Praxeology: My dissertation.

[Fool_on_the_Hill]

So it would not be unreasonable to say that we know this to be true a priori, right? And that this must logically apply to the voluntary action of trade as well?

Yes, that would be a priori. Once you apply it to the external world, however, you are no longer doing something a priori (or at least not purely a priori). I see what you are saying now more since starting Human Action. Mises actually says that all economics employs a priori reasoning. I had the mistaken impression that AE claimed to be exceptional in this regard.

What if the economic model were shown to contradict this principle?

I am not aware of any economic models that contradict this principle. Obviously, they would be invalid if they did.

[Fool_on_the_Hill]

I just jumped ahead and found that Mises makes the same error in his explanation of Autistic Exchange and Interpersonal Exchange. Autistic “Exchange” refers to the selection of possible states within a single period of time–if I go to the museum tomorrow I can’t go to the baseball game. While Interpersonal Exchange refers to the transfer of things between two periods of time–I have money now, but if I give it to the clerk for a pair of shoes, I won’t have it later. Interpersonal Exchange has nothing to do with the action axiom. Autistic “Exchange” does relate to the axiom. However, it has nothing to do with exchange as it is normally understood. It strikes me as incredibly odd to use the word exchange to describe this phenomena.

So in both the case of profit and the case of exchange, it is only the unorthodox definition that meets Mises’s action axiom. Hmm, can you blame me if I start getting a wee bit suspicious?

[FunkedUp]

@Fool on the Hill

Here Mises mentions a temporal component. Clearly this cannot be derived from his action axiom.

For Mises, only the indisputable axiom of action is a priori; he conceded the details to be broadly empirical.

@Fool on the Hill

Someone is not necessarily happier after they achieve an end than before they achieve it. That would mean, provided we always achieve our ends, that we get happier and happier as our life goes on.

I keep saying “ex ante” “ex ante” “ex ante”

Goal attainment is a continuous process in which full satisfaction in an absolute sense can never be reached (otherwise you wouldn’t act at all). Each action undertaken gives way to new states of knowledge, circumstances, etc. Maybe you reach your goal; maybe you don’t. Sometimes action brings about additional happiness and sometimes it doesn’t. The only part that matters here is that, prior to acting, you think that your action will result in increased satisfaction.

[FunkedUp]

@Clayton

…happiness necessarily entails some sort of material processes and that money is the most general means for bring about any particular material state of affairs.

Clayton -

This is not true. Happiness does not necessarily entail a materialistic process. I’m in agreement with your anti-materialists-don’t-get-it argument, but it’s not true for all circumstances.

For example…when I was using an elevator today I decided to hold the door open for someone. This action resulted in additional social capital for me (otherwise I wouldn’t have done it); it cost me nothing in a materialistic sense. Anyone that’s ever engaged in this behavior, or held a regular door open for someone, or picked up something for someone else when they dropped it, etc, is doing it for pure social capital gains. Profit/Happiness does not necessarilyhave to result from something materialistic (though most all of the time it does).

[Smiling_Dave]

For starters if anyone denies the truth factor of this axiom, then please write up a piece that shows how denying this self-evident axiom is not a performative contradiction.

Is the axiom that there exists at least one human actor, or is it more general, that everyone “acts” all the time?

If the former, the standard results of economics do not follow from such a weak axiom. If the latter, it it is not proven just because one guy has been shown to act by trying to disprove it.

[But in any case, I agree that it’s silly to deny such an obvious thing, and don’t think any proof is needed].

[mikachusetts]

I just jumped ahead and found that Mises makes the same error in his explanation of Autistic Exchange and Interpersonal Exchange. Autistic “Exchange” refers to the selection of possible states within a single period of time–if I go to the museum tomorrow I can’t go to the baseball game. While Interpersonal Exchange refers to the transfer of things between two periods of time–I have money now, but if I give it to the clerk for a pair of shoes, I won’t have it later. Interpersonal Exchange has nothing to do with the action axiom. Autistic “Exchange” does relate to the axiom. However, it has nothing to do with exchange as it is normally understood. It strikes me as incredibly odd to use the word exchange to describe this phenomena.

