The Ultimate Foundation of Economic Science. Людвиг фон Мизес

THE ULTIMATE FOUNDATION OF ECONOMIC SCIENCE

       An Essay on Method

Some Preliminary Observations Concerning Praxeology Instead of an Introduction

1 The Permanent Substratum of Epistemology

      Πάντα ῥει̑, everything is in a ceaseless flux, says Heraclitus; there is no permanent being; all is change and becoming. It must be left to metaphysical speculation to deal with the problems whether this proposition can be borne out from the point of view of a superhuman intelligence and furthermore whether it is possible for a human mind to think of change without implying the concept of a substratum that, while it changes, remains in some regard and sense constant in the succession of its various states. For epistemology, the theory of human knowledge, there is certainly something that it cannot help considering as permanent, viz., the logical and praxeological structure of the human mind, on the one hand, and the power of the human senses, on the other hand. Fully aware of the fact that human nature as it is in this epoch of cosmic changes in which we are living is neither something that existed from the very beginning of all things nor something that will remain forever, epistemology must look upon it as if it were unchanging. The natural sciences may try to go further and to study the problems of evolution. But epistemology is a branch—or rather, the basis—of the sciences of man. It deals with one aspect of the nature of man as he emerged from the eons of cosmic becoming and as he is in this period of the history of the universe. It does not deal with thinking, perceiving and knowing in general, but with human thinking, perceiving and knowing. For epistemology there is something that it must take as unchanging, viz., the logical and praxeological structure of the human mind.

      One must not confuse knowledge with mysticism. The mystic may say that “shadow and sunlight are the same.”¹ Knowledge starts from the clear distinction between A and non-A.

      We know that there were ages of cosmic history in which there did not exist beings of the kind we call Homo sapiens, and we are free to assume that there will be again ages in which this species will not exist. But it is vain for us to speculate about the conditions of beings that are, in the logical and praxeological structure of their minds and in the power of their senses, essentially different from man as we know him and as we are ourselves. Nietzsche’s concept of a superman is devoid of any epistemological meaning.

2 On Action

      Epistemology deals with the mental phenomena of human life, with man as he thinks and acts. The main deficiency of traditional epistemological attempts is to be seen in their neglect of the praxeological aspects. The epistemologists dealt with thinking as if it were a separate field cut off from other manifestations of human endeavor. They dealt with the problems of logic and mathematics, but they failed to see the practical aspects of thinking. They ignored the praxeological a priori.

      The shortcomings of this approach became manifest in the teachings of natural theology as distinguished from revealed theology. Natural theology saw the characteristic mark of deity in freedom from the limitations of the human mind and the human will. Deity is omniscient and almighty. But in elaborating these ideas the philosophers failed to see that a concept of deity that implies an acting God, that is, a God behaving in the way man behaves in acting, is self-contradictory. Man acts because he is dissatisfied with the state of affairs as it prevails in the absence of his intervention. Man acts because he lacks the power to render conditions fully satisfactory and must resort to appropriate means in order to render them less unsatisfactory. But for an almighty supreme being there cannot be any dissatisfaction with the prevailing state of affairs. The Almighty does not act, because there is no state of affairs that he cannot render fully satisfactory without any action, i.e., without resorting to any means. For Him there is no such thing as a distinction between ends and means. It is anthropomorphism to ascribe action to God. Starting from the limitations of his human nature, man’s discursive reasoning can never circumscribe and define the essence of omnipotence.

      However, it must be emphasized that what prevented people from paying attention to the praxeological issues was not theological considerations. It was the passionate longing for the realization of the utopian chimera of the land of Cockaigne. As the science of economics, the up-to-now best elaborated part of praxeology, exploded the fallacies of every brand of utopianism, it was outlawed and stigmatized as unscientific.

      The most characteristic trait of modern epistemology is its entire neglect of economics, that branch of knowledge whose development and practical application was the most spectacular event of modern history.

3 On Economics

      The study of economics has been again and again led astray by the vain idea that economics must proceed according to the pattern of other sciences. The mischief done by such misconstructions cannot be avoided by admonishing the economist to stop casting longing glances upon other fields of knowledge or even to ignore them entirely. Ignorance, whatever subject it may concern, is in no case a quality that could be useful in the search for truth. What is needed to prevent a scholar from garbling economic studies by resorting to the methods of mathematics, physics, biology, history or jurisprudence is not slighting and neglecting these sciences, but, on the contrary, trying to comprehend and to master them. He who wants to achieve anything in praxeology must be conversant with mathematics, physics, biology, history, and jurisprudence, lest he confuse the tasks and the methods of the theory of human action with the tasks and the methods of any of these other branches of knowledge. What was wrong with the various Historical Schools of economics was first of all that their adepts were merely dilettantes in the field of history. No competent mathematician can fail to see through the fundamental fallacies of all varieties of what is called mathematical economics and especially of econometrics. No biologist was ever fooled by the rather amateurish organicism of such authors as Paul de Lilienfeld.

      When I once expressed this opinion in a lecture, a young man in the audience objected. “You are asking too much of an economist,” he observed; “nobody can force me to employ my time in studying all these sciences.” My answer was: “Nobody asks or forces you to become an economist.”

4 The Starting Point of Praxeological Thinking

      The a priori knowledge of praxeology is entirely different—categorially different—from the a priori knowledge of mathematics or, more precisely, from mathematical a priori knowledge as interpreted by logical positivism. The starting point of all praxeological thinking is not arbitrarily chosen axioms, but a self-evident proposition, fully, clearly and necessarily present in every human mind. An unbridgeable gulf separates those animals in whose minds this cognition is present from those in whose minds it is not fully and clearly present. Only to the former is the appellation man accorded. The characteristic feature of man is precisely that he consciously acts. Man is Homo agens, the acting animal.

      All—apart from zoology—that has ever been scientifically stated to distinguish man from nonhuman mammals is implied in the proposition: man acts. To act means: to strive after ends, that is, to choose a goal and to resort to means in order to attain the goal sought.

      The essence of logical positivism is to deny the cognitive value of a priori knowledge by pointing