The Economics of Ignorance and Coordination

The Economics of Ignorance and Coordination

Subjectivism and the Austrian School of Economics

New Thinking in Political Economy series

Thierry Aimar

This book clarifies the specific nature of the Austrian theory and restores the unity and open-mindedness of the Austrian school in general. The intention is not to offer a collection of different or parallel ideas, but rather to retrace, from a pedagogical and constructive perspective, the various stages of the construction of a well-founded theoretical edifice: from Ludwig von Mises to Murray Rothbard, from Friedrich Hayek to Israel M. Kirzner and from Lachmann to Lavoie. The book is a reconstitution of the way Austrian ideas and concepts organize themselves in a common structure.

Chapter 2: Praxeology, Axiomatic System of Economics

Thierry Aimar

Subjects: economics and finance, austrian economics


___________________________________________________ Mises’ thought was that deductive reasoning in the social spheres leads back to the concept of action. It being the first link in the chain of knowledge, action is the very axiom which supports the entire construction of economic theory. Praxeology is the definition of a grammar of human action; 1 it must supply us with apodictic knowledge of the structuring elements of human action. Praxeology ‘is not concerned with the changing content of acting, but with its pure form and its categorial structure’ (Mises, 1966, p. 47). It does not deal in vague terms with human action in general, but with concrete action which a definite man has performed at a definite date and at a definite place. But of course, it does not concern itself with the accidental and environmental features of this action and with what distinguishes it from all other actions, but only with what is necessary and universal in its performance (ibid., p. 44). This knowledge is acquired in an a priori way, built out of introspection. ‘Like logic and mathematics, praxeological knowledge is in us; it does not come from without’ (ibid., p. 64). From this perspective, praxeology’s teachings ‘are not subject to verification or falsification on the ground of experience and facts. They are both logically and temporally antecedent to any comprehension of historical facts’ and also ‘Its statements and propositions are not derived from experience’ (ibid., p. 32). Praxeology in fact expresses the ultimate given: action; and also forms theorems growing from...

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