So in both the case of profit and the case of exchange, it is only the unorthodox definition that meets Mises’s action axiom. Hmm, can you blame me if I start getting a wee bit suspicious?

Both autistic and interpersonal exchange deal with a temporality – everything that Austrians say deals with temporality becuase time doesn’t stop. Also, temporality is assumed in the action axiom. If you are aiming at some end, time must necessarily be a factor because otherwise you could acheive the end instantaneously.

In autistic exchange, you are exchanging a current state of affairs for a future state. You might be choosing between the baseball game and the museum, but the exchange is between whatever you are currently doing and what you are about to do. Make sense?

[Fool_on_the_Hill]

I keep saying “ex ante” “ex ante” “ex ante”

Goal attainment is a continuous process in which full satisfaction in an absolute sense can never be reached (otherwise you wouldn’t act at all). Each action undertaken gives way to new states of knowledge, circumstances, etc. Maybe you reach your goal; maybe you don’t. Sometimes action brings about additional happiness and sometimes it doesn’t. The only part that matters here is that, prior to acting, you think that your action will result in increased satisfaction.

But I don’t even necessarily expect to gain increased satisfaction from attaining a goal vis-a-vis the state I’m in now. Imagine I am riding my bike from point 1 to point 2 to point 3 to point 4. I do not expect to be happier at point 3 than I was at point 2. Rather I expect to be happier than if stayed at point 2.

I’m waiting to see if Mises points this out, but means and ends are not mutually exclusive. In fact, I might go as far as to say that every means is also an end and every end is also a means. If the selection of every means can be criticized for its inability to achieve its desired end, then every end can also be criticized to the extent that it is a means for something else. For Aristotle, the good life was to live according to ones nature–that is, choosing ends that make us truly happy.

[mikachusetts]

Imagine I am riding my bike from point 1 to point 2 to point 3 to point 4. I do not expect to be happier at point 3 than I was at point 2. Rather I expect to be happier than if stayed at point 2.

Right, points 2 and 3 are constitutive means to your end, point 4. Just like every note in a piece of music is constitutive to your end of playing the whole piece. This is an important insight, but its ramifications are not as important in economics as they are in ethics.

I’m waiting to see if Mises points this out, but means and ends are not mutually exclusive.

He won’t, but thats because he is treating means and ends formally enough that they really are mutually exclusive. Insofar as an end can be a means to some further end, then it ceases to be an end.

For example, lets say I want to be a lawyer, thats my end. Along the way, there are a whole bunch of other ends I aim at like getting into law school, graduating, and passing the BAR. These things are ends so long as I am aiming to achieve them, but as I achieve those ends, they become means to a further end. An end can never be a means because it has yet to be had, and means aren’t means unless they are available.

Again, its all a matter of time and perspective.

[Fool_on_the_Hill]

Both autistic and interpersonal exchange deal with a temporality – everything that Austrians say deals with temporality becuase time doesn’t stop. Also, temporality is assumed in the action axiom. If you are aiming at some end, time must necessarily be a factor because otherwise you could acheive the end instantaneously.

In autistic exchange, you are exchanging a current state of affairs for a future state. You might be choosing between the baseball game and the museum, but the exchange is between whatever you are currently doing and what you are about to do. Make sense?

What I am currently doing is what gets me to what I will be doing in the future. So the idea that I can “exchange” what I am currently doing for a future state doesn’t make sense. It seems to imply that I could do what I am currently doing without arriving in that future state. I can’t choose to ride my bike at point 1 without arriving at point 2. If I stop riding my bike at point 1, then I wouldn’t be doing what I was doing. So either I am doing something different at point 1 or the same thing at point 2. Both of these constitute different states. Mises must refer to these states in an abstract way outside of time. Otherwise, his proposition would be invalid.

Certain ends must be achievable instantaneously or else we run into Zeno’s paradoxes.

[Fool_on_the_Hill]

He won’t, but thats because he is treating means and ends formally enough that they really are mutually exclusive. Insofar as an end can be a means to some further end, then it ceases to be an end.

