1. Origin in the Historical and Normative Sciences

It is in accounts of history that we find the earliest beginnings of knowledge in the sciences of human action. An epistemology that is today rejected required of the historian that he approach his subject matter without theory and simply depict the past as it was. He has to describe and portray past reality, and, it was said, he will best succeed in doing this if he views events and the sources of information about them with the least possible amount of prejudice and presupposition.

Not until very late was it realized that the historian cannot duplicate or reproduce the past; on the contrary, he interprets and recasts it, and this requires that he make use of some ideas that he must have already had before setting about his work.1  Even if, in the course of his work, the treatment of his material leads him to new ideas, concepts are always logically prior to the understanding of the individual, the unique, and the non-repeatable. It is impossible to speak of war and peace unless one has a definite conception of war and peace before one turns to the historical sources. Nor can one speak of causes and effects in the individual case unless one possesses a theory that treats certain connections between cause and effect as having a universal range of applicability. The reason why we accept the sentence, “The king defeated the rebels and therefore remained in power,” but are not satisfied with the logically contradictory sentence, “The king defeated the rebels and therefore fell from power,” is that the first conforms to our theories about the results of military victory, while the latter contradicts them.

The study of history always presupposes a measure of universally valid knowledge. This knowledge, which constitutes the conceptual tool of the historian, may sometimes seem platitudinous to one who considers it only superficially. But closer examination will more often reveal that it is the necessary consequence of a system of thought that embraces all human action and all social phenomena. For example, in using an expression such as “land hunger,” “lack of land,” or the like, one makes implicit reference to a theory that, if consistently thought through to its conclusion, leads to the law of diminishing returns, or in more general terms, the law of returns. For if this law did not hold, the farmer who wanted to obtain a greater net yield would not require more land; by means of an increased expenditure of labor and capital goods he would be able to obtain from even the smallest piece of tillage the same result he wanted to achieve by increasing the amount of acreage at his disposal. The size of the area available for cultivation would then be a matter of indifference to him.

However, it is not only in history and in the other sciences that make use of the conceptual tools of historical investigation that we find universally valid statements about human action. Such knowledge also constitutes the foundation of the normative sciences?ethics, the philosophy of law, and systematic jurisprudence. The primary task of political philosophy, the philosophy of law, and political science is the attainment of universally valid knowledge of social phenomena. If they have failed in this endeavor, the reason is to be sought not only in the fact that they often strayed from their goal and aimed at others, and?like the philosophy of history?instead of seeking the universally valid in the vicissitudes of particular events, began to search for the objective meaning of things. The determining factor in their failure was that from the very outset they made use of a scientifically unfruitful method: they began not with the individual and his action, but with attempts to view the totality. What they wanted to discover was not the regularity prevailing in the action of men, but the whole course of mankind’s progression from its origin to the end of all things.

Psychology, in turning to the individual, found the right starting point. However, its path necessarily leads in another direction than that of the science of human action. The subject matter of the latter is action and what follows from action, whereas the subject matter of psychology is the psychic events that result in action. Economics begins at the point at which psychology leaves off.

2. Economics

The scattered and fragmentary insights of the historical and normative sciences themselves achieved scientific status only with the development of economics in the eighteenth century. When men realized that the phenomena of the market conform to laws, they began to develop catallactics and the theory of exchange, which constitutes the heart of economics. After the theory of the division of labor was elaborated, Ricardo’s law of association enabled men to grasp its nature and significance, and thereby the nature and significance of the formation of society.

The development of economics and rationalistic sociology from Cantillon and Hume to Bentham and Ricardo did more to transform human thinking than any other scientific theory before or since. Up to that time it had been believed that no bounds other than those drawn by the laws of nature circumscribed the path of acting man. It was not known that there is still something more that sets a limit to political power beyond which it cannot go. Now it was learned that in the social realm too there is something operative which power and force are unable to alter and to which they must adjust themselves if they hope to achieve success, in precisely the same way as they must take into account the laws of nature.

This realization had enormous significance for men’s action. It led to the program and policies of liberalism and thus unleashed human powers that, under capitalism, have transformed the world. Yet it was precisely the practical significance of the theories of the new science that was responsible for its undoing. Whoever wished to combat liberal economic policy was compelled to challenge the character of economics as a science. Enemies arose against it for political reasons.

The historian must never forget that the most momentous occurrence in the history of the last hundred years, the attack launched against the universally valid science of human action and its hitherto best developed branch, economics, was motivated from the very beginning not by scientific ideas, but by political considerations. However, the science of human action itself is not concerned with these political backgrounds, but with the arguments with which it has been confronted. For it has also been confronted with arguments and attacked by objective reasoning. Its nature remained problematical as long as no one succeeded in achieving clarity about the question what this science really is and what character its propositions have.

3. The Program of Sociology and the Quest for Historical Laws

Concurrently with the achievements that stemmed from the foundation of the science of human action came grandiloquent programmatic declarations that demanded a science of social phenomena. The discoveries made by Hume, Smith, Ricardo, Bentham, and many others may be regarded as constituting the historical beginning and foundation of a truly scientific knowledge of society. The term “sociology,” however, was coined by August Comte, who, for the rest, in no way contributed to social science. A great number of authors with him and after him called for a science of society, most of them without appreciating what had already been done toward founding it and without being able to specify how one would go about achieving it. Many lost themselves in empty trivialities, the most frightful example of which may be considered the attempt to conceive of society as a biological organism. Others concocted an ostensible science to justify their political schemes. Still others, for example Comte himself, added new constructions to the philosophy of history and called the result sociology.

These prophets of a new epoch, who professed to have developed for the first time a science of the social realm, not only failed in this domain, which they had declared to be the proper field of their activity, but unhesitatingly set out to destroy history and all the sciences that make use of the historical method. Prepossessed by the idea that Newtonian mechanics constitutes the model for all the genuine sciences, they demanded of history that it at last begin to raise itself to the status of an exact science through the construction of “historical laws.”

Windelband, Rickert, and their school opposed these demands and brought into clear relief the special and peculiar characteristics of historical investigation. Nevertheless, their arguments are weakened by their failure to conceive of the possibility of universally valid knowledge in the sphere of human action. In their view the domain of social science comprises only history and the historical method .2  They regarded the findings of economics and historical investigation in the same light as the Historical School. Thus, they remained bound to historicism. Moreover, they did not see that an intellectual outlook corresponding to the empiricism that they had attacked in the field of the sciences of human action often went hand in hand with historicism.

4. The Standpoint of Historicism

In the view of historicism the field of the science of human action is constituted only by history and the historical method. Historicism maintains that it is a waste of effort to search after universally valid regularities that would be independent of time, place, race, nationality, and culture. All that sociology and economics can tell us is the experience of a historical event, which can be invalidated by new experience. What was yesterday can be otherwise tomorrow. All scientific knowledge in the social realm is derived from experience; it is a generalization drawn from past experience that can always be upset by some later experience. Therefore, the only appropriate method of the social sciences is the specific understanding of the historically unique. There is no knowledge whose validity extends beyond a definite historical epoch or at most beyond several historical epochs.

It is impossible to think this view through consistently to its conclusion. If one attempts to do so, one must sooner or later reach a point at which one is forced to admit that there is something in our knowledge that comes before experience, something whose validity is independent of time and place. Even Sombart, who is today the most outspoken representative of the view that economics must make use of the method of understanding, is compelled to acknowledge that also in the “field of culture, and in particular of human society, there is such a thing as logically necessary relationships.” He believes that “they constitute what we call the mind’s conformity to law; and we call these principles, deduced a priori, laws.”3  Thus, unintentionally and unawares, Sombart has admitted all that is required to prove the necessity of a universally valid science of human action fundamentally different from the historical sciences of human action. If there are such principles and laws at all, then there must also be a science of them; and this science must be logically prior to every other treatment of these problems. It will not do simply to accept these principles as they are conceived in daily life. It is absurd to want to forbid science to enter a field and to demand tolerance for received misconceptions and unclear, contradictory ideas. Nor is Sombart able to offer anything more than a few sarcastic remarks in support of his disapproval of any attempt to treat economics as a universally valid theory. He thinks it is “occasionally very amusing to observe how an empty trifle lying concealed behind a great show of words makes its appearance in all its pitiful meagerness and almost arouses our scorn.”4  This is, of course, a quite inadequate attempt to defend the procedure adopted by Sombart and other supporters of historicism. If, as Sombart expressly admits, there are “fundamental economic concepts . . . that are universally valid for all economic action,”5  then science may not be prevented from concerning itself with them.

