Abstract
As mentioned, the a priori of the finality of ends, or teleology implies a methodological dualism by stressing subjective ideas of individual human actors as explanations of action and consequent social wholes.
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Notes
- 1.
Methodological subjectivism in the sense of making intended aims and related perceived meanings the objects of study (von Hayek 1943).
- 2.
The tendency to want to apply the methods of physics to the social sciences is sometimes labeled “panphysicalism,” or methodological monism, or in the words of von Hayek, “scientism” (von Hayek 1942). It is the teaching “that the procedures of physics are the only scientific method of all branches of science. It denies that any essential differences exist between the natural sciences and the sciences of human action” (von Mises 2007, p. 243).
- 3.
This is the second of two criteria for a hard apriorism mentioned earlier.
- 4.
To von Mises the notion of “free will” is “that in the production of events something can be instrumental about which the natural sciences cannot convey any information, something that the natural sciences cannot even notice” (von Mises 1962, p. 58).
- 5.
von Hayek (1943) points out that science is still a far cry from explaining in a formulaic manner how all these categorizations are made. After all they are not about physical properties, but about what things or people mean to a person, how he perceives them, and how he reacts to them. Moreover, while it may in principle be possible to trace the classifications and conceptualizations people infer to physical properties, this is such a complex task that “we should probably have to wait forever” (von Hayek 1943). Moreover, this would not help the Praxeologist much since he would still be left with the task of figuring out how action leads to social structure or spontaneous organization (von Hayek 1942). He would still have to use the teleological mental entities as a starting point for understanding human action (von Hayek 1943).
- 6.
In fact, even with relatively simple contexts of isolated physical phenomena, mathematical expression may face considerable difficulty and resort to approximations. For example, “the Schrodinger equation for the hydrogen atom, which he is able to solve only after a considerable effort of functional analysis and special function theory, is not a literally correct description of this atom, but only an approximation…” (Schwartz 2006). Thus, there is considerable difficulty in applying mathematics to social science, as it “is able to deal successfully only with the simplest of situations, … the ability to keep many threads in hand, to draw for an argument from many disparate sources, is quite foreign to mathematics” (Schwartz 2006). Indeed, it has been stated that the application of mathematical models in economics involves ambiguities that are intrinsically inevitable (Velupillai 2005).
- 7.
Complexity can be defined as the “minimum number of elements of which an instance of the pattern must consist in order to exhibit all the characteristic attributes of the class of patterns in question…” (von Hayek 1994). It can also be conceptualized as “the joint effects brought about by the operation of a multiplicity of elements” of both physical and psychological nature (von Mises 2007, p. 208).
- 8.
The first to use the term methodological individualism, however, was Joseph Schumpeter, and it was his teacher Max Weber that first elaborated this principle without actually naming it (Heath 2011). Weber’s elaboration was influenced by Wilhelm Dilthey, who had emphasized the importance of understanding social phenomena based on our own humanity and pointed out that this is something unattainable in the natural sciences (Walliman 2006, pp. 23–24).
- 9.
Empiricist Karl Popper declared more than half a century ago that the appropriate method of social science is “methodological individualism”: We need studies, based on methodological individualism, of the social institutions through which ideas may spread and captivate individuals, of the way in which new traditions may be created, and of the way in which traditions work and break down (Popper 1945).
- 10.