For example, lets say I want to be a lawyer, thats my end. Along the way, there are a whole bunch of other ends I aim at like getting into law school, graduating, and passing the BAR. These things are ends so long as I am aiming to achieve them, but as I achieve those ends, they become means to a further end. An end can never be a means because it has yet to be had, and means aren’t means unless they are available.

But we have to be careful not to say something like, “you are happier when you become a lawyer than you were when you were in law school.” You do not “exchange” the state of being in law school for the state of being a lawyer. The very action of being in law school is what takes you out of law school. The state of being in law school and passing your exams is different from the state of intentionally flunking your exams so you can stay in law school for ever. There’s no way of looking at this state in a way that can be exchanged in the conventional sense. Our state of being is in constant flux, in the never ending process of becoming. We have a role in choosing what we become, but not that we become.

[mikachusetts]

What I am currently doing is what gets me to what I will be doing in the future. So the idea that I can “exchange” what I am currently doing for a future state doesn’t make sense. It seems to imply that I could do what I am currently doing without arriving in that future state.

I’m not sure I understand you. If I am sitting at my desk, and I want to be outside, I have to act for that state of affair to come about (putting aside the possibility of the roof blowing off or something). If i just continue to sit at my desk, I’m just not going to end up outside.

I can’t choose to ride my bike at point 1 without arriving at point 2. If I stop riding my bike at point 1, then I wouldn’t be doing what I was doing. So either I am doing something different at point 1 or the same thing at point 2. Both of these constitute different states. Mises must refer to these states in an abstract way outside of time. Otherwise, his proposition would be invalid.

What? If its impossible to arrive at point 1 without arriving at point 2, then point 2 is constitutive of point 1. So what? They may be different temporal states, but since they can never exist separately, it doesn’t make sense to talk about them as different ends. Someone might be confused and think that they could be separate, but that’s when you come along and show why they’re wrong.

Ends must be achievable instantaneously or else we run into Zeno’s paradoxes.

Yes, the moment that an end is achieved is instantaneous, but it does not occur instantly after the end is aimed at. It seems like you are purposefully assuming the least likely interpretation of everything I say.

EDIT:

But we have to be careful not to say something like, “you are happier when you become a lawyer than you were when you were in law school.” You do not “exchange” the state of being in law school for the state of being a lawyer. The very action of being in law school is what takes you out of law school. The state of being in law school and passing your exams is different from the state of intentionally flunking your exams so you can stay in law school for ever. There’s no way of looking at this state in a way that can be exchanged in the conventional sense. Our state of being is in constant flux, in the never ending process of becoming. We have a role in choosing what we become, but not that we become.

Right, but no one is saying that, and if they are, they don’t mean it the way you do. Mises uses happiness as a formal concept which means the satisfaction of wants (ends). Its not that you gain “hapiness,” its that you are satisfying more and more wants. And yeah, wants change.

[ClaytonB]

In colloquial speech we call a man “happy” who has succeeded in attaining his ends. A more adequate description of his state would be that he is happier than he was before. There is however no valid objection to a usage that defines human action as the striving for happiness.

Here Mises mentions a temporal component. Clearly this cannot be derived from his action axiom. Someone is not necessarily happier after they achieve an end than before they achieve it. That would mean, provided we always achieve our ends, that we get happier and happier as our life goes on. This is the exact reverse of what I described above: the form of monetary profit but with the object of psychic states. Either this is invalid reasoning or Mises is using a radical redefinition of happiness along with a completely different axiom.

Wow. Respect to your fair-mindedness, a rare virtue these days.

What you’re missing is that there is a pre-condition to action and that is want. Mises clearly makes this point early on while defining action. An individual who experiences no wants and who is in a perfect state of fulfillment will not act because he has no reason to act. It is only once want arises that the individual experiences some sort of uneasiness that impels him to act and relieve the felt uneasiness.

