INTRODUCTION
This
essay is an attempt to demonstrate that Mises’s praxeology
does not contradict Christian philosophy. To develop this
thesis, several concepts must be defined. I use the term Christian
philosophy similar to the way Gilson used it, namely, as a
philosophical statement that demonstrates the freedom and
personal nature of God, the spiritual character of human intelligence,
free will, and an objective moral order.(1) The principal
author of these arguments is Thomas Aquinas, but this does
not exclude the influence of others, including contemporary
thinkers, who would be useful for the same philosophical purposes.(2)
For
the two concepts to be in a noncontradictory relation means
that there is no mutual implication between them, such that
one does not necessarily deny the other. From a logical perspective
this is quite elementary, but its philosophical implications
must not be understated.
The
difficulty for us comes in deciphering what is meant by "Mises’s
praxeology." Having studied his Human Action, I think
that praxeology is the hard core, as Lakatos would say, of
economic theory. This concept includes the following items:
a)
praxeology’s central axiom
b) the theorems deduced from it
c) the a priori methodology employed in praxeology
d) the general nature of praxeology
PRAXEOLOGY'S
CENTRAL AXIOM
An
axiom is a statement not demonstrable in system a, but could
be a theorem of system b. For Mises, praxeology’s central
axiom is that human action is a purposeful attempt to
substitute a more satisfactory state of affairs for a less
satisfactory one.(3) This statement could also be a theorem
of another system. My central point is simply that Mises’s
praxeology does not entail a neo-Kantian epistemology; it
could function as a theorem within a Thomistic philosophical
structure.
To
begin, let us focus on two famous statements regarding human
action from the Summa Contra Gentiles,(4) Book III,
chapters two and three: "Omne agens agit propter finem"
and "Omne agens agit propter bonum." That is to
say, every subject acts toward an end that is a good for him.
Metaphysically speaking, aside from the Divine essence, in
all other acting subjects individual human action implies
the change from potency to act, and this act implies a gradually
increasing perfection of the acting subject.
Rational
behavior adds to the acting subject’s intelligence and
free will, so we must talk in this case of an acting person
who knows that she is using limited means to achieve ends
that are not limited per se. In the case of human action,
we must account for the fact that this action is the result
of a substantial unity. Aquinas states clearly that human
intelligence utilizes the senses even in the process of abstract
thought. Senses are, therefore, instrumental causes within
the intellectual process. In Thomistic philosophical reflection,
the passions are not separable from rational behavior and
the exercise of free will. In fact, Aquinas only completely
excludes human unconsciousness.
But
there are other important properties that are not excluded
from human action that figure prominently in Mises’s
magnum opus. For example, error is not excluded. Human courses
of action may simply be mistaken, misguided, or simply unfruitful.
Rationality does not entail that the allocation of means to
ends will always be correct. Uncertainty cannot be excluded
either. That is to say, the acting person has limited knowledge,
so that she cannot discern either important secondary values
or preferences, or the future consequences of her choices.
Similarly, ignorance is an essential property of human action.
Human actors not only do not have complete information regarding
the means they need, but they also do not know that they do
not know it.(5) Finally, since evil cannot be excluded, given
free will, the attempted end could contradict the human being’s
ultimate end (God),(6) but even then, it is a rational and
free relation between a means and an end, which qualifies
it as a human action.
It
makes sense to view human action as a purposeful attempt to
substitute a more satisfactory state of affairs for a less
satisfactory one. First, because all human action assumes
an uncoerced human will; and second, because every human action
implies a change from potency to act, even in the case of
evil.(7)
THE
PRAXEOLOGICAL THEOREMS
The
praxeological theorems are the formal implications of the
praxeological central axiom. This is one of the more problematic
aspects of Mises’s system. The terminology he uses tends
to sound materialistic because we are accustomed to understanding
words such as gain, profit, and cost, in their "catallactic,"
or market process, sense. But the praxeological meaning of
these words may also be formalized. If I say, for example,
that every human action has a cost and a possible gain, or
an allocation of means to ends, I may not be using those concepts
with materialistic or consumerist ends in view. I am only
stating that an action gains when it achieves its end; the
value given to the abandoned scenario is its cost; the allocation
of scarce means is the "economic" character of every
human action. The concepts of gain, cost, and allocation are
applicable to every human action, because they are deduced
from the central axiom. In other words, these concepts function
as praxeological theorems.(8)
Among
those theorems, scarcity, subjective value, gain, allocation,
marginal productivity, time preference, and originary interest
are the most important. They are universal to all human action;
however, they are also the principal axioms of catallactic
theory, and are directly applicable to the analysis of market
process. Of these theorems, subjective value proves to be
the most difficult for Thomists. According to Aquinas, every
being is good in himself as a transcendental property.(9)
Each being stands in close relation to an objective moral
order, where moral values are not defined in relation to subjective
human preferences, but in view of human nature as such and
its ultimate end, God. But this seems to contradict praxeologically-based
subjective value theory. However, if concepts are clearly
defined and articulated, no such contradiction will result.