Perhaps the most influential proponent of this holistic approach to social properties has been Durkheim, who describes his method as “objective” and “dominated entirely by the idea that social facts are things and must be treated as such” (Durkheim 1966, Chapter Conclusion). However, such a method is also traceable to Marxists like Engels, who stated as an example: “Conflict between productive forces and modes of production is not a conflict engendered in the mind of man…. It exists, in fact, objectively, outside us, independently of the will and actions even of the men that have brought it on” (Engels 2005, p. 66). Notably, such methodological holism was categorized already by Mill as being a kind of “sociological inquiry” that studies “the simultaneous state of all the greater social facts or phenomena” as a whole (Heath 2011; Mill 1882, pp. 630–633). Mill holds that this holistic method when combined with laws of psychology and ethology (character formation) could conceivably be used to predict the future state of society, a realization first to have been made by Comte (Bourdeau 2011; Mill 1882, pp. 602, 633). On the other hand, Comte ascribes to Montesquieu the positivist notion of “political phenomena as subject to invariable laws, like all other phenomena” (Comte and Martineau 2000, p. 166). However, Popper traces the idea of historical evolutionary laws all the way back to Plato as does Gabriel Tarde (Popper 1945; Tarde 2000, p. 17). Besides the abovementioned, major proponents of holism include philosophers George Lewis and George Eliot; social theorist Harriet Martineau, who became a translator of Comte's works; Frederic. Le Play, a pioneer of social surveys; Herbert Spencer, the famous social evolutionist; historians H. T. Buckle and William Lecky; sociologists Espinas, Levy-Bruhl, Durkheim, Francois Simiand, T. Veblen, L. T. Hobhouse and K. Lamprecht (von Hayek 1941, pp. 318–20). A major exception among French sociologists of this period was Gabriel Tarde who was a pioneer in the study of social networks but fell into the shadow of Durkheim and his collectivist approach (von Hayek 1941, p. 320; Katz 2006). Another prominent scholar of a more individualist inclination was of course Max Weber, who was the first to bring a refined individualist methodology to sociology and oppose its collectivism (Roth and Weber 1976; Udehn 2002; Walliman 2006, pp. 23–24).
- 11.
In general systems theory attempts are made to discover high level theories “somewhere between the highly generalized constructions of pure mathematics and the specific theories of the specialized disciplines” (Boulding 1956). Partially this trend could be seen as encouraged by the success of interdisciplinary operations research in World War II (Jackson 2003, pp. 16–17). However, it was also seen as a means to rectify the increasing departmentalization of academia, where “physicists only talk to physicists, economists to economists—worse still, nuclear physicists only talk to nuclear physicist’s and econometricians to econometricians” (Boulding 1956). It was hoped that mathematically expressed meta level theories would help to bring unity to science (Checkland 2000).
However, it should be noted that not all systems thinking approaches are founded on the methodological collectivist approach. Already in the nineteenth century Tarde (2000, pp. 19–22) conceptualized society as a network of individuals communicating beliefs and desire. Peter Checkland's Soft Systems Methodology is another prominent modern example that recognizes the importance of intentional action and sense making (Checkland 2000). In fact, Praxeology could also be considered as a form of systems thinking. In addition, analytical sociology accounts for individualist principles in its mechanisms or models that can be seen as a form of systems theories as well. As stated by Hedstrom and Bearman: “… structural individualism is a methodological doctrine according to which all social facts, their structure and change, are in principle explicable in terms of individuals, their properties, actions, and relations to one another” (Hedstrom and Bearman 2009b).
Clearly, this structural individualism is simply a form of methodological individualism “emphasizing the explanatory importance of relations and relational structures” (Hedstrom and Bearman 2009b). Similarly, Bunge (2004b) calls to “systemism” which is committed to a more moderate holism that “rejects the intuitionist epistemology” often associated with it and thus encourages explaining social aggregate phenomena or systems in terms of Components (parts), Environment, Structure and Mechanisms, or the CESM model. Tilly (2001) is another prominent social scientist that has called for more explanatory mechanisms with a cognitive, environmental or relational focus.
- 12.
Yet the attraction of finding something more than action to explain social facts remains ever persuasive, as Tarde (2011, Chap. I:I) stated: “But are we to consider that human acts are the sole factors of history? Surely this is too simple! And so we bind ourselves to contrive other causes on the type of those useful fictions which are elsewhere imposed upon us, and we congratulate ourselves upon being able at times to give an entirely impersonal color to human phenomena by reason of our lofty, but, truly speaking, obscure, point of view. Let us ward off this vague idealism”.
- 13.
This understandability means that a nominalist social science has to analyze sociological models “in terms of individuals, their attitudes, expectations, relations, etc. (Popper 1945)”.
- 14.
This is the same Bunge that was quoted earlier arguing that a market is a “thing”.
- 15.
