Praxeology and History
October 26, 2010 · Posted in General Economics
Some people assert that a shortcoming of praxeology is that it denies the relevance of empirical evidence. This assertion suffers from a misunderstanding of the purpose and scope of praxeology.
It is true that praxeology is fundamentally axiomatic, meaning it builds all its theories upon the irrefutable axiom that humans consciously aim at chosen objectives and employ chosen means in order to attain those objectives.
But that axiom in itself is of course empirical. It is derived from a simple observation of human action. It is, like any other proposition, derived from objective facts of observable reality. Someone must at some point have made that observation in order to formulate the axiom.
Just as logic is nothing but a derivative of the consistency of all reality, praxeology in particular is a derivative of the occurrence of human choice and action in reality. If reality wasn’t consistent, there would be no logic. If no purposefully acting and choosing beings existed in the universe, then praxeology would not exist.
What praxeology does say is that at the very least any proposition about human action naturally needs to be in complicance with irrefutable axioms about human action in order for it to be potentially valid. Praxeology has never claimed to be helpful in the process of gathering evidence for the actual occurence of an event. This is, in fact, the task of history and outside the scope of praxeology.
If a proposition can’t even pass that most basic test, there is no need to look for historical evidence in its support. This doesn’t mean that historical evidence is meaningless to the overall science of Human Action.
Nor is praxeology itself stubborn toward the evidence of history. If someone were to make a complete and isolated historical observation that contradicts praxeologically established concepts, then he is free to disprove the validity of the praxeological concept on logical grounds. But if he cannot do that, then there is something he is missing in his observation; maybe a variable or two, maybe the measurement was off, maybe his eyesight is skewed etc.
In the same way, if someone were to make an empirical mathematical observation, claiming that he put two red balls and two blue balls into a box, and then suddenly had 5 balls, would you be convinced that the mathematical concept of 2+2 = 4 is invalid? Isn’t it rather possible that there was already a 5th ball in the box, or that someone threw it in from somewhere else, or that the observer had a martini too many? And furthermore, if all these things are not the case, then all we would need is for the person to provide logically deductive proof that 2 + 2 = 4 is a false statement.
Mises was most definitely not ignorant to the evidence of history. I would even go so far as to saying that he is one of the greatest historians of the 20th century. He himself actually subdivided the science of Human Action into praxeology and (you guessed it) … history!
The purpose of history is the gathering of convincing and sufficient evidence to prove that certain events did in fact occur.
History says “The price of house X fell from 2007 through 2010.” while praxeology (or economics in particular) says “Ceteris paribus, the price of a good with rising supply and falling demand will fall.”
History is a helpful tool in finding evidence that further corroborates propositions that already conform with praxeological axioms. Historical evidence in support of any proposition regarding human action is necessary, not sufficient. History without praxeology would be nothing but the observation of seemingly random limb movements of fleshy/bony objects in space.
As it is with history, more than in any other science, social events are always immensely complex, unisolated, and almost impossible to reproduce without introducing new variables. Historical statistics and data can very easily be prepared and falsified to support one view or another.
Thus what Mises rejected was the method of historicism, that is solely gathering historical evidence in order to prove theorems that don’t even pass the very first hurdles of praxeology.
In short: History deals with specific instances of human action, while praxeology explains general, immutable, and irrefutable attributes of human action. The narrow concepts of history and praxeology are to human action what the broader concepts of empiricism and logic are to all of science, respectively.