praxeology.

The aim of this orientation, which in the future we will call the exact one, an aim which research pursues in the same way in all realms of the world of phenomena, is the determination of strict laws of phenomena, of regularities in the succession of phenomena which do not present themselves to us as absolute, but which in respect to the approaches to cognition by which we attain to them simply bear within themselves the guarantee of absoluteness.  It is the determination of laws of phenomena which commonly are called “laws of nature,” but more correctly should be designated by the expression “exact laws.”

 

 

October 20, 2013 / Adam Knott

The Structural Difference between Social Science and Natural Science – Part 2a: The Epistemological Approach to Knowledge

Physical science studies the objective or physical world; praxeology studies the subjective world or the world of consciousness.  Understanding praxeology requires a deeper understanding of the difference between these two realms of study.  As a guide to understanding the nature of physical science we will use Arthur Eddington’s The Philosophy of Physical Science, and we will contrast Eddington’s account of physical science with the fundamentally different approach taken by praxeology.  Eddington’s book is important for the reason that, while his subject is physical science, he advocates the same epistemological method or epistemological approach that is the foundation of Mises’s social science.  Because Eddington goes into some detail about the relationship between the epistemological approach and physical knowledge, this allows us to form a clear and distinct conception of the relationship between the epistemological approach and social or praxeological knowledge.

Eddington’s primary contention is that the laws of physics are entirely subjective in nature.

All the laws of nature that are usually classed as fundamental can be foreseen wholly from epistemological considerations.  They correspond to a priori knowledge, and are therefore wholly subjective…the system of fundamental laws is wholly subjective. (p. 57)

All [the] progress [of physics] relates to subjective law.  It all relates to uniformities imposed on the results of observation by the procedure of observation. (p. 62)

The subjectivity referred to in these lectures is that which arises from the sensory and intellectual equipment of the observer. (p. 85)

What Eddington refers to as the epistemological approach goes hand-in-hand with the study of laws of subjectivity.

We may distinguish knowledge of the physical universe derived by study of the results of observation as a posteriori knowledge, and knowledge derived by epistemological study of the procedure of observation as a priori knowledge. (p. 24)

The epistemologist is an observer only in the sense that he observes what is in the mind. (p. 23)

…the epistemological approach takes knowledge as the starting point rather than an existent entity of which we have somehow to obtain knowledge. (p. 3)

The traditional method of systematic examination of the data furnished by observation is not the only way of reaching the generalizations valued in physical science.  Some at least of these generalisations can also be found by examining the sensory and intellectual equipment used in observation. (p. 18)

Generalisations that can be reached epistemologically have a security which is denied to those that can only be reached empirically. (p. 19)

The situation is changed when we recognize that some laws of nature may have an epistemological origin.  These are compulsory; and when their epistemological origin is established, we have a right to our expectation that they will be obeyed invariably and universally.  The process of observing, of which they are a consequence, is independent of time or place. (p. 20)

If we compare Eddington’s conception of the epistemological approach to Mises’s description of the foundation of praxeology, we will find a remarkable similarity of vision:

Human knowledge is conditioned by the structure of the human mind.  If it chooses human action as the subject matter of its inquiries, it cannot mean anything else than the categories of action which are proper to the human mind and are its projection into the external world of becoming and change.  All the theorems of praxeology refer only to these categories of action and are valid only in the orbit of their operation. (HA, p. 36)

[The problem of the a priori] refers to the essential and necessary character of the logical structure of the human mind. (HA, p. 34)

For man every cognition is conditioned by the logical structure of his mind and implied in this structure. (HA, p. 86)

For, as must be emphasized again, the reality the elucidation and interpretation of which is the task of praxeology is congeneric with the logical structure of the human mind. (UF, p. 65)

The a priori sciences—logic, mathematics, and praxeology—aim at a knowledge unconditionally valid for all beings endowed with the logical structure of the human mind. (HA, p. 57)