Sombart admits still more. He states explicitly that “all theory is ‘pure,’ that is, independent of time and space.”6  Thus he takes issue with Knies, who opposed the “absolutism of theory,” i.e., its “pretension to set forth propositions in the scientific treatment of political economy that are unconditional and equally valid for all times, countries, and nationalities.”7

Perhaps it will be objected that it is belaboring the obvious to insist that economics provides us with universally valid knowledge. Unfortunately, such a reproach would have no justification; in the eyes of many people it is not obvious. Whoever has undertaken to present the teachings of historicism in a coherent form has generally been unable to avoid revealing, at some point in the process, the impossibility of systematically developing the doctrine. However, the importance of historicism does not lie in the entirely abortive attempts that have been made to treat it as a coherent theory. Historicism by its very nature is not a system, but the rejection and denial in principle of the possibility of constructing a system. It exists and operates not within the structure of a complete system of thought, but in critical aperçus, in the propaganda of economic and socio-political programs, and between the lines of historical, descriptive, and statistical studies. The politics and the science of the last decades have been completely dominated by the views of historicism and empiricism. When it is recalled that an author who, during his lifetime, stood in the highest regard in the German-speaking countries as a theorist of “the economic aspects of political science,” explained the necessity to economize as a specific feature of production in a money economy,8  one will certainly appreciate the need of emphasizing the untenability of historicism before embarking upon the task of setting forth the logical character of the science of human action.

5. The Standpoint of Empiricism

It is indisputable that there is and must be an aprioristic theory of human action. And it is equally indisputable that human action can be the subject matter of historical investigation. The protest of the consistent representatives of historicism, who do not want to admit the possibility of a theory that would be independent of time and place, need disturb us no more than the contention of naturalism, which wants to challenge the scientific character of history so long as it has not reached the point where it can establish historical laws.

Naturalism presupposes that empirical laws could be derived a posteriori from the study of historical data. Sometimes it is assumed that these laws are valid without respect to time or place, sometimes that they have validity only for certain periods, countries, races, or nationalities.9  The overwhelming majority of historians reject both varieties of this doctrine. Indeed, it is generally rejected even by those who are in accord with historicism and who do not want to admit that, without the aid of the aprioristic theory of human action, the historian would be completely at a loss to deal with his material and would be unable to solve any of his problems. Such historians generally maintain that they are able to carry on their work completely free of theory.

We need not enter here into the investigation of whether historicism must lead necessarily to the one or to the other of these two views. Whoever is of the opinion that the doctrine of historicism cannot be consistently thought through to its conclusion will consider it futile to undertake such an investigation. The only point worth noting is that a sharp opposition exists between the view of the adherents of the Historical School and that of the majority of historians. Whereas the former believe that they can discover empirical laws from the data of history and want to call the compilation of such laws sociology and economics, most historians would not be willing to agree that this can be done.

The thesis of those who affirm the possibility of deriving empirical laws from historical data we shall call empiricism. Historicism and empiricism are, consequently, not the same thing, As a rule, though certainly not always, if they take any position on the problem at all, historians profess their adherence to historicism. With few exceptions (Buckle, for example) they are opponents of empiricism. The adherents of the Historical and the Institutionalist Schools take the point of view of historicism, although they find it impossible to maintain this doctrine in its purity as soon as they attempt to state it in a logically and epistemologically coherent manner; they are almost always in accord with empiricism. Thus, a sharp contrast of view generally exists between the historians and the economists and sociologists of the Historical School.

The question with which we are now concerned is no longer whether a prevailing regularity can be discovered in human action, but whether the observation of facts without any reference to a system of aprioristic knowledge of human action can be considered a method capable of leading us to the cognition of such a regularity. Can economic history furnish “building stones” for an economic theory, as Schmoller maintains?10  Can the “findings of economic history’s specialized description become elements of theory and lead to universal truths”? In this connection we shall not take up the question of the possibility of universal “historical laws” (which would therefore not be economic laws) that has often been exhaustively discussed.11  We shall limit ourselves to examining whether, by means of the observation of facts, that is, by an a posteriori method, we could arrive at statements of the kind sought for by the system of economic theory.

The method used by the natural sciences for the discovery of the laws of phenomena begins with observation. However, the decisive step is taken only with the construction of an hypothesis: a proposition does not simply emerge from observation and experience, for these always present us only with complex phenomena in which various factors appear so closely connected that we are unable to determine what role should be attributed to each. The hypothesis is already an intellectual elaboration of experience, above all in its claim to universal validity, which is its decisive characteristic. The experience that has led to the construction of the proposition is always limited to the past; it is always an experience of a phenomenon that occurred in a particular place and at a particular time. However, the universal validity claimed for the proposition also implies applicability to all other past and future occurrences. It is based on an imperfect induction. (No universal theorems emerge from perfect induction, but only descriptions of an event that occurred in the past.)

Hypotheses must be continually verified anew by experience. In an experiment they can generally be subjected to a particular method of examination. Various hypotheses are linked together into a system, and everything is deduced that must logically follow from them. Then experiments are performed again and again to verify the hypotheses in question. One tests whether new experience conforms to the expectations required by the hypotheses. Two assumptions are necessary for these methods of verification: the possibility of controlling the conditions of the experiment, and the existence of experimentally discoverable constant relations whose magnitudes admit of numerical determination. If we wish to call a proposition of empirical science true (with whatever degree of certainty or probability an empirically derived proposition can have) when a change of the relevant conditions in all observed cases leads to the results we have been led to expect, then we may say that we possess the means of testing the truth of such propositions.

With regard to historical experience, however, we find ourselves in an entirely different situation. Here we lack the possibility not only of performing a controlled experiment in order to observe the individual determinants of a change, but also of discovering numerical constants. We can observe and experience historical change only as the result of the combined action of a countless number of individual causes that we are unable to distinguish according to their magnitudes. We never find fixed relationships that are open to numerical calculation. The long cherished assumption that a proportional relationship, which could be expressed in an equation, exists between prices and the quantity of money has proved fallacious; and as a result the doctrine that knowledge of human action can be formulated in quantitative terms has lost its only support.

Whoever wants to derive laws of human action from experience would have to be able to show how given situations influence action quantitatively and qualitatively. It is psychology that generally has sought to provide such a demonstration, and for that reason all those who assign this task to sociology and economics are prone to recommend to them the psychological method. What is more, by the psychological method they understand not what was called psychological—in a rather inappropriate and even misleading sense—in the method of the Austrian School, but rather the procedures and discoveries of scientific psychology itself.

However, psychology has failed in this sphere. With the use of its methods it can, of course, observe unconscious reactions to stimuli in the manner of the biological sciences. Beyond this it can accomplish nothing that could lead to the discovery of empirical laws. It can determine how definite men have behaved in definite situations in the past, and it infers from its findings that conduct will be similar in the future if similar men are placed in a similar situation. It can tell us how English school boys behaved in the last decades when confronted with a definite situation, for example, when they encountered a crippled beggar. Such information tells us very little about the conduct of English school children in the coming decades or about the conduct of French or German school children. Psychology can establish nothing more than the occurrence of an historical incident: the cases observed have shown such and such; but the conclusions drawn from the observed cases, which refer to English school children of a definite period, are not logically justified when applied to other cases of the same historical and ethnological character that have not been observed.