Valuation
occurs when a person chooses between option a and option b.
Valuing necessarily reflects the internal scale of preferences
of the acting person. If John desires good x, and x1 is a
means to achieve it, x1 has a subjective value, that is to
say, is valuable to John, given his subjective preferences.
John could be mistaken regarding his preferences, or ends,
which includes the possibility of moral error, or erroneous
with respect to the real capacity of x1 to achieve x. But
as we have already mentioned, error is a natural aspect of
human rationality.
It
should be apparent that this understanding of valuation does
not contradict Aquinas's "bonum" theory. Everything
is good in two ways: first, because it has been created by
God, and second, because moral values have nothing to do with
subjective preferences but, rather, with human nature itself.
Consequently,
many people have confused the transcendental meaning of the
concept of "good" in Aquinas with the praxeological
notion of subjective value. But these meanings, however complementary,
remain distinct. The book X, for example, could have a subjective
value for me, given my studies, setting aside for the moment
that it is an objective good because it is capable of being
desired. Thus, a thing could be very important in itself while
its appeal to a broad range of people may be significantly
diminished.
THE
"A PRIORI METHODOLOGY"
As
mentioned previously, I intend to supplement Mises’s
Kantian epistemology with a Thomistic epistemology. Methodologically,
however, the a priori character of praxeology remains unaltered
for two reasons. First, the central axiom is established prior
to any empirical testing. The reason is that it is a theorem
of another philosophical system, namely, Thomism. Once again,
the ultimate foundations of Aquinas’s philosophy is
the evidence of participated being, which is not susceptible
to any kind of empirical testing. It is not, however, beyond
any kind of experience.
The
praxeological theorems are also prior to empirical testing
because they are logically deduced from the central axiom,
and given that this central axiom is true, the conclusions–that
is to say, those theorems–are true if the deduction
is valid. So empirical testing is not necessary. It is also
impossible because they are essential properties of human
action that are, in themselves, beyond any kind of empirical
testing.
In
this sense, praxeological methodology is a priori,
meaning it is beyond empirical testing. This is not because
of a result of a neo-Kantian theory of knowledge, as in Mises,
but because the central axiom has been grounded in a Thomistic
philosophical framework. In economic science the case is somewhat
different, but I will briefly explain this at a later point.
DEFINITION
OF PRAXEOLOGY
So
what is praxeology? Praxeology is the science that studies
human action from the point of view of the central axiom’s
formal implications.(10) Thus, given this succinct definition,
it is now possible to respond to Caldwell's objections:
One
may begin by asking, what are the basic postulates of praxeology?
Clearly, the ‘fundamental axiom’ that all human
action is rational is to be included, but what about such
categories as teleology and valuation process, cause and effect,
time, and the uncertainty of the future: are they equally
fundamental? And just what is meant by such terms as ‘teleology’
and ‘uncertainty’; their definitions are less
precise than that of rationality in the Misesian system.(11)
I
would respond by saying that the central axiom is singular;
its methodological character is that of an axiom, and its
"gnoseological" character is that of a theorem in
the Thomistic philosophy. So, praxeology is not a priori in
a neo-Kantian sense but in a Thomistic sense, as I have already
explained. In addition, philosophical issues such as the causality
principle, free will, and final cause are grounded and defined
in the Thomistic meta-system I am using as the ultimate foundation
of praxeology.
CONCLUSION
There
are three aspects to my general conclusion. First, Mises’s
praxeology is not a materialistic conception of human action.