We call contentment or satisfaction that state of a human being which does not and cannot result in any action. Acting man is eager to substitute a more satisfactory state of affairs for a less satisfactory. His mind imagines conditions which suit him better, and his action aims at bringing about this desired state. The incentive that impels a man to act is always some uneasiness. A man perfectly content with the state of his affairs would have no incentive to change things. He would have neither wishes nor desires; he would be perfectly happy.

He would not act; he would simply live free from care. But to make a man act, uneasiness and the image of a more satisfactory state alone are not sufficient. A third condition is required: the expectation that purposeful behavior has the power to remove or at least to alleviate the felt uneasiness. In the absence of this condition no action is feasible. Man must yield to the inevitable. He must submit to destiny. These are the general conditions of human action. Man is the being that lives under these conditions. He is not only homo sapiens, but no less homo agens. Beings of human descent who either from birth or from acquired defects are unchangeably unfit for any action (in the strict sense of the term and not merely in the legal sense) are practically not human. Although the statutes and biology consider them to be men, they lack the essential feature of humanity. The newborn child too is not an acting being. It has not yet gone the whole way from conception to the full development of its human qualities. But at the end of this evolution it becomes an acting being.

HA ch. 1.2

The question “whence uneasiness?” is an empirical question about human nature and the nature of our environment and is entirely separate from the a priori analysis of action itself.

Clayton -

[ClaytonB]

For example…when I was using an elevator today I decided to hold the door open for someone. This action resulted in additional social capital for me (otherwise I wouldn’t have done it); it cost me nothing in a materialistic sense. Anyone that’s ever engaged in this behavior, or held a regular door open for someone, or picked up something for someone else when they dropped it, etc, is doing it for pure social capital gains. Profit/Happiness does not necessarilyhave to result from something materialistic (though most all of the time it does).

In order for your good intentions to have mattered, they must have made some material difference. In this case, you’re simply not shaving close enough to the skin - holding the door for a few seconds altered the material state of affairs that would have obtained otherwise. If you have more money, you are in a better position to afford the luxury of holding yourself up for someone else’s benefit (thus leading to your own satisfaction in exhibiting the virtue of minor charitableness).

Clayton -

[ClaytonB]

I just jumped ahead and found that Mises makes the same error in his explanation of Autistic Exchange and Interpersonal Exchange. Autistic “Exchange” refers to the selection of possible states within a single period of time–if I go to the museum tomorrow I can’t go to the baseball game. While Interpersonal Exchange refers to the transfer of things between two periods of time–I have money now, but if I give it to the clerk for a pair of shoes, I won’t have it later. Interpersonal Exchange has nothing to do with the action axiom. Autistic “Exchange” does relate to the axiom. However, it has nothing to do with exchange as it is normally understood. It strikes me as incredibly odd to use the word exchange to describe this phenomena.

So in both the case of profit and the case of exchange, it is only the unorthodox definition that meets Mises’s action axiom. Hmm, can you blame me if I start getting a wee bit suspicious?

Mises is clear in the section on Autistic Exchange that he is using the word “exchange” very loosely, as in, “exchanging one state of affairs for another.” The point of the discussion on autistic exchange is to make it clear that coercive situations cannot be recast as “voluntary exchange under an asymmetrical power relationship”. In other words, when the mugger sticks a gun in your ribs, you are not “choosing” between dying and giving him your wallet. He is acting autistically to take your wallet. He will have it no matter which “choice” you make. Conversely, actions that benefit others (for example, the genius street musician) without expectation of payment or reward are also a kind of autistic exchange.

Some of the mainstream types get confused on this point and want to treat coercive situations as non-equilibrium conditions of voluntary exchange. What they are missing is that voluntariness does not refer solely to the inalienable will but to the general conditions under which the exercise of that will can make a difference. Your wishes do not matter to the weather or the mugger, the actions of either are not a function of your choice.

Clayton -

[FunkedUp]

@Clayton

In order for your good intentions to have mattered, they must have made some material difference. In this case, you’re simply not shaving close enough to the skin - holding the door for a few seconds altered the material state of affairs that would have obtained otherwise. If you have more money, you are in a better position to afford the luxury of holding yourself up for someone else’s benefit (thus leading to your own satisfaction in exhibiting the virtue of minor charitableness).