Writing in the early 1940’s, Hayek described the epistemological approach in this way:

If we consider for a moment the simplest kinds of actions where this problem arises, it becomes, of course, rapidly obvious that, in discussing what we regard as other people’s conscious actions, we invariably interpret their action on the analogy of our own mind: that is, that we group their actions, and the objects of their actions, into classes or categories which we know solely from the knowledge of our own mind. (IEO, p. 63)

We thus always supplement what we actually see of another person’s action by projecting into that person a system of classification of objects which we know, not from observing other people, but because it is in terms of these classes that we think ourselves. (IEO, p. 63)

The claim to which I have referred follows directly from this character of the first part of our task as a branch of applied logic.  But it sounds startling enough at first.  It is that we can derive from the knowledge of our own mind in an “a priori” or “deductive” or “analytic” fashion, an (at least in principle) exhaustive classification of all the possible forms of intelligible behavior. (IEO, p. 67)

…when we reflect that, whenever we discuss intelligible behavior, we discuss actions which we can interpret in terms of our own mind, the claim loses its startling character and in fact becomes no more than a truism.  If we can understand only what is similar to our own mind, it necessarily follows that we must be able to find all that we can understand in our own mind. (IEO, p. 68)

Let us pause for a moment and reflect on this procedure which Eddington refers to as the epistemological approach.  The idea is relatively simple: in the epistemological approach, we operate on the assumption that the regularity or uniformity of phenomena is a function of our consciousness, not a function of the external or physical world.  For example, let’s take the law(s) of conservation.  Our cognition and experience concerning the operant laws of conservation may be interpreted in at least two ways.  We may conceive that conservation “exists” in the objective, physical world, independent of any consciousness.  Or, we may conceive that we experience the phenomenon of conservation due to the structure of our mind; i.e., when something (X) “happens,” we believe we will always find some counter-balancing counterpart (Y) because our mind is structured such that “happenings” always come with “counterparts”.  As we’ve seen, Mises is pursuing this second approach.

The human action which is inextricably linked with human thought is conditioned by logical necessity.  It is impossible for the human mind to conceive logical relations at variance with the logical structure of our mind.  It is impossible for the human mind to conceive a mode of action whose categories would differ from the categories which determine our own actions. (HA, p. 25)

The scope of praxeology is the explication of the category of human action. All that is needed for the deduction of all praxeological theorems is knowledge of the essence of human action. It is a knowledge that is our own because we are men; no being of human descent that pathological conditions have not reduced to a merely vegetative existence lacks it. No special experience is needed in order to comprehend these theorems, and no experience, however rich, could disclose them to a being who did not know a priori what human action is. The only way to a cognition of these theorems is logical analysis of our inherent knowledge of the category of action. We must bethink ourselves and reflect upon the structure of human action. Like logic and mathematics, praxeological knowledge is in us; it does not come from without. (HA, p. 64)

Mises’s insight was that the regularities we intuit or experience in social phenomena are experienced as regularities due to the logical structure of the human mind by which we apprehend them. The regularities that we intuit in social phenomena, and which praxeology attempts to formulate in terms of exact laws, are experienced as regularities because our mind organizes experience in terms of mental “categories,” foremost among them the categories of ends (purposes) and means (things utilized toward purposes).  Scientific laws can thus be interpreted as regularities of consciousness which exhibit the structure of our consciousness.  Our task as praxeologists is to study this structure with ever more care and precision as a means to understanding the regularities in the world around us, both social and physical.