All that observation teaches us is that the same situation has a different effect on different men. The attempt to arrange men in classes whose members all react in the same way has not been successful because even the same men react differently at different times, and there is no means of ascribing unequivocally definite modes of reaction to different ages or other objectively distinguishable periods or conditions of life. Consequently, there is no hope of achieving knowledge of a regularity in the phenomena by this method. This is what one has in mind when one speaks of free will, of the irrationality of what is human, spiritual, or historical, of individuality in history, and of the impossibility of rationally comprehending life in its fullness and diversity. One expresses the same idea in pointing out that it is not possible for us to grasp how the action of the external world influences our minds, our will, and, consequently, our action. It follows from this that psychology, in so far as it deals with such things, is history or, in the terminology of current German philosophy, a moral science.

Whoever declares that the method of historical understanding used by the moral sciences is appropriate also for economics should be aware of the fact that this method can never lead to the discovery of empirical laws. Understanding is precisely the method that the historical sciences (in the broadest sense of the term) employ in dealing with the unique, the non-repeatable, that is, in treating what is simply historical. Understanding is the mental grasp of something that we are unable to bring under rules and explain through them.12  This is true not only of the field traditionally designated as that of universal history, but also of all special fields, above all that of economic history. The position taken by the empiricist school of German economics in the struggle against economic theory is untenable also from the standpoint of the logic of the historical sciences as developed by Dilthey, Windelband, Rickert, and Max Weber.

In the empirical sciences the controlled experiment is indispensable for the a posteriori derivation of propositions whenever experience presents only complex phenomena in which the effect is produced by several interlinked causes. In historical experience we can observe only complex phenomena, and an experiment is inapplicable to such a situation. Sometimes it is said that a mental experiment (Gedankenexperiment) could take its place. However, a mental experiment, logically considered, has an entirely different meaning from a real experiment. It involves thinking through the implications of a proposition in the light of its compatibility with other propositions that we accept as true. If these other propositions are not derived from experience, then the mental experiment makes no reference to experience.

6. The Logical Character of the Universally Valid Science of Human Action

The science of human action that strives for universally valid knowledge is the theoretical system whose hitherto best elaborated branch is economics, In all of its branches this science is a priori, not empirical. Like logic and mathematics, it is not derived from experience; it is prior to experience. It is, as it were, the logic of action and deed.13

Human thought serves human life and action. It is not absolute thought, but the forethought directed toward projected acts and the afterthought that reflects upon acts done. Hence, in the last analysis, logic and the universally valid science of human action are one and the same. If we separate them, so as to contrast logic and practice, we must show at what point their paths diverge and where the special province of the science of action is to be found.

One of the tasks with which thought must cope in order to fulfill its function is that of comprehending the conditions under which human action takes place. To treat these in their concrete detail is the work of the natural sciences and, in a certain sense, also of history and the other historical sciences. Our science, on the other hand, disregarding the accidental, considers only the essential. Its goal is the comprehension of the universal, and its procedure is formal and axiomatic. It views action and the conditions under which action takes place not in their concrete form, as we encounter them in everyday life, nor in their actual setting, as we view them in each of the sciences of nature and of history, but as formal constructions that enable us to grasp the patterns of human action in their purity.

Only experience makes it possible for us to know the particular conditions of action in their concrete form. Only experience can teach us that there are lions and microbes and that their existence can present definite problems to acting man; and it would be absurd, without experience, to indulge in speculations about the existence or nonexistence of some legendary beast. The existence of the external world is given through experience; and if we pursue definite plans, only experience can teach us how we must act vis-?-vis the external world in concrete situations.

However, what we know about our action under given conditions is derived not from experience, but from reason. What we know about the fundamental categories of action?action, economizing, preferring, the relationship of means and ends, and everything else that, together with these, constitutes the system of human action?is not derived from experience. We conceive all this from within, just as we conceive logical and mathematical truths, a priori, without reference to any experience. Nor could experience ever lead anyone to the knowledge of these things if he did not comprehend them from within himself.

As an a priori category the principle of action is on a par with the principle of causality. It is present in all knowledge of any conduct that goes beyond an unconscious reaction. “In the beginning was the deed.” In our view the concept of man is, above all else, also the concept of the being who acts. Our consciousness is that of an ego which is capable of acting and does act. The fact that our deeds are intentional makes them actions. Our thinking about men and their conduct, and our conduct toward men and toward our surroundings in general, presuppose the category of action.

Nevertheless, we are quite incapable of thinking of this fundamental category and the system deduced from it without also thinking, at the same time, of the universal prerequisites of human action. For example, we are unable to grasp the concept of economic action and of economy without implying in our thought the concept of economic quantity relations and the concept of an economic good. Only experience can teach us whether or not these concepts are applicable to anything in the conditions under which our life must actually be lived. Only experience tells us that not all things in the external world are free goods. However, it is not experience, but reason, which is prior to experience, that tells us what is a free and what is an economic good.

Consequently, it would be possible to construct, by the use of the axiomatic method, a universal praxeology so general that its system would embrace not only all the patterns of action in the world that we actually encounter, but also patterns of action in worlds whose conditions are purely imaginary and do not correspond to any experience. A theory of money would still be meaningful even if throughout history there had never been any indirect exchange. That such a theory would have no practical importance in a world that did not use money would in no way detract from the truth of its statements. Because we study science for the sake of real life?and, it should be remembered, the desire for pure knowledge for its own sake is also a part of life?and not as a form of mental gymnastics, we generally do not mind forgoing the gratification that could be offered by a perfect, comprehensive system of the axioms of human action, a system so universal that it would comprise all thinkable categories of the conditions of action. Instead, we are satisfied with the less universal system that refers to the conditions given in the world of experience.

Nevertheless, this reference to experience in no way changes the aprioristic character of our knowledge. In this connection, experience is of absolutely no concern to our thinking. All that we owe to experience is the demarcation of those problems that we consider with interest from problems that we wish to leave aside because they are uninteresting from the point of view of our desire for knowledge. Hence, experience by no means always refers to the existence or nonexistence of the conditions of action, but often only to the presence of an interest in the treatment of a problem. In experience there is no socialist community; nevertheless, the investigation of the economy of such a community is a problem that in our age arouses the greatest of interest.

A theory of action could conceivably be constructed on the assumption that men lacked the possibility of understanding one another by means of symbols, or on the assumption that men—immortal and eternally young—were indifferent in every respect to the passage of time and therefore did not consider it in their action. The axioms of the theory could conceivably be framed in such universal terms as to embrace these and all other possibilities; and it would be conceivable to draw up a formal praxeological system patterned after the science of logic or the science built upon the axioms of, for example, Hilbertian geometry.14  We forgo these possibilities because conditions that do not correspond to those we encounter in our action interest us only in so far as thinking through their implications in imaginary constructions enables us to further our knowledge of action under given conditions.

The method actually employed by economists in the treatment of their problems can be seen with particular clarity in the case of the problem of imputation. Conceivably it would be possible to formulate the theory of the appraisement and pricing of the factors of production (goods of higher order, producers’ goods) in the broadest generality so that, for one thing, we would work only with an unqualified concept, viz., means of production. We could then elaborate the theory in such a way that the three factors of production that are enumerated in the customary presentation would appear as special cases. But we proceed differently. We do not bother to furnish a universal imputation theory of the means of production as such, but proceed immediately to the treatment of the three categories of means of production: land, labor, and capital. This practice is altogether warranted by the object of our investigation, of which we must never lose sight.

