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June 19, 2013 / Adam Knott

The Dawning of a Realization

Daniel Hieber wrote an interesting article recently entitled “Language as Action.”  In his article, Hieber argues “that language is a type of action like any other, and therefore subject to the laws of praxeology.”  Imagine that!  Language is a type of action?  How can that be?

According to Hieber, the praxeological study of language as a type of action has been ignored by Austrians.  He writes: “as an area of praxeology language has garnered almost no recognition among Austrians.”  What Hieber suggests seems perfectly reasonable; treat language (speaking, writing, signalling, etc.) as an action and study it as a branch of praxeology.  But why hasn’t this been suggested before?  In general, what has prevented Austrian scholars since Mises from studying other forms of action besides “catallactic” actions (actions based on monetary calculation).

Konrad Graf began asking this question recently too.  In an article entitled “Misesian action theory is an approach to social theory, not just economics” Graf writes: “What if praxeology (deductive action theory in the tradition of Ludwig von Mises) is conceived as something much larger than merely the backstop for Austrian economics or a sort of pre-Austrian-economics warm-up act? In that case, economics ought to be better defined as one branch of praxeology among others. Since Mises kept mentioning economics as the “thus-far best-elaborated part” of praxeology, shouldn’t more thinkers be taking this up and working on advancing other such parts?”

Thus, more and more people are beginning to realize that something important has been overlooked when it comes to praxeology as the formal analysis of human action.  Almost all the scholarship undertaken by those who advocate praxeology as a discipline are economists interested primarily in market phenomena.  Why haven’t other forms of human action–such as language or even thinking–been studied by Austrians as a branch of praxeology?  Actually, Graf had already provided an important part of the answer in his 2011 paper “Action-Based Jurisprudence.”  In it, Graf wrote:

“However, such accounts of “praxeology and economics” leave little space for a sphere of content for praxeology to call its own, independent of economics. Rothbard writes that, “With praxeology as the general, formal theory of human action, economics includes the analysis of the action of an isolated individual (Crusoe economics)…” While the proposed distinction appears to be between “general and formal” and greater specificity, this sentence could generate confusion because “Crusoe economics” is a fictional device to explain the most fundamental concepts of praxeology itself—from ends and means to production to time-preference. Rothbard’s comment comes at the end of the chapter called “Fundamentals of Human Action,” which uses Crusoe to explain the most fundamental praxeological concepts. This could leave the impression that “economics,” as represented by “Crusoe economics,” has on day one moved in to occupy all of the identifiable territory in this new land of praxeology, taking as its own any and all content that might otherwise be assigned to a core of praxeology itself—an independent core that could be shared with other possible “branches” or “sub-divisions” besides economics.”

Here, Graf refers to what I have called the Rothbardian scholarship paradigm.  When Graf writes “such accounts of praxeology and economics” he refers to Rothbard’s view in which praxeology is considered somewhat synonymous with economics which in turn is considered synonymous with the study of market phenomena.  In other words, as Rothbard saw things, praxeology was the formal or axiomatic study of the market-related aspect of human affairs.  Not only was this reflected in his major works (Man, Economy & State treats market phenomena and advocates praxeology–The Ethics of Liberty treats interpersonal acts of violence and disavows praxeology), Rothbard wrote explicitly that:

“Value in the sense of valuation or utility is purely subjective, and decided by each individual. This procedure is perfectly proper for the formal science of praxeology, or economic theory, but not necessarily elsewhere.” (The Ethics of Liberty)(emphasis added)

Here we can clearly see the Rothbardian taxonomy–not the one he wrote in a chart, but the one he actually practiced.  The concepts of subjective value and utility are fine for praxeology or economic theory (considered largely synonymous), but they are not necessarily applicable to other areas of human conduct.  What are some of the other areas of human conduct?  According to Rothbard, in The Ethics of Liberty he deals with “the proper sphere of politics, i.e., with violence and non-violence used as modes of interpersonal relations.” So The Ethics of Liberty is a book about acts of violence that people direct toward one another in order to achieve their various ends. When Rothbard writes that the concepts of subjective value and utility are valid for economics and praxeology but not necessarily elsewhere, he is saying that the analytical framework of praxeology is not a valid method for studying the sphere of politics or for studying acts of violence used as modes of interpersonal relations.  I.e., praxeology is a valid approach for market study but not for the study of politics or direct personal interaction.  For the study of politics and direct personal interaction Rothbard advocated the normative disciplines (natural law, objective ethics, argumentation ethics, etc.).   In advocating (implicitly or explicitly) this taxonomy of the social disciplines, Rothbard was arguing against the one advocated by Mises.

“For more than a hundred years, however, the effects of this radical change in the methods of reasoning were greatly restricted because people believed that they referred only to a narrow segment of the total field of human action, namely, to market phenomena.… Until the late nineteenth century political economy remained a science of the “economic” aspects of human action, a theory of wealth and selfishness. It dealt with human action only to the extent that it was actuated by what was—very unsatisfactorily—described as the profit motive, and it asserted that there is in addition other human action whose treatment is the task of other disciplines.”  (Human Action, 3rd. rev. ed., pp. 2–3; emphasis added)

Thus, in his belief that other forms of action aside from market-related actions were to be studied by the normative, nonpraxeological disciplines, Rothbard clung to a scholarship paradigm that Mises considered outdated by over a century.  This didn’t go unnoticed by Austrian scholars such as Peter Boettke and Larry Sechrest.  Boettke wrote in 1988:

“Rothbard has intensely defended what he considers the basic tenets of Misesian economics: apriorism, deductivism, and individualism. These tenets represent to Rothbard “the method of economics”: praxeology. There is no doubt that Mises advocated a transcendental apriorism to ground the action axiom, just as there is no doubt that Mises thought deductive logic was indispensable for clear thought, and that economic explanations must be traceable back to the meaningful acts of individuals. But, upon deeper examination, Rothbard’s apparent authority is highly questionable. Mises’s thought is much more subtle than is typical of Rothbard. First of all, praxeology is a discipline, not a method. Rothbard totally obscures this point throughout his methodological writings. To Mises, praxeology is the broader discipline of the human sciences, of which economics represents a mere subset,…” (emphasis added)

and Sechrest wrote:

“Thus praxeology is the broader category. Economics is one of the subsets of praxeological inquiry. “[T]he praxeological view sees the economic affairs as distinguished solely by the fact that they belong to the larger body of phenomena that have their source in human actions” (Kirzner 1976, p. 148). Yet many Austrians slip into the habit of equating praxeology with economic theory alone. This is understandable as long as Austrians think of economics as the science of human action. However, to do so is an error, since it is praxeology which is the science of human action, not economics. In other words, it would be preferable to define economics in a narrower fashion, one that does not merely equate it with praxeology.”

Thus, it was known that Rothbard was involved in changing the Austrian theoretical paradigm away from the one proposed by Mises, and toward one which suited his own purposes.  Rothbard conceived praxeology merely as “the method of Austrian economics” while Mises conceived praxeology as a general science that studies all human conscious conduct formally and deductively.  And this explains in large part why forms of action not directly related to market activity have been largely ignored by Austrians.  It was Rothbard’s influence that turned most people away from Mises’s praxeological vision.

It has only recently begun to dawn on some in the Austrian community that something isn’t right.  If praxeology is the science of human action, and if economics is only one branch of this science, where is the body of Austrian theory examining the other realms or areas or varieties of human action?   It is a welcome change to see writers such as Hieber and Graf asking this question.

Hieber’s website is here: http://danielhieber.com/

Graf’s website is here: http://konradsgraf.com/

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