Actually, it may be argued that complex concepts aren’t identical even in the natural sciences when all circumstances are considered. It is rather the questions asked and what is seen as relevant to their answers which narrows the picture of reality studied toward some similarity between objects. In the study of history it is the same. It is the questions asked that will make a situation look different or similar. Hence it is true that historical events are highly different from one another as a complete whole, but this does not mean that there is no room for theory based on similarity at all. In fact, the historian needs the natural sciences to explain natural events, and he also needs the dissatisfaction-means-ends logic of Praxeology to develop plausible explanations for human actions (von Hayek 1943).
- 16.
This is very different from the objective and mechanical approach of the natural sciences. In these, one tries to discover realities beyond the human senses, such as the atom. In other words, “science breaks up and replaces the system of classification which our sense qualities represent” (von Hayek 1942). It ignores meanings perceived in objects that are not related to how they react to one another. Hence, natural science not only aims for a high level of precision, but is also disinterested in how things appear. It is rather concerned with discovering a better classification in order to discover the facts behind sensory appearances by employing precise measurement and statistics (von Hayek 1942).
- 17.
There may be unpredictability in the sub-elements of a system. E.g., just like it is not always known how a certain person will behave, it is also not always known how an individual atom will behave.
- 18.
There may be a large amount of interacting variables affecting a physical phenomenon. E.g., Newton’s apple as a simple existential event is explained not by one but several causal laws (Friedman 1984; Hempel 1994; Popper 1945). In fact, some natural science phenomena defy prediction or lab testing altogether (Popper 1945). That is why e.g. “predictive biology is almost unheard of” (Emmott 2008).
- 19.
von Mises (2007, pp. 88–89) states: “What the neo-indeterminist school of physics fails to see is that the proposition: A produces B in n % of the cases and C in the rest of the cases is, epistemologically, not different from the proposition: A always produces B. The former proposition differs from the latter only in combining in its notion of A two elements, B and C, which the perfect form of a causal law would have to distinguish. But no question of contingency is raised. Quantum mechanics does not say: The individual atoms behave like customers choosing dishes in a restaurant or voters casting their ballots. It says: The atoms invariably follow a definite pattern”.
- 20.
Biology shares with social science not only the complexity of events, but due to the uniqueness and continuous change of organisms, biology has also resisted mathematicization (Horgan 1995). Accordingly, “predictive biology is almost unheard of” (Emmott 2008). Hence, it may be tempting to consider social science as analogous to biology, as Herbert Simon indicated in his Nobel memorial lecture: “Human behavior, even rational human behavior, is not to be accounted for by a handful of invariants…. If we wish to be guided by a natural science metaphor, I suggest one drawn from biology rather than physics…. [From it w]e can see the role in science of laws of qualitative structure, and the power of qualitative, as well as quantitative explanation” (Simon 1979).
- 21.
Seemingly simple actions can be difficult to express mathematically. E.g. even relatively simple acts like “posting a letter” or “kicking a ball” involve complex and irregular series of movements that cannot be standardized and defined mathematically. Rather, there are interpretation and rough standards involved in order to describe such acts (Hamlyn 1953). It follows that social events are even more problematic. Accordingly, Bunge (2004a) observed that “mathematical ‘catastrophes’ are singularities in manifolds, not social disasters; mathematical ‘chaos’ is the complexity involved in certain nonlinear differential equations; and the ‘systems’ that dynamical systems theory deals with are not concrete systems but systems of ordinary differential equations”. Accordingly, statistics cannot measure the whole of society in the way movement is measured in physics, so there can be no “laws of motion of society” in the collective holistic sense because one can only measure particular aspects of society and not the whole of it (Popper 1945).
- 22.
It is noteworthy that Popper proposes such a focus for social science and warns that an analogy between natural science and social science can only be employed “as far as it is fruitful” (Popper 1944b). Accordingly, he stresses discovering patterns of typical unintended social consequences of action to serve as technological laws. These are to serve as guidelines to what cannot be achieved or avoided for a given situation, but unlike laws of natural science these do not attempt to predict what the future will look like (Popper 1959). This methodology applies for both private problems such as worker productivity of business enterprises or charities and to government policies such as interventions in the economy (Popper 1944b).
