"Ultimate Foundation of Economic Science" Reading Group Thread

Miscellaneous General
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21

Not necessarily. I think, and this has been argued above, that what Mises calls regularity is equivalent to what Hoppe calls time-invariant causes (at least, this connection helped me make sense of what Mises was saying; and it seems to fit when Mises uses the word). In this sense, the law of cause and effect is a regularity implied in the action axiom (that man acts because of a felt uneasiness). Action itself would be a regularity. So there is at least one regularity that is a priori (the action axiom and all it implies: time, causality, space, profit, loss, value etc.)

Maybe not in the way you phrase it, but yes: empiricism tacitly assumes a priori truths (hint: any statement regarding the existence of synthetic a priori propositions -whether they exist or not- would itself be a synthetic a priori proposition). To see explanations of this, I recommend this paper and this book by Hoppe.

Seems right to me. Marx flip-flopped a lot in his life time from the inevitability of communism (seeing it as “matured capitalism”) to his idea that communism can only be brought about by revolution (typically, violent revolution). Of course, the failure of the Paris Commune, often hailed as “the first assumption of power by the working class during the Industrial Revolution,” was so spectacular lasting only from March to May 1871, that Marx revised his Communist Manifesto to stress that communism can only be brought about as a result of the maturity of capitalism. I wouldn’t take Marx to seriously, but Mises trashes Marx in his Marxism Unmasked.

22

Maybe I’m misunderstanding the difference between a priori/ a posteriori, but isn’t the fact that man acts itself an observation? One could easily construct a mental reality where such is the case, but the reason that the action axiom is a worthy basis for economics is that it is observably true in actuality, no?

Anyways from what I understood of his writings, regularity meant the natural laws of existence (gravity and such). That they are the principles of existence and not merely happy coincidences is the a priori statement, no? Answer me this: can a priori statements not be derived directly from observation (a posteriori knowledge)?

23

No. We can observe physical phenomena, but to recognize such physical phenomena as action, we would need to conceptualize such phenomena as such; empirical observation is not sufficient, nor is it needed, to recognize the validity of the action axiom. I could easily see you lift your left arm and scratch your armpit with your right arm; this is all that can be observed. To say that you scratch your armpit (means) to relieve an itch (end) would be to place such significance on this observation as to leave the scope of empiricism and enter rational analysis. Action, as the proposition that human action is purposeful behavior, cannot be merely observed in the empirical sense. The paper and book by Hoppe I recommend above go into this more in-depth if you would like to read more.

The reason that the action axiom is a worthy basis for economics is that economics is a category of praxeology.

All economic propositions reached using the praxeological methodology are necessarily true so long as the logic used (inferences made) is valid. This is to say, if one can scrutinize an economic propositions starting with the proposition and working its way back to the action axiom without detecting a logical fallacy or some other such error (such as a false assumption), then the economic proposition must be true before observation. To deny the truth of the proposition, without subjecting it to the scrutiny just described, would be “no less foolish than those seventeenth-century astronomers were who refused to look through the telescope that would have shown them that Galileo was right and they were wrong.”

In fact, the Austrian method must be superior to the empirical method (observation) because the Austrian method tells us what must be true by definition. The empirical method, Hoppe goes over this in that book, can only tell us what would be the case in such and such a condition; empirical propositions are of such form: If A, then B. NB: If B does follow A this is a confirmation of the hypothesis; this does NOT prove the validity of the proposition because A and B are universal terms and, as such, a case can be conceived where B does not follow A. Conversely, if B does not follow A, then this is a falsification of the hypothesis: this does NOT prove the proposition false, as the empiricist is capable of saying that B did not follow A because some previously unknown variable was not accounted for.

Of course, this means that empirical hypotheses can be tested an infinite amount of times while proposing nothing that is either true or false!

Yes. This is synonymous with time-invariantly operating causes.

No- they are two distinct categories of epistemology (one being rationalism, the other empiricism).

24

doesn’t the assertion of natural regularity somehow involve a posteriori knowledge?

Yes. As Mises writes in section 4:

The first and basic achievement of thinking is the awareness of constant relations among the external phenomena that affect our senses.

Thinking of the world as posssesing regularity [which means, I now see from reading the book, that there exist A’s and B’s in the world such that A happening always results in B happening, which we decide to call A causes B] is an achievement, meaning you don’t get it for free, it is not innate in you, you achieve it by thinking. Not only that, you acheive it by observing and thinking about the external world. All of which makes it aposteriori.

However, and there is a big however, this acheivement comes very early on, and gets ingrained so deeply in our way of looking at the world that…

  1. the negation of what it asserts is unthinkable for the human mind [once it learns this lesson] and appears to it as nonsense.

  2. Also, every time we approach any problem whatever, we approach it with the assumption of regularity [AKA reliable causes that produce reliable effects] in the universe [for otherwise there would be no point in trying anything, since its result would be some random thing].