Clayton -

Clayton, your response brings up a good point, but I am not quite satisfied with the argument that I hold the door open because I have money (though you are correct to state that by having money one is in a better position to afford such luxury). I think think the more appropriate term here is that I have the time; to which I would reply: is time money? I suppose most would respond with an sold “yes,” but I don’t think it’s true in all circumstances.

As far as I know there has been little to no research regarding this subject: social capital, non-profit organizations, time vs. money as it relates to opportunity cost, etc.

[ClaytonB]

Clayton, your response brings up a good point, but I am not quite satisfied with the argument that I hold the door open because I have money (though you are correct to state that by having money one is in a better position to afford such luxury). I think think the more appropriate term here is that I have the time; to which I would reply: is time money? I suppose most would respond with an sold “yes,” but I don’t think it’s true in all circumstances.

As far as I know there has been little to no research regarding this subject: social capital, non-profit organizations, time vs. money as it relates to opportunity cost, etc.

Well, I am not assigning a specific motive to your holding the door open. The proximate motive is apparently a desire to be charitable/make someone’s day and share in the good feelings that naturally come with that. Rather, my point is merely that you had to make some difference in the material state of affairs in order for your charitable intentions to have mattered and that money is the most general means of bringing about material states of affairs. Of course, there are other means including direct production of the material state of affairs.

In the case of holding the door open, we can at least say that - as far as you know - you bore the opportunity cost for the rest of your day that arose from voluntarily holding yourself up. Perhaps you hit that stoplight you otherwise wouldn’t have hit if you had been just 5 seconds earlier. That stoplight then held you up an additional 5 minutes which caused you to miss running into a prospective client that you may have met if you had been just 5 minutes earlier, etc. etc. The possible opportunities that you passed up (however miniscule) was the cost that you paid to directly produce a material state of affairs for the benefit of another. The more money you have, the larger such opportunity costs you may be willing to choose to bear. Philanthropy is the final extreme of this line of thought.

Clayton -

[myhumangetsme]

Profit has the same definition in Austrian economics - having more money than you started with…But action is not motivated by profit. Action is motivated by ends.

Maybe you mean something different from this than what I’m reading, but I’m having a very hard time reconciling these statements with how Mises describes profit in the sense that Fool on the Hill seems to be conveying:

Human Action - XV. THE MARKET: 8. Entrepreneurial Profit and Loss

Profit, in a broader sense, is the gain derived from action…To make profit is invariably the aim sought by any action.

Profit and loss in this original sense are psychic phenomena and as such not open to measurement and a mode of expression which could convey to other people precise information concerning their intensity. A man can tell a fellow man that a suits him better than b; but he cannot communicate to another man, except in vague and indistinct terms, how much the satisfaction derived from a exceeds that derived from b.

It seems to me that you are using a more specific definition of profit (in terms of the market economy) to speak about the broader definition of profit that pertains to action. Am I misunderstanding you?

[Fool_on_the_Hill]

I’m not sure I understand you. If I am sitting at my desk, and I want to be outside, I have to act for that state of affair to come about (putting aside the possibility of the roof blowing off or something). If i just continue to sit at my desk, I’m just not going to end up outside.

But according to Mises, sitting at your desk is also acting:

Praxeology consequently does not distinguish between “active” or energetic and “passive” or indolent man. The vigorous man industriously striving for the improvement of his condition acts neither more nor less than the lethargic man who sluggishly takes things as they come. For to do nothing and to be idle are also action, they too determine the course of events. Wherever the conditions for human interference are present, man acts no matter whether he interferes or refrains from interfering. He who endures what he could change acts no less than he who interferes in order to attain another result. A man who abstains from influencing the operation of physiological and instinctive factors which he could influence also acts. Action is not only doing but no less omitting to do what possibly could be done.

So my interpretation of the action axiom is that its not about “doing something”–what we normally mean by the word action–but rather about making choices. Since doing nothing is included in the action axiom, the concept of exchange as commonly understood can’t be derived from the axiom.