However, the renunciation of axiomatic universality and precision also conceals many dangers, and it has not always been possible to avoid them. It is not only the Marxist theory of classes15  that has failed to grasp the categorial character of each of these specific groups of factors of production. To be sure, it was noted that the peculiarity of land as a factor of production lies in the difference in the usefulness of individual pieces of land from the point of view of the goals of action; the theory of ground rent never lost sight of the fact that land is appraised differently according to its quality and location. However, the theory of wages did overlook the fact that labor too is of different quality and intensity and that on the market there is never a supply of or a demand for “labor” as such, but only a supply of and a demand for labor of a definite kind. Even after this fact was recognized, an attempt was made to evade its consequences by assuming that what forms the bulk of the supply and is chiefly in demand is unskilled labor and that it is permissible to ignore, as quantitatively negligible, skilled, “higher” labor. The theory of wages would have been spared many errors had it been kept in mind what function the special treatment of labor in the theory of distribution is called upon to fulfill and at what point it becomes necessary to speak no longer simply of labor, but of labor of a definite quality that is offered or sought at a given time in a given place. It was still more difficult for the theory of capital to free itself of the idea of abstract capital, where the categorial difference between land, labor, and capital is no longer in question, but where the appraisement of definite capital goods, supplied or demanded in a definite place at a definite time, is to be considered. Likewise in the theory of distribution and in the theory of imputation, it was not easy to shake off the influence of the universalist view.16

Our science deals with the forms and patterns of action under the various categories of its conditions. In pointing this out we are not drafting a plan for a future science. We do not maintain that the science of human action should be made aprioristic, but that it is so already. We do not want to discover a new method, but only to characterize correctly the method that is actually used. The theorems of economics are derived not from the observation of facts, but through deduction from the fundamental category of action, which has been expressed sometimes as the economic principle (i.e., the necessity to economize), sometimes as the value principle or as the cost principle. They are of aprioristic derivation and therefore lay claim to the apodictic certainty that belongs to basic principles so derived.

7. Sociology and Economics: Some Comments on the History of Economic Thought

It is in sociology and above all in economics that we encounter the universally valid science of human action. Whatever has hitherto been accomplished in this science is to be considered either sociology or economics in the traditional sense. Names are conventional designations that in no way can directly—that is, without reference to an existing terminolop—express the essence of what is designated, as a still widespread view demands. Consequently, there is no point in examining the appropriateness of the terms “economics” (theory of the economy) and “sociology” (theory of society) as names for the universally valid science of human action. Inherited from the past, they have accompanied the science on its way to the development of a completely comprehensive theoretical system. That is why these terms, in accordance with the way in which words are coined, refer to the historical starting point of the investigation and not to the logical foundation of the developed theory or to the central idea of the theory itself. Unfortunately, this fact has not always been appreciated, and repeated attempts have been made to define and comprehend the scope and task of the science on the basis of nomenclature. In the spirit of a crude form of conceptual realism, society was designated as the subject matter assigned to sociology, and the economy, or the economic aspect of culture, as the theme of economics. And then no pains were spared in the attempt to ascertain what, after all, society and the economy really are.

If today we may take the view that the subject of our science is human action, without fear of thereby arousing more hostility than that which every scientific theory encounters, it is because of the work of several generations of scholars. The investigations of such completely different thinkers as Cairnes, Bagehot, Menger, Max Weber, and Robbins show that they are all guided by this idea. In view of the history of science it is understandable that the claim of economics to be aprioristic and not empirical may still give rise to opposition because the existing literature has only slightly prepared the way for it. The two hundred years in which the development of our science has taken place have not been favorable to the acknowledgment of a new field of aprioristic knowledge. The successes achieved by the use of the empirical methods of the natural sciences and by the careful investigation of sources on the part of the historical sciences have attracted so much attention that no notice was taken of the advances that the aprioristic sciences were making at the same time, although without them the progress made by empiricism would not have been possible. An age that wanted to deny the aprioristic character even of logic was certainly not prepared for the recognition of the aprioristic character of praxeology.

A glance at the theories of Senior, John Stuart Mill, Cairnes, and Wieser will show that, in spite of different terminologies and divergent views of the logical character of economics and of its place among the sciences, the conception of it as an aprioristic discipline was not, in fact, very far from the position taken not only by the economists who adhered to the views of the classical school, but also by the authors of the subjective theory of value. However, in this connection, one should be careful not to draw too sweeping conclusions from their statements, in view of the profound changes that have taken place since then in the conception of the fundamental logical and methodological questions and, correspondingly, also in the terminology of the literature devoted to their treatment.

According to Senior, there is no doubt that the science of economics “depends more on reasoning than observation.”12  Concerning the method of the economist he states:

His premises consist of a few general propositions, the result of observation, or consciousness, and scarcely requiring proof, or even formal statement, which almost every man, as soon as he hears them, admits, as familiar to his thoughts, or at least as included in his previous knowledge.18

Here both the observation of the external world and self-consciousness are mentioned as the sources of our knowledge. However, it is said that these propositions, which originate from within, either are immediately evident or follow necessarily from immediately evident propositions. Consequently, they are of aprioristic derivation and are not dependent upon experience, unless one wishes to call aprioristic cognition inner experience.

John Stuart Mill recognizes only empirical science and rejects in principle “a supposed mode of philosophizing, which does not profess to be founded upon experience at all.” He distinguishes two methods of scientific thought: the method a posteriori, “which requires, as the basis of its conclusions, not experience merely, but specific experience,” and the method a priori, by which he understands “reasoning from an assumed hypothesis.” In addition, he says of the latter method that it is “not a practice confined to mathematics, but is of the essence of all science which admits of general reasoning at all.” Political economy is to be characterized “as essentially an abstract science, and its method as the method a priori.”19

It would lead us far from our subject to point out and examine what separates us today from Mill’s conception of the a priori and of economics. In his view, even axioms are “but a class, the most universal class, of inductions from experience’ ‘; indeed, logic and mathematics are empirical sciences.20  just as geometry “presupposcs an arbitrary definition of a line: that which has length, but not breadth,” so “does political economy presuppose an arbitrary definition of man, as a being who invariably does that by which he may obtain the greatest amount of necessaries, conveniences and luxuries, with the smallest quantity of labor and physical self-denial with which they can be obtained in the existing state of knowledge.”21  Here the only important thing for us to note is that Mill places logic, mathematics, and the “moral sciences” in the category of disciplines for which the appropriate method is the “method a priori.” For the “moral sciences” this is “the only method,” since the impossibility of performing experiments precludes the “method a posteriori.”22

Even the contrast that Caimes drew between the inductive and the deductive methods does not correspond to the distinction that we make between empiricism and apriorism. His terminology was that of the philosophy of his age, which was completely under the influence of empiricism and psychologism. When Cairnes proceeds to answer the question whether economics is to be studied according to the deductive method or?as is generally assumed?according to the inductive method, and concludes by ascribing principal importance to the former, he employs a terminology that is so far removed from that of modern logic and epistemology that it would require intensive analysis to translate the meaning of his words into language familiar to the contemporary reader. But his actual reasoning, even though formulated in different terms, is closer to our own conception than would appear at first sight. Cairnes points out that the position of the natural scientist and that of the economist in relation to the subject matter of their investigations are entirely different. There is no other method available to the natural scientist than that of inductive?we would say: empirical?investigation, for “mankind have no direct knowledge of ultimate physical principles.”23  It is otherwise in the case of the economist. “The economist starts with a knowledge of ultimate causes.”24  We have at our disposal “direct knowledge . . . of causes in our consciousness of what passes in our own minds, and in the information which our senses convey, or at least are capable of conveying, to us of external facts.”25  Thus, the economist is “at the outset of his researches . . . already in possession of those ultimate principles governing the phenomena which form the subject of his study.”26

Even more obviously than Cairnes, Wieser tends toward the view that economics is an aprioristic science. He failed to Teach this conclusion only because the prevailing epistemological theories barred the way.27  The function of economic theory, according to Wieser, consists in “scientifically explicating and developing the content of common economic experience.” The consciousness of every economically active human being, he continues, provides him with

a fund of experiences that are the common possession of all who practice economy. These are experiences that every theorist already finds within himself without first having to resort to special scientific procedures. They are experiences concerning facts of the external world, as for instance, the existence of goods and their orders; experiences concerning facts of an internal character, such as the existence of human needs, and concerning the consequences of this fact; and experiences concerning the origin and course of economic action on the part of most men.