Mises mentions these two things when he writes about causality, the stepchild of regularity:

Whatever philosophers may say about causality, the fact remains that no action could be performed by men not guided by it. Neither can we imagine a mind not aware of the nexus of cause and effect.

But these two things are what really matter, the important features, of a priori knowledge, as Mises writes in section 3.

“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; secondly, that this a priori concept or proposition is necessarily implied in our mental approach to all the problems concerned, i.e., in our thinking and acting concerning these problems.”

So that, even though regularity is a posteriori to a stickler, Mises is going to go ahead and call it a priori.

He says this explicitly when he writes:

In this sense we may speak of causality as a category or an a priori of thinking and acting.

The phrase “in this sense” always means “not in the full, strict sense of the word, but in a partial sense of the word”.

In parrallel, mustn’t all scientific experimentation involve both a posteriori and a priori truth?

That is exactly the point Mises is trying to get across. The posisvists apparently pride themselves on not using any apriori concepts or assumptions, and being wholly a posteriori. Mises is pointing out that they certainly assume regularity and cause and effect, which is a priori. [Not to mention the rules of logic, such as a thing cannot be both A and not A at the same time. I wonder why he is laying such heavy stress on them using regularity and cause and effect].

So a posteriori does not need to be proven because it only needs to be recorded…

That which is recorded is what we call history. A posteriori knowledge is more than that. It is a knowledge of the future based on the history we have recorded or seen. For example, the sun having risen every day that makind knows about is history. From this history, we gain aposteriori knowledge that the sun will rise tomorrow, too. This kind of knowledge is called induction. Of course it is very shaky philosophically [though I admit this is ignoring Clayton’s assertion that there is some math that can prove it, mainly because of my ignorance of that math], but it works and it’s all we’ve got, really. Again, Mises is pointing out that all a posteriori knowledge has a fat dose of a priori mixed into it, the assumptions of regularity and causality.

This makes the whole priori/posteriori dichotomy confusing to me, since empricist economists always bash a priori methods but isn’t an experiment (even if no economic experiment is possible) also an a priori assertion, if one seeks to use it as a device of prediction?

See the above.

He throws Marx away with the usual deftness, turning his own materialist philosophy against him. If I am right in understanding, the material productive forces alone decide the course of history, that there is no correct or incorrect only the march of history. This of course implies that Marx’s own writings have no significance. Someone correct me if I’m wrong on this.

The way I understand it is this. Say you have an adding machine. When you ask it 2+2= what, it certainly doesn’t decide by itself what the answer is. The builder of the machine set it up in such a way that gives the answer 4. The builder could equally have built it to give the answer 3. In the latter case, of course, the adding machine gives the wrong answer, but of course the machine itself doesn’t know it’s the wrong answer.

Marx was saying that all human beings are adding machines. Whatever they think is determined not by them, but by something outside them [=materal productive forces], which are in this sense the builders of those complex adding machines, people. And since people are subjected to these forces in different ways, they will think differently, like two adding machines that have been built to give different answers to the same question.

Mises has two objections to this. First, that it is ridiculous to assume that material productive forces sit around and think and plan how to build people. He is saying that Marx seemed to be asserting in some of his writings that material productive forces actually do that, that they are sentient beings of some kind that have plans and minds and schemes. He adds that Marx himself retreated somewhat in his later writings from such a ridiculous notion.

There is a second objection Mises raises, one that applies even if we assume that material productive forces are not sentient beings. As long as we still assume that humans think what they think as a result of something outside them [=material productive forces] building them a certain way, then how do humans know what is true or false? How do we know that 2+2 is 4? Maybe it’s really 3, but the material productive forces have molded our minds to mistakenly think it’s 4.

For that matter, how does Marx know that what he wrote is correct? The only reason he thinks it is correct is because the material productive forces acting upon him in a certain way made him think he’s right. But maybe he’s one of those adding machines built to think 2+2=3, and Adam Smith was the one built correctly, who thought capitalism is great stuff?

25

Fair enough. We can’t observe man ‘acting’, but we can observe him scratching his armpit. To act implies a means and an end, both of which are conceptualizations outside the frame of empiricism.

Ok so let me rephrase :P. So economics is a category of praxeology because it is observably true in actuality that man acts?

Agreed.

Gonna have to call bullshit here, based on my understanding of the two forms of knowledge. A Priori is an assertion on what things will do. Praxeology is the study of the action of man. Man is not a conceptualization, but an observable actuality. Mises did not assert, apriori, that man exists. He observed it as such and founded the action axiom from there, no?

26

No- as you state earlier in this post action cannot be observed. Economics is a category of human action dealing specifically with market transactions amongst various actors. That is, unless you would like to state that economics is not a category of praxeology because it is not a science dealing with a specific type of human action …

Assuming one knows the definition of “man” and understands what the action axiom states the action axiom can be understood a priori- one does not have to observe man to understood what is meant by the term “man.” One can observe an animal that has two arms, hands, a head, feet, and all the other characteristics associated with the term man, but man does not need to be observed per se in order to make valid the action axiom. Of the rationalist nature of language, you can refer to A Theory of Socialism and Capitalism (esp. “The Socialism of Social Engineering and The Foundations of Economic Analysis”).