Key

EP = Epistemological Problems of Economics, Mises, 1976
EPV = The Economic Point of View, Kirzner, 1976
ESA = Economic Science and the Austrian Method, Hoppe, 1995
FM = The Free Market and its Enemies, Mises, 2004
HA = Human Action, Mises, 1966
HUL = “Economic Science and Neoclassicism,” Hulsmann, The Quarterly Journal of Austrian Economics, Winter 1999.
I = Investigations Into the Method of the Social Sciences, Menger, 1985
IEO = Individualism and Economic Order, Hayek, 1948
LR = An Essay on the Nature & Significance of Economic Science, Robbins, 1945
MBS = Minds, Brains and Science, Searle, 2003
MES = Man, Economy, and State, Rothbard, 1993
MM = Money, Method, and the Market Process, Mises, 1990
MOP = A Man of Principle, Essays in Honor of Hans F. Sennholz, 1992
POAE = “The Philosophical Origins of Austrian Economics,” Gordon, 1996
PP = Physics and Philosophy, Heisenberg, 1958
PSW = The Phenomenology of the Social World, Schutz, 1967
TH = Theory and History, Mises, 1985
UF = The Ultimate Foundation of Economic Science, Mises, 2002

July 16, 2013 / Adam Knott

The Structural Difference between Social Science and Natural Science – Part 1

The Structural Difference between Social Science and Natural Science

Natural science is the study of objects or states that may be observationally compared.  In natural science we compare X and Y with respect to their respective attributes.  Social science, by contrast, is not founded on an observational comparison of several objects or states.  In social science we do not compare the attributes of two things X and Y.  The foundation of social science is the relationship between an object or state (X) on the one hand, and a desire to change X to something different on the other hand.  Here, there is only one entity, X, that has attributes.  The focal point of social science is the relationship between X and a desire to change X to something different.

We may call the desire to change X to something different an entity, Y.  Social science then is founded on the relationship between object or state X, and the desire (Y) to change X.  We assume as given an observation, perception, or sensation, X.   If we assume or postulate that Y—the desire to change X—is also an observation, perception, or sensation (e.g., the notion that desire is something I can feel, or the notion that desire is something that can be observed as a chemical or biological process), then a study of the relationship between X and Y is a study of two objects or states that may be observationally, perceptually, or sensually compared.  Such a comparison constitutes the foundation of natural science.

On the other hand, if we assume or postulate that Y—the desire to change X—is not an observation, perception, or sensation (i.e., if we assume or postulate that Y is a nonperceptible presence), then a study of the relationship between X and Y cannot be a study of two objects that may be observationally, perceptually, or sensually compared.  Such a study then cannot be natural science, but must be a different kind of study.  This illustrates the epistemological or structural difference between natural science and social science.

If we assume as given perception X, and if we assume the desire (Y) to change X is a nonperceptual presence, then the concept pair object/desire conforms to the binary categorial structure previously explained.  Regarding the previously discussed concept pairs: supply/demand, supply/value, means/ends, satisfaction/dissatisfaction, etc., the entities that comprise one category must be fundamentally different from the entities that comprise the other category.  Only the elements of one category may have observable or perceptible attributes (may be defined in terms of sensations, perceptions, or observations).  In social science, the desire to change X must be of an altogether different nature from X; the valuing of supply X must be of an altogether different nature from supply X; the end toward which means X is utilized, must be of an altogether different nature from means X, etc.

Natural science requires a plurality of observations.  Its categorial structure includes, minimally, an initial observation (observation-1) and a follow-up observation (observation-2).  The categorial structure of social science entails only one category of observation (only one category of perceptual or sensual data).  Social science lacks the categorial structure needed for comparing a plurality of observational, perceptual, or sensual data.

Physical Concepts in Social Science

It follows directly from the epistemological difference between social science and physical science that social science cannot employ conceptions that imply (that rely on or require) a comparison of several observations, perceptions, or sensations.  For example, the notion “more urgent versus less urgent” implies that two instances of urgency have been compared with respect to their intensity.  The idea is that two observations, perceptions, or sensations, have occurred and have been compared, and it has been determined that in observation-1 “more” of an attribute was found than was found in observation-2.  As has been argued, this comparison of several observations, perceptions, or sensations, constitutes the very foundation of natural science.  An investigation founded on observational comparisons is a natural-scientific investigation, not a social-scientific one.  Hayek wrote about the nonphysical nature of social phenomena in his essay “The Facts of the Social Sciences”:

…though all the social phenomena with which we can possibly deal may have physical attributes, they need not be physical facts for our purpose.  That depends on how we shall find it convenient to classify them for the discussion of our problems.  Are the human actions which we observe, and the objects of these actions, things of the same or a different kind because they appear as physically the same or different to us, the observers—or for some other reason?