The scope of economic theory extends

exactly as far as common experience. The task of the theorist always ends where common experience ends and where science must collect its observations by historical or statistical investigation or by whatever other means may be deemed reliable.28

It is clear that what Wieser calls “common experience,” in contradistinction to the other kind, is not the experience with which the empirical sciences are concerned. The method of economics, which Wieser himself calls the psychological method, but which at the same time he also sharply distinguishes from psychology, consists, he says, in “looking outward from within the consciousness,” while the natural scientist (and therefore empirical science) observes the facts “only from without.” Wieser sees the cardinal error of Schumpeter precisely in his belief that the method of the natural sciences is suitable also for economic theory. Economics, Wieser maintains, finds “that certain acts are performed in the consciousness with the feeling of necessity.” Why, then, “should it first go to the trouble of deriving a law from a long chain of induction when everyone clearly hears the voice of the law within himself?”29

What Wieser calls “common experience” is to be sharply distinguished from experience acquired “through observations collected in the manner of historical or statistical studies.” Clearly, this is not experience in the sense of the empirical sciences, but the very opposite: it is that which logically precedes experience and is, indeed, a condition and presupposition of every experience. When Wieser seeks to mark off economic theory from the historical, descriptive, and statistical treatment of economic problems, he enters upon a path that must lead, if one follows it consistently, to the recognition of the aprioristic character of economic theory. Of course, it should occasion no surprise that Wieser himself did not draw this conclusion. He was unable to rid himself of the influence of Mill’s psychologistic epistemology, which ascribed an empirical character even to the laws of thought.30

• 1Cf. Rickert, Kulturwissenschaft und Naturwissenschaft (3rd ed.; Tübingen, 1915), pp. 28 ff.
• 2Cf. below p. 74.
• 3Sombart, Die drei Nationalökonomien (Munich and Leipzig, 1930), p. 253.
• 4Ibid.
• 5Sombart, op. cit., p. 247.
• 6Sombart, op. cit., p. 298.
• 7Knies, Die politische Okonomie vom geschichtlichen Standpunkte (Braunschweig, 1883), p. 24.
• 8Cf. Lexis, Allgemeine Volkswirtschaftslehre (3rd ed.; Berlin and Leipzig, 1926), p. 14.
• 9For a critique of this second point of view, cf. below pp. 25 ff. and pp. 119 ff.
• 10Schmoller, “Volkswirtschaft, Volkswirtschaftslehre und Methode,” Handwörterbuch der Staatswissenschaften (3rd ed.), VIII, 464.
• 11Concerning historical laws, cf. below pp. 109 ff.
• 12a12bCf. below pp. 130 ff.
• 13Several great economists were at the same time great logicians: Hume, Whately, John Stuart Mill, and Stanley Jevons.
• 14Cf. Eugen Slutsky, “Ein Beitrag zur formal-praxeologischen Grundlegung der Ökonomik,” Annales de la classe des sciences sociales-économiques (Kiev: Académie Oukraïenne des Sciences, 1926), IV.
• 15On this point cf. my Socialism, trans. by J. Kahane (new ed.; New Haven, 1951), pp. 331 f.
• 16On the universalist view cf. below pp. 153 f. For a special application of the reasoning outlined in the text to the theory of capital, cf. below pp. 217 ff.
• 18Ibid., p. 3.
• 19John Stuart Mill, Essays on Some Unsettled Questions of Political Economy (3rd ed.; London, 1877), p. 143.
• 20John Stuart Mill, System of Logic Ratiocinative and Inductive (8th ed.; London, 1872), 1, 290 ff.
• 21John Stuart Mill, op. cit., p. 144
• 22John Stuart Mill, op. cit., pp. 146 ff.
• 23Cairnes, The Character and Logical Method of Political Economy (3rd ed.; London, 1888), p. 83.
• 24Ibid., p. 87.
• 25Ibid., p. 88.
• 26Ibid., pp. 89 ff.
• 27Menger’s pioneering investigations are still further weakened by their dependence on Mill’s empiricism and psychologism. In this connection I wish to emphasize that I employ terms like “empiricism,” “historicism,” etc. without any connotation of a value judgment. Cf. Husserl, Logische Untersuchungen (3rd ed.; Halle, 1922), 1, 52, footnote.
• 28Friedrich von Wieser, “Theorie der gesellschaftlichen Wirtschaft,” Grundriss der Sozialökonomik (Tübingen, 1914), p. 133.
• 29Friedrich von Wieser, “Das Wesen und der Hauptinhalt der theoretischen Nationalökonomie,” <em>Gesammelte Abhandlungen</em>, ed. by F.A. Hayek (Tübingen, 1929), p. 17.
• 30Among the most recent works devoted to the logic and methodology of the science of human action are those of Karel Englis: Grundlagen des wirtschaftlichen Denkens, trans. by Saudek (Brünn, 1925); Begrundung der Teleologie als Form des empirischen Erkennens (Brünn, 1930); and Teleologische Theorie der Staatswirtschaft (Brünn, 1933). The opposition between causality and teleology, which is the chief concern of Englis, is not within the scope of the problems dealt with here.

1. The Basic Concept of Action and its Categorial Conditions

The starting point of our reasoning is not behavior, but action, or, as it is redundantly designated, rational action. Human action is conscious behavior on the part of a human being. Conceptually it can be sharply and clearly distinguished from unconscious activity, even though in some cases it is perhaps not easy to determine whether given behavior is to be assigned to one or the other category.

As thinking and acting men, we grasp the concept of action. In grasping this concept we simultaneously grasp the closely correlated concepts of value, wealth, exchange, price, and cost. They are all necessarily implied in the concept of action, and together with them the concepts of valuing, scale of value and importance, scarcity and abundance, advantage and disadvantage, success, profit, and loss. The logical unfolding of all these concepts and categories in systematic derivation from the fundamental category of action and the demonstration of the necessary relations among them constitutes the first task of our science. The part that deals with the elementary theory of value and price serves as the starting point in its exposition. There can be no doubt whatever concerning the aprioristic character of these disciplines.

The most general prerequisite of action is a state of dissatisfaction, on the one hand, and, on the other, the possibility of removing or alleviating it by taking action. (Perfect satisfaction and its concomitant, the absence of any stimulus to change and action, belong properly to the concept of a perfect being. This, however, is beyond the power of the human mind to conceive. A perfect being would not act.) Only this most general condition is necessarily implied in the concept of action. The other categorial conditions of action are independent of the basic concept; they are not necessary prerequisites of concrete action. Whether or not they are present in a particular case can be shown by experience only. But where they are present, the action necessarily falls under definite laws that flow from the categorial determinacy of these further conditions.

It is an empirical fact that man grows old and dies and that therefore he cannot be indifferent to the passage of time. That this has been man’s experience thus far without exception, that we do not have the slightest evidence to the contrary, and that scarcely any other experience points more obviously to its foundation in a law of nature?all this in no way changes its empirical character. The fact that the passage of time is one of the conditions under which action takes place is established empirically and not a priori. We can without contradiction conceive of action on the part of immortal beings who would never age. But in so far as we take into consideration the action of men who are not indifferent to the passage of time and who therefore economize time because it is important to them whether they attain a desired end sooner or later, we must attribute to their action everything that necessarily follows from the categorial nature of time. The empirical character of our knowledge that the passage of time is a condition of any given action in no way affects the aprioristic character of the conclusions that necessarily follow from the introduction of the category of time. Whatever follows necessarily from empirical knowledge?e.g., the propositions of the agio theory of interest?lies outside the scope of empiricism.