To clarify, a statement made a priori is a statement that is made without regard to experience. Whether the a priori statement is analytic (based in the definition of terms used in the proposition) or synthetic (implied by introspective reflection on the proposition), it has no bearing on what “will happen” per se. There are two categories of a priori propositions: analytic a priori and synthetic a priori.

The validity of the action axiom is known a priori; it is impossible for one to “observe” differently as doing so would concede the validity of the action axiom because observation itself is an action (to say as much would be as foolish as stating that one saw a bird that is colored, both, red and non-red all over its body at the same time). As such, it is not necessary for man to exist, nor is it necessary for his existence to be observed (nor is observation sufficient), for the action axiom to be valid; insofar as man exists, he must act.

27

“assuming one knows the definition of ‘man’ and under stands…”

That’s the catch though isn’t it? In order to speak of man, his/her existence must first be established. The assumption of man’s existence is experential, no?

Lest I flounder further could you define A Priori / A Posteriori in your terms?

28

Again, the existence of man is irrelevant to the validity of the action axiom: insofar as man exists, he must act; whether he exists is besides the point (remember: observation itself is an action).

Regarding the understanding of language, the catch… isn’t. Again, Hoppe goes over the rationalist nature of language in A Theory of Socialism and Capitalism if you are interested for an in-depth treatment of the subject. The fact that one can understand what is meant by the grouping of letters implies that one is capable of attaching significance to something absent observation.

For instance, what is one to do in order to define “dog?” Short of providing a definition found in any dictionary (which an empiricist would regard as merely a tautology providing no knowledge of reality) one is forced to find a dog and point to it: dog. How does one establish the link between what is done/said with the definition of “dog?” The fact that one is capable of understanding what is meant (let alone capable of constructing an artificial means of communicating ideas called language) demonstrates that one is capable of understanding that language is a convention.

Conventions must be understood a priori in order to understand that “dog” means dog. The ability of one to make propositions presupposes that one understands the definition of a convention; therefore, knowledge of language must be considered a priori knowledge. One cannot understand a definition of a word merely by making an actual definition of the term without already assuming the a priori nature of language. As such, one is forced to make the sound [dog] while pointing to a dog in order to say that this means “dog.” To have this definition of a word, without constant reference to see that it still communicates the same idea as it did when one last read its definition, is to assume that there is a priori knowledge of the definition of any term; this fact alone implies that observation is not sufficient to define terms. As such, Hoppe concludes:

To define definition ostensively would be entirely meaningless, unless one already knew that the particular sound made was supposed to signify something whose identification should be assisted by pointing, and how then to identify particular objects as instances of general, abstract properties. In short, in order to define any term by convention, a speaker must be assumed to have a priori knowledge of the real meaning—the real definition—of “definition.”

Language must be considered a priori in that it must be presupposed of any speaker speaking any language, is that of how to make real conventions, how to make a proposition by making a statement (i.e., how to mean something by saying something) and how to make a real definition and identify particular instances of general properties.

Obviously, this follows for “man” as well as “dog.”

Ahem:

​

A statement made a posteriori is derived from experience.

29

I’m trying to understand this so bear with me. Language is a priori because I can say “dog” and communicate to you a dog, without the presence of an actual dog as requisite, correct? Does this not depend on your foreknowledge of the existence of a dog? If neither of us had ever seen a dog, a dictionary definition like this “Furry Four legged carnivorous mammal of the canine family” would not be useful for us. A dog might as well be a bear or a tiger. Must any form of knowledge be either a priori or a posteriori?

30

How am I capable of knowing that “dog” still means dog, but for a priori knowledge of what the definition of dog is? Because of this necessary determinant of language, “observation is not sufficient to define terms.”

Even listing that definition of dog, if that was what we were to leave it as, would presuppose the a priori nature of language- after all, if this was not the case, we would then have to define all the terms used in the definition; and even then we would have no capability of understanding that the definitions of the words have not changed from what they were just a few moments ago, but for a priori knowledge. I would not be capable of understanding that your extended index finger at this creature would signify that the noises uttered from your mouth are connected to that creature, in some way, but for the presupposition of definitions as there is no way to connect some definition of some term with a past experience with a dog, but for the understanding of the ideas represented by the words.

Yes.

A priori: not based on experience

A posteriori: based on experience

Insofar as language is concerned, we are examining what must be classified as a priori knowledge (knowledge of what language/convention is is presupposed when one makes a proposition). Insofar as the type of propositions made, they must be categorized as stemming from a priori knowledge or a posteriori knowledge. With regards to knowledge, the two methodologies of epistemology are rationalism and empiricism; ultimately, however, every epistemological proposition is based on a priori language (after all, these propositions must be communicated somehow).

31

Thanks that was helpful.