- 23.
It may be noted that there are a number of important qualitative explanations in the “hard” sciences as well, such as “the cell doctrine in biology”, “the theory of plate tectonics” in geology and “the germ theory of disease” in medicine, the “doctrine of atomism” in chemistry (Newell and Simon 1976; Thagard and Toombs 2005). Accordingly, Herbert Simon emphasized the importance of qualitative explanations in science (Newell and Simon 1976; Simon 1979).
- 24.
It may be noted that Mill (2008, pp. 41–42), in spite of his empiricist views, and more contemporary Knight (2008) and Robbins (2008) all pointed out the a priori or given nature of the facts of human action, and the need for assumptions.
- 25.
He stated that based on understanding personality one may predict how a person is likely to act given a certain situation. However, “since there are infinitely many possible situations, of infinite variety, a full understanding of a man's dispositions does not seem to be possible” (Popper 1972, p. 299).
- 26.
Popper stated: “Admittedly, no creative action can ever be fully explained. Nevertheless, we can try, conjecturally, to give an idealized reconstruction of the problem situation in which the agent found himself, and to that extent make the action “understandable” (or “rationally understandable”), that is to say, adequate to his situation as he saw it. This method of situational analysis may be described as an application of the rationality principle” (Popper 1972, p. 179). Such rational action models would according to Popper serve as baselines for the evaluation of empirical results to see the extent of deviation, a notion suggested earlier by Weber (Popper 1945; Weber 1978, p. 6). This appears to be in conflict with von Mises’ view that empirical data are mere history and cannot be used to test a theory.
- 27.
E.g. as discussed later, we know as actors that purposive acts are subjectively driven by mental acts of choice that “refer either to ultimate ends or to the means to attain ultimate ends. The former are called judgments of value. The latter are technical decisions derived from factual propositions” (von Mises 2007, p. 12). Moreover, one’s experience of being an actor oneself compels one to admit what is self-evidently true of purposive action a priori. These are the categories of action, like means, ends, time, uncertainty, psychic felt uneasiness, etc. For example, we know that we act out of some subjectively felt uneasiness, whether grounded morally, hedonistically or otherwise. Moreover, we know that we choose means based on the hope that it will help us reduce this uneasiness. This is the sort of knowledge that is accepted as axioms a priori by von Misesian economists and praxeologists. It is considered to be part of the inescapable structure of our minds, namely, “the common principle on which they classify external events, provide us with the knowledge of the recurrent elements of which different social structures are built up and in terms of which we can alone describe and explain them” (von Hayek 1942). However, it should be noted that Praxeology carefully segregates theories about social facts that people themselves form. This is because the role of the social scientist is to improve these theories by getting to the real causes of purposive action and social structure. For example, if there is a change in the price of a commodity then people will have many theories as to why it changed and accompanying theories of its value. The praxeologist or social scientist ignores these and tries to find the real concepts and motives that drive and result from action (von Hayek 1942).
- 28.
The most commonly used model, for example, is the model of general equilibrium. It is not a reflection of reality, but a fictional ideal, a model in which there is no change, and therefore no uncertainty, and no profit. In contrast, as Schumpeter (1950, pp. 82–83) points out, the real market economy “is by nature a form or method of economic change and not only never is but never can be stationary”. Other examples include the strategic interactions of game theory and similar simulation models that have been developed mathematically for social science. For example, Thomas Fararo has proposed what he calls the “axiomatic method” where axioms are assumed statements on which all defined terms are based and then “proved statements are obtained by deduction from the axioms of the defined terms” (Fararo 2002).
- 29.
In fact, to develop a demand curve a number of assumptions are made for a typical agent, such as: the consumer is able to compare any two bundles of goods and services and either prefers one over the other or is indifferent; consistency in ranking, so that if the utility of X 1 is preferred to that of X 3, and X 3 is preferred to X 2 then X 1 is preferred to X2; the quantities of goods or services are divisible continuously, to make it a continuous curve, and; monotonicity, or “more is better,” meaning that utility increases with the quantity of a good (O’Sullivan 1987, pp. 77–81). Clearly, such curve models are nothing like the formulas of physics, for even if their assumptions were realistic, one has no real constants to fill into their equations, or even firm knowledge about preference rankings at any particular time, let alone from one time to another.