Whether the exchange of economic goods (in the broadest sense, which also includes services) occurs directly, as in barter, or indirectly, through a medium of exchange, can be established only empirically. However, where and in so far as media of exchange are employed, all the propositions that are essentially valid with regard to indirect exchange must hold true. Everything asserted by the quantity theory of money, the theory of the relation between the quantity of money and interest, the theory of fiduciary media, and the circulation-credit theory of the business cycle, then becomes inseparably connected with action. All these theorems would still be meaningful even if there had never been any indirect exchange; only their practical significance for our action and for the science that explains it would then have to be appraised differently. However, the heuristic importance of experience for the analysis of action is not to be disregarded. Perhaps if there had never been indirect exchange, we would not have been able to conceive of it as a possible form of action and to study it in all its ramifications. But this in no way alters the aprioristic character of our science.

These considerations enable us to assess critically the thesis that all or most of the doctrines of economics hold only for a limited period of history and that, consequently, theorems whose validity is thus limited historically or geographically should replace, or at least supplement, those of the universally valid theory. All the propositions established by the universally valid theory hold to the extent that the conditions that they presuppose and precisely delimit are given. Where these conditions are present, the propositions hold without exception. This means that these propositions concern action as such; that is, that they presuppose only the existence of a state of dissatisfaction, on the one hand, and the recognized possibility, on the other, of relieving this dissatisfaction by conscious behavior, and that, therefore, the elementary laws of value are valid without exception for all human action. When an isolated person acts, his action occurs in accordance with the laws of value. Where, in addition, goods of higher order are introduced into action, all the laws of the theory of imputation are valid. Where indirect exchange takes place, all the laws of monetary theory are valid. Where fiduciary media are created, all the laws of the theory of fiduciary media (the theory of credit) are valid. There would be no point in expressing this fact by saying that the doctrines of the theory of money are true only in those periods of history in which indirect exchange takes place.

However, the case is entirely different with the thesis of those who would subordinate theory to history. What they maintain is that propositions derived from the universally valid theory are not applicable to historical periods in which the conditions presupposed by the theory are present. They assert, for example, that the laws of price determination of one epoch are different from those of another. They declare that the propositions of the theory of prices, as developed by subjective economics, are true only in a free economy, but that they no longer have any validity in the age of the hampered market, cartels, and government intervention.

In fact, the theory of prices expounds the principles governing the formation of monopoly prices as well as of competitive prices. It demonstrates that every price must be either a monopoly price or a competitive price and that there can be no third kind of price. In so far as prices on the hampered market are monopoly prices they are determined in accordance with the laws of monopoly price. Limited and hampered competition that does not lead to the formation of monopoly prices presents no special problem for the theory. The formation of competitive prices is fundamentally independent of the extent of competition. Whether the competition in a given case is greater or smaller is a datum that the theory does not have to take into account since it deals with categorial, and not concrete, conditions. The extent of the competition in a particular case influences the height of the price, but not the manner in which the price is determined.

The Historical School has not succeeded in providing any proof of its assertion that the laws derived from the universally valid theory do not hold for all human action independently of place, time, race, or nationality. In order to prove this it would have had to show that the logical structure of human thinking and the categorial nature of human action change in the course of history and are different for particular peoples, races, classes, etc. This it could never demonstrate; indeed, philosophy has established the very opposite as the truth.1

Nor were the adherents of the Historical School ever able to point to any instance of a proposition for which the claim could be made that observation had established it as an economic law with merely temporal, local, national, or similarly limited validity. They were unable to discover such a proposition either a priori or a posteriori. If thinking and action were really conditioned by place, time, race, nationality, climate, class, etc., then it would be impossible for a German of the twentieth century to understand anything of the logic and action of a Greek of the age of Pericles. We have already shown why the a posteriori discovery of empirical laws of action is not possible.2  All that the “historical theory” could present was history—very poor history, to be sure, but, considered from a logical point of view, history nevertheless, and in no sense a theory.

2. A Priori Theory and Empirical Confirmation

New experience can force us to discard or modify inferences we have drawn from previous experience. But no kind of experience can ever force us to discard or modify a priori theorems. They are not derived from experience; they are logically prior to it and cannot be either proved by corroborative experience or disproved by experience to the contrary. We can comprehend action only by means of a priori theorems. Nothing is more clearly an inversion of the truth than the thesis of empiricism that theoretical propositions are arrived at through induction on the basis of a presuppositionless observation of “facts.” It is only with the aid of a theory that we can determine what the facts are. Even a complete stranger to scientific thinking, who naively believes in being nothing if not “practical,” has a definite theoretical conception of what he is doing. Without a “theory” he could not speak about his action at all, he could not think about it, he could not even act. Scientific reasoning is distinguished from the daily thinking of everyone only in seeking to go further and in not stopping until it reaches a point beyond which it cannot go. Scientific theories are different from those of the average man only in that they attempt to build on a foundation that further reasoning cannot shake. Whereas in everyday living one is usually content to accept uncritically ideas that have been handed down, to carry a burden of prejudices and misunderstandings of all kinds, and to allow fallacies and errors to pass as true in cases where it is not easy to avoid them; scientific theories aim at unity and compactness, clarity, precision, apodictic evidence, and freedom from contradiction.

Theories about action are implicit in the very words we use in acting, and still more in those we use in speaking about action. The frequently lamented semantic ambiguities3  that plague our efforts to achieve precision in science have their roots precisely in the fact that the terms employed are themselves the outcome of definite theories held in common-sense thinking. The supporters of historicism were able to believe that facts can be understood without any theory only because they failed to recognize that a theory is already contained in the very linguistic terms involved in every act of thought. To apply language, with its words and concepts, to anything is at the same time to approach it with a theory. Even the empiricist, who allegedly works without presuppositions, makes use of theoretical tools. They are distinguished from those produced by a scientific theory only in being less perfect and therefore also less useful.

Consequently, a proposition of an aprioristic theory can never be refuted by experience. Human action always confronts experience as a complex phenomenon that first must be analyzed and interpreted by a theory before it can even be set in the context of an hypothesis that could be proved or disproved; hence the vexatious impasse created when supporters of conflicting doctrines point to the same historical data as evidence of their correctness. The statement that statistics can prove anything is a popular recognition of this truth. No political or economic program, no matter how absurd, can, in the eyes of its supporters, be contradicted by experience. Whoever is convinced a priori of the correctness of his doctrine can always point out that some condition essential for success according to his theory has not been met. Each of the German political parties seeks in the experience of the second Reich confirmation of the soundness of its program. Supporters and opponents of socialism draw opposite conclusions from the experience of Russian bolshevism. Disagreements concerning the probative power of concrete historical experience can be resolved only by reverting to the doctrines of the universally valid theory, which are independent of all experience. Every theoretical argument that is supposedly drawn from history necessarily becomes a logical argument about pure theory apart from all history. When arguments based on principle concern questions of action, one should always be ready to admit that nothing can “be found more dangerous and more unworthy of a philosopher than the vulgar pretension to appeal to an experience to the contrary,”4  and not, like Kant and the socialists of all schools who follow him, only when such an appeal shows socialism in an unfavorable light.

Precisely because the phenomena of historical experience are complex, the inadequacies of an erroneous theory are less effectively revealed when experience contradicts it than when it is assessed in the light of the correct theory. The iron law of wages was not rejected because experience contradicted it, but because its fundamental absurdities were exposed. The conflict between its most clearly controvertible thesis—that wages tend toward the minimum needed for subsistence—and the facts of experience should have been easily recognized. Yet it is even today just as firmly entrenched in lay discussion and public opinion as in the Marxian theory of surplus value, which, incidentally, professes to reject the iron law of wages. No past experience prevented Knapp from presenting his state theory of money,*  and no later experience has forced his supporters to give up the theory.

The obstinacy of such unwillingness to learn from experience should stand as a warning to science. If a contradiction appears between a theory and experience, we always have to assume that a condition presupposed by the theory was not present, or else that there is some error in our observation. Since the essential prerequisite of action?dissatisfaction and the possibility of removing it partly or entirely?is always present, only the second possibility—an error in observation—remains open. However, in science one cannot be too cautious. If the facts do not confirm the theory, the cause perhaps may lie in the imperfection of the theory. The disagreement between the theory and the facts of experience consequently forces us to think through the problems of the theory again. But so long as a re-examination of the theory uncovers no errors in our thinking, we are not entitled to doubt its truth.

