Mises’s FlawedDeduction and Praxeology
http://socialdemocracy21stcentury.blogspot.com/2013/09/misess–flawed–deduction-and-praxeology.html

A breath-taking assertion is made by Mises in his book HumanAction about praxeology:

“The scope of praxeology is the explication of the category of human action. All that is needed for the deduction of all praxeological theorems is knowledge of the essence of human action. It is a knowledge that is our own because we are men; no being of human descent that pathological conditions have not reduced to a merely vegetative existence lacks it. No special experience is needed in order to comprehend these theorems, and no experience, however rich, could disclose them to a being who did not know a priori what human action is. The only way to a cognition of these theorems is logical analysis of our inherent knowledge of the category of action. We must bethink ourselves and reflect upon the structure of human action. Like logic and mathematics, praxeological knowledge is in us; it does not come from without.

All the concepts and theorems of praxeology are implied in the category of human action.” (Mises 2008: 64).

The problem with this, not to put too fine a point on it, is that it is all utter rubbish!

When we look carefully through the first few chapters of HumanAction, we will not detect any formal deduction going on, by which Mises’s inferences are carefully and painstakingly deduced from the human action axiom.

Even after inspecting Mises’s own informal method of “verbal deduction” does not help in identifying how inferences are formally “deduced” from the action axiom either (see Barrotta 1996: 61–65 for a similar critique).

First, the statement that all human action by non-mentally-ill human beings aims at ends and is, in this sense, purposeful is undoubtedly synthetic a posteriori, not synthetic a priori as I have shownhere. For Mises cannot even establish a clear definition and criteria for (1) what constitutes a non-mentally-ill human being or (2) what constitutes conscious human action in the first place, without recourse to a vast amount of empirical scientific evidence about human behaviour, medicine, psychology and biology.

Secondly, the statement

(1) all human action by non-mentally-ill human beings aims at ends and is, in this sense, purposeful

asserts only what it asserts and nothing else. Naturally, it implies things if by means of syllogisms we derive inferences, but even here what one derives will be trivial and already contained in the axiom.

It cannot be used to imply by deduction any other assertions unless a vastamountofadditionalempiricalknowledge and inductivearguments are used. To see this we need only ask: what kind of deductive axiomatic system can proceed withonlyoneaxiom?

Mises’s epistemological statement above fails, and we can look at his discussion of the notion of fundamental uncertainty to see an example of this:

“The uncertainty of the future is already implied in the very notion of action. That man acts and that the future is uncertain are by no means two independent matters. They are only two different modes of establishing one thing.

We may assume that the outcome of all events and changes is uniquely determined by eternal unchangeable laws governing becoming and development in the whole universe. We may consider the necessary connection and interdependence of all phenomena, i.e., their causal concatenation, as the fundamental and ultimate fact. We may entirely discard the notion of undetermined chance. But however that may be, or appear to the mind of a perfect intelligence, the fact remains that to acting man the future is hidden. If man knew the future, he would not have to choose and would not act. He would be like an automaton, reacting to stimuli without any will of his own. Some philosophers are prepared to explode the notion of man’s will as an illusion and self-deception because man must unwittingly behave according to the inevitable laws of causality. They may be right or wrong from the point of view of the prime mover or the cause of itself. However, from the human point of view action is the ultimate thing. We do not assert that man is ‘free’ in choosing and acting. We merely establish the fact that he chooses and acts and that we are at a loss to use the methods of the natural sciences for answering the question why he acts this way and not otherwise.

Natural science does not render the future predictable. It makes it possible to foretell the results to be obtained by definite actions. But it leaves unpredictable two spheres: that of insufficiently known natural phenomena and that of human acts of choice. Our ignorance with regard to these two spheres taints all human actions with uncertainty. Apodictic certainty is only within the orbit of the deductive system of aprioristic theory. The most that can be attained with regard to reality is probability.” (Mises 2008: 205).

In fact, that “all human action by non-mentally-ill human beings aims at ends” implies nothing necessary about uncertainty or the unknowability of the future.

It would be possible for beings fully aware of the consequences of all future action to still act with a purpose when they act. The action axiom by itself does not establish or imply anything necessary about the nature of the future or non-calculable probability.

Just to establish the existence of a world where humans face an uncertain future in the sense of (1) being unable to perfectly predict the future, and (2) being unable to provide objective probability scores for future outcomes or events in certain processes requires many inductive arguments and a great deal of empirical evidence.

Mises’s statement above already requires that he must use all the evidence of the natural sciences to distinguish systems where (1) deterministic forces can be scientifically identified and objective predictions made from (2) complex systems where stable long-run relative frequencies for outcomes do not exist.

In his attempts to distinguish (1) class probability from (2) case probability (Mises 2008: 107–115), Mises has tacitly relied on the vast empirical knowledge of the relative frequency theory of probability and the inability of this process to yield objective results in cases where long-run relative frequencies cannot be found (e.g., in many areas of the social and economic world).

In short, the very idea that “all praxeological theorems” can be produced by “deduction” from “the essence of human action” fails in the first few chapters of Human Action.

And an astute critic of Mises called George J. Schuller knew this soon after the book was published:

“Acceptance of Mises’ stated axioms does not necessarily imply acceptance of the ‘principles’ or ‘applications to reality’ which he has drawn from them even though his logic may be impeccable. When a logical chain grows beyond the limits set by stated assumptions, it uses unstated assumptions. The number of unstated assumptions (axioms, postulates, or other) in Human Action is enormous. If Mises denies this, let him try to rewrite his book as a set of numbered axioms, postulates, and syllogistic inferences using, say, Russell’s Principia” (Schuller 1951: 188).

BIBLIOGRAPHY
Barrotta, P. L. 1996. “A Neo-Kantian Critique of von Mises’s Epistemology,” Economics and Philosophy 12: 51–66.

Mises, L. von. 2008. Human Action: A Treatise on Economics. The Scholar’s Edition. Mises Institute, Auburn, Ala.

Schuller, G. J. 1951. “Mises’ ‘Human Action’: Rejoinder,” American Economic Review 41.1: 185–190.

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