- 30.
It may in contrast to the above be argued that price is a measure in the social science of value or of a commodity in itself (von Mises 1990c, p. 8). However, prices cannot be considered as measures of either of these, because a transaction takes place only when an actor prefers the good over the money he pays for it. If they were equally preferred, then no transaction would take place. By the very act of purchasing he demonstrates that he prefers one to the other at the time of purchase, and there is no reason to assume that the price is equivalent to the good (von Mises 1990c, p. 8). In this sense, even prices are not measures in the manner we find in physics because they are not measures of a concrete object but social phenomena resulting from unique, ordinal and subjective preferences of individuals.
- 31.
The requirement for resemblance and constant relations is elucidated by Tarde, (2011, Chap. I:I) as follows: “Knowledge of causes is sometimes sufficient for foresight; but knowledge of resemblances always allows of enumeration and measurement, and science depends primarily upon number and measure…. As soon as a new science has staked out its field of characteristic resemblances and repetitions, it must compare them and note the bond of solidarity which unites their concomitant variations”.
- 32.
In Praxeology these would be assumptions that are not the categories of action, i.e., not implied in the concept of purposeful action. After all, if a theorem of purposeful action is wrong, it will not be due to what is implied in the concept of action. Hence, one is left with possible flaws in logic or empirical assumptions.
- 33.
Popper (1945, pp. 86–87) engaged in what looks much like deductive praxeological theorizing. For example, he identified the factors needed for scientific progress as language, writing, and competition of ideas, i.e. competition by means of their presentation, discussion and criticism. He arrived at these factors by first asking how one could arrest scientific progress. This is exactly the type of procedure von Mises used to identify a priori categories of action; without means there is no action, without psychic felt uneasiness there is no action, etc.
- 34.
It should be kept in mind that the value of an object is according to the meaning it is seen to have for an actor.
- 35.
Hülsmann (2003) calls these example and others “counterfactual laws of human action” which reflect “the essential relationships that choice brings about between what exists and what could have existed instead”. Each action is a choice between limited possibilities and their consequences, and each change in the situation of action changes this range of possibilities, like in the choice between saving and consuming. Based on this, the laws of Praxeology allow a priori pattern predictions in an exact manner, even if we cannot know the exact quantitative results (Hülsmann 2003).
- 36.
This appears to be a reference to von Mises’ (1951) calculation problem as outlined in his book “Socialism”.
- 37.
This seems to be a reference to von Hayek’s (1945) knowledge problem.
- 38.
Daniels and Daniels (2006, p. 97) state: “The closest thing we have to a behavioral law, as gravity is a physical law, is that behavior is a function of its consequences. Antecedents get their power from the consequences that are associated with them”.
- 39.
He is not alone in this, Karl Popper makes a similar statement that statistics show trends and tendencies which are existential historical statements and not laws (Popper 1945).
- 40.
Moderate apriorism, on the other hand, proposes only that “in the human sciences empirical testing can only tell us whether or not a theory is applicable to some currently prevailing (or past) situation,” because human values and goals evolve (O’Sullivan 1987, p. 157).
- 41.
It should be noted that in the terminology of von Mises, the term “experience” is equivalent to “empirical data”. For example, he says, “[e]mpiricism proclaims that experience is the only source of human knowledge” (von Mises 1962, p. 27).
- 42.
A full elucidation of these will be made later, but they may be summarized as follows: “Individual human beings exist. Moreover, they do not simply “move,” as do unmotivated atoms or molecules; they act, that is, they have goals and they make choices of means to attain their goals. They order their values or ends in a hierarchy according to whether they attribute greater or lesser importance to them; and they have what they believe is technological knowledge to achieve their goals. All of this action must also take place through time and in a certain space. It is on this basic and evident axiom of human action that the entire structure of praxeological economic theory is built” (Rothbard 1979).
- 43.