On the other hand, a theory that does not appear to be contradicted by experience is by no means to be regarded as conclusively established. The great logician of empiricism, John Stuart Mill, was unable to find any contradiction whatever between the objective theory of value and the facts of experience. Otherwise he would certainly not have made the statement, precisely on the eve of a radical change in the theory of value and price, that as far as the laws of value were concerned, there remained nothing more to be explained either in the present or in the future; the theory was quite perfect.”5  An error of this kind on the part of such a man must ever stand as a warning to all theorists.

3. Theory and the Facts of Experience

The science of action deals only with those problems whose solution directly or indirectly affects practical interests. It does not concern itself, for reasons already explained,6  with the complete development of a comprehensive system embracing all the conceivable categories of action in their broadest generality. The peculiar advantage of this procedure is that, by giving preference to the problems encountered under the actual conditions in which action takes place, our science is obliged to direct its attention to the facts of experience. It is thereby prevented from forgetting that one of its tasks consists in the determination of the boundary between the conditions of action accessible to and requiring categorial comprehension, on the one hand, and the concrete data of the individual case, on the other. The theory must constantly concern itself with the actual facts of the individual and nonrepeatable case because only this offers it the possibility of showing where (conceptually, though perhaps not spatially, temporally, or in some other respect that would be perceptible to the senses) the realm of theoretical comprehension ends and that of historical understanding begins. When the science that aims at universally valid knowledge has so perfected its methods as to reach the furthest limit to which the theory can be pursued?that is, the point at which no condition of action open to categorial comprehension remains outside its range if experience has demonstrated the advisability of its inclusion?that science will still be obliged to treat also a part of the problems of descriptive, statistical, and historical research. Otherwise it could in no way succeed in recognizing and marking off its own domain. This task of demarcation is proper to it, and not to the empirical, descriptive sciences, because it is logically prior to them.

To be sure, even this procedure conceals many dangers. Sometimes one neglects to distinguish the universally valid from the historical; the methods are confounded, and then unsatisfactory results are obtained. Thus Böhm-Bawerk’s ingenious exposition of the theory of interest, for example, suffered especially from an insufficient separation between the two modes of procedure.

4. The Distinction Between Means and Ends: The “Irrational”

Most of the objections raised against the science of action stem from a misconception of the distinction between means and ends. In the strict sense, the end is always the removal of a dissatisfaction. However, we can doubtless also designate as an end the attainment of that condition of the external world which brings about our state of satisfaction either directly or indirectly, or which enables us to perform, without further difficulties, the act through which satisfaction is to be obtained. If the removal of the feeling of hunger is the end sought, the procuring of food and its preparation for eating can also be considered as ends; if one seeks the removal of the feeling of cold as an end, the heating of one’s quarters can just as well be called an end. If additional measures are needed for the removal of dissatisfaction, then the attainment of any particular step along the way toward the desired final condition is also designated as an end. In this sense the acquisition of money in the market economy and, proximately, the division of labor are designated as ends of action; in this sense too the attainment of all things that indirectly promote the end of want-satisfaction appear as proximate or intermediate ends.

In the course of attaining the primary end, secondary ends are attained. A man walks from A to B. He would choose the shortest route if other, secondary ends did not demand satisfaction. He makes a detour if he can walk in the shade a little longer; if he can include in his walk another place, C, which he wants to look for; if, by doing so, he can avoid dangers that may be lying in wait for him on the shortest route; or if he just happens to like the longer route. If he decides on a detour, we must infer that at the moment of decision the attainment of such secondary ends was of greater importance in his judgment than the saving of distance. Consequently, for him the “detour” was no detour at all, since his walk brought him greater satisfaction or?at least from the point of view that he took of his situation at the moment of decision?was expected to bring greater satisfaction than the attainment of his destination by the shorter route. Only one who does not have these secondary ends in mind can call the longer way a detour. As far as our stroller was concerned, it was the correct route, that is, the route that promised the greatest satisfactions.7

Since satisfaction and dissatisfaction depend only on the subjective view of the individual, there is no room for argument on this question in a science that does not presume to establish a scale of values or to make judgments of value. Its conception of an end, in the strict sense, is more deductive than empirical: ends are determined by the wishes and the desires of the individual. Whenever reference is made to the greater or lesser appropriateness of means, this can only be from the point of view of the acting individual.

We must next deal with the objection of those who never weary of asserting that man does not act rationally at all. It has never been disputed that man does not always act correctly from the objective point of view; that is, that either from ignorance of causal relations or because of an erroneous judgment of the given situation, in order to realize his ends he acts differently from the way in which he would act if he had correct information. In 1833 the method of healing wounds was different from that used in 1933, and in 2033 still another way will presumably be thought suitable. Statesmen, field marshals, and stock-market speculators act differently at present from the way in which they would act if they knew exactly all the data needed for an accurate judgment of conditions. Only a perfect being, whose omniscience and omnipresence would enable him to survey all the data and every causal relationship, could know how each erring human being would have to act at every moment if he wanted to possess the divine attribute of omniscience. If we were to attempt to distinguish rational action from irrational action, we should not only be setting ourselves up as a judge over the scales of value of our fellow men, but we should also be declaring our own knowledge to be the only correct, objective standard of knowledge. We should be arrogating to ourselves the position that only an all-knowing being has the power to occupy.

The assertion that there is irrational action is always rooted in an evaluation of a scale of values different from our own. Whoever says that irrationality plays a role in human action is merely saying, that his fellow men behave in a way that he does not consider correct. If we do not wish to pass judgment on the ends and the scales of value of other people and to claim omniscience for ourselves, the statement, “He acts irrationally,” is meaningless, because it is not compatible with the concept of action. The “seeking to attain an end” and the “striving after a goal” cannot be eliminated from the concept of action. Whatever does not strive after goals or seek the attainment of ends reacts with absolute passivity to an external stimulus and is without a will of its own, like an automaton or a stone. To be sure, man too is as far outside the effective range of his action as a reed in the wind. But in so far as he is able to do anything, he always acts: even negligence and passivity are action if another course of conduct could have been chosen. And the conduct that is determined by the unconscious, in the Freudian sense, or by the subconscious, is also action in so far as conscious behavior could prevent it but neglects to do so. Even in the unconscious and apparently senseless behavior of the neurotic and the psychopath there is meaning, i.e., there is striving after ends and goals.”8

Everything that we say about action is independent of the motives that cause it and of the goals toward which it strives in the individual case. It makes no difference whether action springs from altruistic or from egoistic motives, from a noble or from a base disposition; whether it is directed toward the attainment of materialistic or idealistic ends; whether it arises from exhaustive and painstaking deliberation or follows fleeting impulses and passions. The laws of catallactics that economics expounds are valid for every exchange regardless of whether those involved in it have acted wisely or unwisely or whether they were actuated by economic or noneconomic motives.9  The causes of action and the goals toward which it strives are data for the theory of action: upon their concrete configuration depends the course of action taken in the individual case, but the nature of action as such is not thereby affected.

These considerations have an evident bearing on the widespread tendency of the present age to appeal to the irrational. The concepts rational and irrational are not applicable to ends at all. Whoever wishes to pass judgment on ends may praise or condemn them as good or evil, fine or vulgar, etc. When the expressions “rational” and “irrational” are applied to the means employed for the attainment of an end, such a usage has significance only from the standpoint of a definite technology. However, the use of means other than those prescribed as “rational” by this technology can be accounted for in only two possible ways: either the “rational” means were not known to the actor, or he did not employ them because he wished to attain still other ends?perhaps very foolish ones from the point of view of the observer. In neither of these two cases is one justified in speaking of “irrational” action.