Is it the physical attributes of the objects—what we can find out about these objects by studying them—or is it by something else that we must classify the objects when we attempt to explain what men do about them?

It is easily seen that all these [social science] concepts…refer not to some objective properties possessed by the things, or which the observer can find out about them, but to views which some other person holds about the things.  These objects cannot even be defined in physical terms, because there is no single physical property which any one member of a class must possess.

What I am arguing is that no physical properties can enter into the explicit definition of any of these classes, because the elements of these classes need not possess common physical attributes, and we do not even consciously or explicitly know which are the various physical properties of which an object would have to possess at least one to be a member of a class.

The common attributes which the elements of any of these classes possess are not physical attributes but must be something else. (IEO, p. 59-62)

Social phenomena cannot be defined in physical terms.  This means that social phenomena cannot be defined in terms of a comparison of the attributes of several observations, perceptions, or sensations.  And this means that social phenomena cannot be defined in terms of distinctions such as internal/external, sooner/later, higher/lower, more/less, etc.  Physical terms such as these imply attribute differences between several entities.  The study of attribute differences between several entities constitutes the foundation of natural science.  In his essay, Hayek came to the following conclusion:

…whenever we interpret human action as in any sense purposive or meaningful, whether we do so in ordinary life or for the purposes of the social sciences, we have to define both the objects of human activity and the different kinds of actions themselves, not in physical terms but in terms of the opinions or intentions of the acting persons…

Hayek writes that we have to define the objects and actions of social science (in Hayek’s conception these are two observable entities) in terms of the opinions or intentions of the acting persons.  Here, following Hulsmann, we will consider opinions and intentions to be “nonextended entities” similar in nature to value, utility, preference ranks, etc.  Thus, we interpret Hayek’s insight as consistent with what we assert regarding the difference between natural science and social science.  Social science does not treat the relationship between two observable (extended) entities.  Social science treats the relationship between an observable entity on the one hand (Hayek’s objects and actions), and a nonobservable (nonextended) entity on the other hand (Hayek’s opinions and intentions).  The relevant concept pair in this case is object/opinion or object/intention, where one category is a category of perceptual content, and the other category is a category of nonperceptual presence.

Key

EP = Epistemological Problems of Economics, Mises, 1976
EPV = The Economic Point of View, Kirzner, 1976
ESA = Economic Science and the Austrian Method, Hoppe, 1995
FM = The Free Market and its Enemies, Mises, 2004
HA = Human Action, Mises, 1966
HUL = “Economic Science and Neoclassicism,” Hulsmann, The Quarterly Journal of Austrian Economics, Winter 1999.
I = Investigations Into the Method of the Social Sciences, Menger, 1985
IEO = Individualism and Economic Order, Hayek, 1948
LR = An Essay on the Nature & Significance of Economic Science, Robbins, 1945
MBS = Minds, Brains and Science, Searle, 2003
MES = Man, Economy, and State, Rothbard, 1993
MM = Money, Method, and the Market Process, Mises, 1990
MOP = A Man of Principle, Essays in Honor of Hans F. Sennholz, 1992
POAE = “The Philosophical Origins of Austrian Economics,” Gordon, 1996
PP = Physics and Philosophy, Heisenberg, 1958
PSW = The Phenomenology of the Social World, Schutz, 1967
TH = Theory and History, Mises, 1985
UF = The Ultimate Foundation of Economic Science, Mises, 2002

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