While his use of key terms may sound materialistic, his characterization
of rationality as a free allocation of scarce means to infinite
ends is universally applicable to every human action, including
the most altruistic ones. This characterization of rationality,
according to Kirzner, is open to an extraordinary paradigm
where there is no an algorithmic calculation of means and
ends, but a decision open to uncertainty and error, where
the framework of ends and means is not given but discovered.(12)
Nothing could be further removed from the rationalistic, materialistic,
and unreal abstraction of homo economicus.
Second,
the ultimate foundation of this kind of rationality is not
to be found in Kant but in Aquinas. It is possible to conclude
that Misesian economic theory is in clear contradiction with
Christian philosophy, given that praxeology is the core of
economics, with Mises himself linking praxeology to a neo-Kantian
theory of knowledge. But on this point Mises is mistaken.
He failed to realize that his own praxeology was not inextricably
tied to a neo-Kantian framework. On the contrary, a Thomistic
understanding provides a better foundation for free will and
rationality. But this does not imply that Mises’s praxeology
must be completely transformed.
My
last clarification is important from a methodological standpoint.
Somebody could ask about the profit-maximization principle
that Mises uses to deduce the theory of market process, in
the same way that Hayek uses his "learning factor"
(13) and Kirzner his alertness theory. Mises claims that economic
theory is also a priori. If economic theory were a priori
as well, the profit-maximization principle would also necessarily
be a priori. This does not accord with all that has been discussed
thus far with regard to rationality.
In
my judgment, praxeology is completely a priori, but economics
is not. The maximization hypothesis and the alertness factor
(which are necessary for deducing the tendency towards equilibrium
in a market process theory) are auxiliary hypotheses, which
are to be postulated between praxeology and catallactics.
This methodological clarification (similar to Hayek and Machlup’s
middle ground (14) between extreme apriorism and "ultra-empiricism")
has two main consequences: one is philosophical, the other
methodological.
Philosophically,
the profit-maximization behavior cannot be postulated as a
person’s necessary property but only as an auxiliary
hypothesis in order to deduce certain economic laws. Prima
facie, profit-maximizing behavior is morally neutral. The
morality of the action depends upon the object, goal, and
circumstances of the action. The methodological consequence
is that economic laws remain prior to empirical testing–as
is every model in contemporary post-Popperian epistemology–but
are not necessary from an ontological point of view.
I
would like to conclude with a final philosophical observation.
This kind of discussion is important, because very few Thomistic
thinkers have realized that Austrian economic theory and methodology
are capable of establishing a fruitful dialogue with Christian
philosophy. Very few Christian thinkers, especially those
in the philosophical tradition of Aquinas, have seen the value
of such a dialogue. Why? The simple reason is that they reject
the neo-Kantian metaphysical agnosticism of Mises and Hayek.
However, neither metaphysical agnosticism nor a neo-Kantian
theory of knowledge are necessary presuppositions of Mises’s
theory of human action or Austrian economic methodology.
(1)
E. Gilson, Elementos de filospfiia cristiana (Madrid: Rialp,
1981).
(2)
D. Gamarra, "Algunas caloraciones históricas del
neotomismo," XXII Thomistic Week (September 9th, 1997).
(3)
Ludwig von Mises, Human Action (Chicago: Contemporary Books,
Inc.,1963), 97.
(4)
Saint Thomas Aquinas, Summa Contra Gentiles (Notre Dame, IN:
University of Notre Dame Press, 1975).
(5)
Israel M. Kirzner, The Meaning of Market Process (New York:
Routledge, 1992).
(6)
Saint Thomas Aquinas, Summa Theologia (Torino: Marietti, 1963),
I-II, Q. 2, a. 8c.
(7)
Aquinas, Summa Contra Gentiles, chaps. 4 and 5.
(8)
Mises, Human Action, Part 1, chap. IV, point 4.
(9)
Saint Thomas Aquinas, Quaestiones Disputatae, De Veritate
(Torino: Marietti, 1964), Q.I. a lc.
(10)
Murray N. Rothbard, Man, Economy and State (Los Angeles: Nash
Publishing, 1970), chap. 1.
(11)
B. Caldwell, "Praxeology and Its Critics: an Appraisal,"
History of Political Economy 16 (1984): 3.
(12)
Kirzner, The Meaning of Market Process, chaps. 9 and 10.
(13)
F. A. Hayek, "Economics and Knowledge," in Individualism
and Economic Order (Chicago: University of Chicago Press,
1980).
(14)
Gabriel J. Zanotti, "Caminos abiertos," Libertas
25 (1997): 145-236.
|