His ongoing argument is that since the future is uncertain, and preferences change all the time, such appraisals are most effectively left to entrepreneurs, who serve the consumer by continuously appraising shifts in demand. Government intervention based on past experience, i.e. forecasting, will hamper changes needed due to changes in demand and saving. In other words, governments cannot serve the consumers better than entrepreneurs, and econometrics for forecasting is merely a tool of entrepreneurial business activity that if cleverly used, may improve appraisal activities. It is not an effective tool for determining government policy, because it is based on conjecture, not constant regularity. This view on forecasting may be noted to stands in sharp contrast to Milton Friedman’s “positive economics,” which has the purpose to “make correct predictions” of events (Friedman 1984).
- 44.
This position of von Mises regarding theory can be understood in light of his overarching mission of establishing solid arguments in defense of capitalism. He was not interested in data that could be interpreted in several ways and therefore be easily dismissed by opponents.
- 45.
“The fact that the passage of time is one of the conditions under which action takes place is established empirically and not a priori” (von Mises 2002, p. 25).
- 46.
von Mises (2002, p. 25) defends positive time preference by saying that “[n]o mode of action can be thought of in which satisfaction within a nearer period of the future is not—other things being equal—preferred to that in a later period”.
- 47.
von Mises says: “The disutility of labor is not of a categorical and aprioristic character…. But the real world is conditioned by the disutility of labor. Only theorems based on the assumption that labor is a source of uneasiness are applicable for the comprehension of what is going on in this world” (von Mises 1996, p. 65).
- 48.
Smith (1999) states: “What we learn from such experiments is that any group of people can walk into a room, be incentivized with a well-defined private economic environment, have the rules of the oral double auction explained to them for the first time, and they can make a market that usually converges to a competitive equilibrium, and is 100 % efficient—they maximize the gains from exchange—within two or three repetitions of a trading period. Yet knowledge is dispersed, with no participant informed of market supply and demand, or even understanding what that means. This strikingly demonstrates what Adam Smith called ‘‘a certain propensity in human nature … to truck, barter, and exchange one thing for another’’ (Smith [1776] 1909: 19). Also, it demonstrates von Mises’ assertion that ‘‘Everybody acts on his own behalf; but everybody’s actions aim at the satisfaction of other people’s needs as well as at the satisfaction of his own. Everybody in acting serves his fellow citizens’’ (M, p. 257)”.
- 49.
Only statistically significant results are usually reported in journals. This has damaging effects. First, it gives the impression that the relationship is stronger than it is. For example if one study with a significant result gets published it gives the impression that the relationship is potentially important. However, there may be another 20 studies that show no significant result that never were published. Second, it encourages manipulation of data and reporting (Krawczyk 2008).
- 50.
Likert scale tests are often analyzed by calculating the means, standard deviation and various inferential statistics, but these are inappropriate for ordinal data, because the “average of ‘fair’ and ‘good’ is not ‘fair-and-a-half’; this is true even when one assigns integers to represent ‘fair’ and ‘good’!” (Jamieson et al. 2004).
- 51.
As mentioned earlier, to von Mises economics is the narrow field of establishing universal economic laws. This can be understood in light of his overarching mission of establishing solid arguments in defense of free markets. He was not interested in data that could be interpreted in several ways and therefore be easily dismissed by opponents. This restrictive conception of the field of economics leaves little role for the use of empirical data coming from complex social situations.
- 52.
In interpreting results of studies on human behavioral tendencies it makes sense to remember what Knight (1925) already long ago pointed out as a fundamental problem of empirical data in social science. He called attention to the fact that the observed are human beings with interests, just like the researchers. That is, both parties are subjects and observers as well as controllers and controlled all at the same time. Research results of such studies should therefore be carefully considered from the viewpoint of praxeological interpretive understanding along with all the problems associated with empirical data related to human action as mentioned in the discussion on methodological dualism.
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Tonsberg, T.A., Henderson, J.S. (2016). Methodological Principles Regarding the Role of Empirical Data in Praxeology. In: Understanding Leadership in Complex Systems. Understanding Complex Systems. Springer, Cham. https://doi.org/10.1007/978-3-319-40445-5_9
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