What? If its impossible to arrive at point 1 without arriving at point 2, then point 2 is constitutive of point 1. So what? They may be different temporal states, but since they can never exist separately, it doesn’t make sense to talk about them as different ends. Someone might be confused and think that they could be separate, but that’s when you come along and show why they’re wrong.

It might be possible to be at point 1 without arriving at point 2. One could arrive at point C or point D. The thing is, one can’t stay at point 1 because one can’t peddle a bike in place. If we are always acting, then we are always aiming at an end that is different from where we are. This seems to imply that we enter different states even if we stay still.

Right, but no one is saying that, and if they are, they don’t mean it the way you do. Mises uses happiness as a formal concept which means the satisfaction of wants (ends). Its not that you gain “hapiness,” its that you are satisfying more and more wants. And yeah, wants change.

But to me, it does sound like Mises is saying that:

In colloquial speech we call a man “happy” who has succeeded in attaining his ends. A more adequate description of his state would be that he is happier than he was before.

If we use the definition you provided, then it seems like saying “you are happier when you become a lawyer than you were when you were in law school” would be correct because you’ve satisfied a greater quantity of wants by the time you become a lawyer. My problem is that this is an unorthodox definition of happiness that presents many opportunities for equivocation.

[Fool_on_the_Hill]

Wow. Respect to your fair-mindedness, a rare virtue these days.

What you’re missing is that there is a pre-condition to action and that is want. Mises clearly makes this point early on while defining action. An individual who experiences no wants and who is in a perfect state of fulfillment will not act because he has no reason to act. It is only once want arises that the individual experiences some sort of uneasiness that impels him to act and relieve the felt uneasiness.

Yes, I read that part. But I am having trouble reconciling it with the part I quoted above about how doing nothing constitutes “action.” In that part, it seems that Mises’s claim is that a want to do nothing is still a want. Thus, wants are always with us provided we are conscious.

Mises is clear in the section on Autistic Exchange that he is using the word “exchange” very loosely, as in, “exchanging one state of affairs for another.” The point of the discussion on autistic exchange is to make it clear that coercive situations cannot be recast as “voluntary exchange under an asymmetrical power relationship”. In other words, when the mugger sticks a gun in your ribs, you are not “choosing” between dying and giving him your wallet. He is acting autistically to take your wallet. He will have it no matter which “choice” you make. Conversely, actions that benefit others (for example, the genius street musician) without expectation of payment or reward are also a kind of autistic exchange.

Some of the mainstream types get confused on this point and want to treat coercive situations as non-equilibrium conditions of voluntary exchange. What they are missing is that voluntariness does not refer solely to the inalienable will but to the general conditions under which the exercise of that will can make a difference. Your wishes do not matter to the weather or the mugger, the actions of either are not a function of your choice.

Clayton -

I didn’t get that out of that section, though as I said, I jumped ahead to the section and probably didn’t grasp the full context. I agree that one can’t call coercion “voluntary exchange under an asymmetrical power relationship.” But that’s not because such an occurrence isn’t exchange, but that such an occurrence isn’t voluntary. I think we can speak of involuntary exchange. But once we allow this, we must admit that the concept of exchange isn’t derived from the action axiom. The action axiom is about voluntary behaviors and therefore can’t contain a concept that applies to involuntary processes. Autistic exchange, on the other hand, seems to be merely a restatement of the action axiom. Autistic exchange is thus not exchange at all.

But even during coercive situations, the action axiom still applies. I would say giving your money to the robber is choosing–is purposeful behavior. You prefer that action over the others. The difference seems to be, the other person is doing something that you don’t want them to do that affects your behavior in some way. But exchange is not derived from the action axiom anymore than coercion is.

[Fool_on_the_Hill]

Another thing. We said earlier that we expect to benefit from achieving our ends. Given this, it would then be contradictory to say that happiness (i.e. benefit) is the result of achieving our ends. If we only expect to benefit, then what determines what benefits us must be quite separate (that is, problematic and not apodictic) from the fulfillment of our ends. We choose it because we think it is good for us, not we think it is good for us because we choose it.