Action is, by definition, always rational. One is unwarranted in calling goals of action irrational simply because they are not worth striving for from the point of view of one’s own valuations. Such a mode of expressions leads to gross misunderstandings. Instead of saying that irrationality plays a role in action, one should accustom oneself to saying merely: There are people who aim at different ends from those that I aim at, and people who employ different means from those I would employ in their situation.

• 1See below pp. 102 f. for a further discussion of this point.
• 2Supra, pp. 9 ff.
• 3Cf. Wieser, Über den Ursprung und die Hauptgesetze des wirtschaftlichen Wertes (Wien, 1884), pp. I ff.
• 4 Kant, Critique of Pure Reason, “Transcendental Doctrine of Elements,” Part II, Second Division, Book I, Section I.
• *Cf. the English translation of his book with this title by H. M. Lucas and J. Bonar (London, 1924).
• 5J. S. Mill, Principles of Political Economy (London, 1867), III, 265.
• 6Supra, pp. 14 ff.
• 7Cf. Robbins, An Essay on the Nature and Significance of Economic Science (London, 1932), p. 23.
• 8Cf. Freud, Lectures on the Introduction to Pvychoanalysis, 17th lecture.
• 9Cf. Wicksteed, The Common Sense of Political Economy, ed. by Robbins (London, 1933), 1, 28.

1. The Meaning of Neutrality With Regard to Value Judgments

The fact that the science of economics had its origin in economic policy explains why most economists use expressions in the presentation of the theory that involve judgments and standards of value accepted by all mankind, or certainly by almost all men. If, for example, one is discussing the effects of tariffs, one usually employs, or at least one used to employ, terms that call a situation in which a given amount of capital and labor was able to produce a definite quantity of material economic goods “better” than a situation in which the same amount could produce only a smaller quantity.

The use of such expressions can hardly be said to imperil seriously the scientific character of the investigation, which precludes all standards and judgments of value. Whoever is of the opinion that economic policy ought to be differently oriented, i.e., in such a way that men become not richer in material goods, but poorer, can learn from the doctrine of free trade all that he needs to know in order to enter upon the path that leads to the goal he aspires to reach. If he himself were to undertake to develop the theory, he would, provided his reasoning were correct, arrive at the same results as other theorists, except that in his presentation he would use different expressions in a few incidental remarks and digressions that are unimportant from the point of view of what is essential in the theory. The objectivity of bacteriology as a branch of biology is not in the least vitiated by the fact that the researchers in this field regard their task as a struggle against the viruses responsible for conditions harmful to the human organism. Their theories are completely objective even though their presentation may be interlaced with terms like “harmful” and “useful”, “favorable,” and “unfavorable,” and the like, implying judgments of value. They neither raise nor answer questions concerning the value of life and health; and their findings are independent of the individual researchers’ valuation of these endowments. Whether one wishes to destroy rather than preserve human life, or whether, like the doctor, one seeks to cure and not to kill, he will, in either case, be able to draw from the results of their research all that he needs to know to accomplish his purpose.

One can be of the opinion that the “unfavorable” effects of tariffs, as set forth by the theory of free trade, are more than counterbalanced by other effects that warrant paying the price of the former. In that case one has the task, if one wishes to be scientific, of first of all pointing out and demonstrating these other effects as exactly and as clearly as possible. It then becomes the concern of politics to make the decision. In this connection it is by no means undesirable for the economist to take part in the discussion of policy. No one is better qualified to explain the matter at issue clearly and completely to those who have to make the decision. Of course, in doing so the economist is always under the obligation to make clear where the scientific explanation of causal relationships ends and where a clash of values requires to be resolved.

What is impermissible, however, is the obliteration of the boundary between scientific explanation and political value judgment. Although themselves guilty of this very failing, there are those who continually reproach economics for its alleged political bias because in writings on this subject one often employs terms that do not call into question generally accepted standards of value. Precisely these critics know only too well that they would be unable to attain their political goals if they were to admit that their proposals do not prove acceptable when gauged by such standards. The protectionists are well aware of the fact that they would have no hope of achieving their objectives if those called upon to decide the issue were to realize that protectionism lowers the productivity of labor as regards material goods. Because they know this, and because they want to set up protective tariffs notwithstanding, they go to great lengths to try to prove that Protective tariffs are to be regarded as advantageous even “from the economic point of view.” And because they fail lamentably in these endeavors, they charge economics with political bias.

2. Science and Technology: Economics and Liberalism

Whether science seeks knowledge for its own sake or in order thereby to obtain information for the sake of action, or whether it aims at both ends at the same time, it is in any case permissible to make practical use of the results of scientific investigation. Man thinks not only for the sake of thinking, but also in order to act. There would be no need to repeat these truisms were it not for the fact that antiliberal, partisan propaganda in the guise of science day after day vehemently seeks to deny them.

The fact that economics, as a science, is neutral with regard to judgments of value and that it can express neither approval nor disapproval does not prevent us from trying to learn from economics how we must arrange our action in order to achieve the ends at which we aim. The ends can be diverse. Caligula, who wished that the whole Roman people had but one head so that he might decapitate them at a single stroke, had different ends in mind from those of other mortals. However, such exceptional cases are rare; and their tendency to be self-destructive (Caligula, indeed, would hardly have long survived the fulfillment of his wish) makes an exhaustive concern with their ideals unnecessary. No matter how much their wishes, desires, and valuations may differ in details, men aim, for biological reasons, at the same basic ends. Regardless of world view, religion, nationality, race, class, position, education, personal abilities, age, health, or sex, they aspire above all to be able to pass their lives under the most favorable physiological conditions possible. They want to eat and drink; they seek clothing, shelter, and various other things in addition. Moreover, they are of the opinion that more food, clothing, and the like, is better than less.

Every individual desires life, health, and well-being for himself and for his friends and close relations. At the same time, the life, health, and well-being of others may be indifferent to him. Filled with the atavistic instincts of a beast of prey, he may even believe that others stand in his way, that they are depriving him of foraging grounds, and that the satisfaction of his wants must involve the killing and robbing of his fellow men. But the technology based on the cognition’s of the science of human action shows him that this is not so. Work performed under the division of labor is more productive than the isolated labor of the individual. Even when superior men combine with those less favored in every respect and inferior to them in capacity for work and intellectual and physical abilities, both sides gain, as is demonstrated by Ricardo’s law of association (usually called the law of comparative costs). Consequently, every individual is better able to attain his ends by the social cooperation of labor than by isolated work.

Social cooperation, however, can be based only on the foundation of private ownership of the means of production. Socialism—the public ownership of the means of production—would make impossible any economic calculation and is therefore impracticable. The absurdity of syndicalism is undisputed. As for interventionist encroachments, they prove—when judged from the point of view of those who advocate them—senseless and contrary to purpose, because they not only do not bring about the results desired by their supporters, but involve consequences that they themselves must deprecate.

Therefore, when one reaches the conclusion, strictly by adherence to the canons of scientific procedure, that private ownership of the means of production is the only practicable form of social organization, this is neither an apology for capitalism nor an improper attempt to lend the authority of science to the support of liberalism. To the man who adopts the scientific method in reflecting upon the problems of human action, liberalism must appear as the only policy that can lead to lasting well-being for himself, his friends, and his loved ones, and, indeed, for all others as well. Only one who does not want to achieve such ends as life, health, and prosperity for himself, his friends, and those he loves, only one who prefers sickness, misery, and suffering may reject the reasoning of liberalism on the ground that it is not neutral with regard to value judgments.

The defenders of the prevailing etatist and interventionist system completely misunderstand this. They think that the acceptance of liberalism, on the assumptions mentioned, presupposes a definite world view.1  Liberalism has nothing to do with world views, metaphysics, or value judgments.

We can imagine beings similar to men who would want to extinguish their humanity and, by putting an end to all thought and action, to attain to the unthinking, passive, vegetative existence of plants. It is doubtful whether there are or have ever been such men. Even St. Aegidius, the most radical advocate of asceticism, was not altogether consistent in his zeal for austerity when he recommended the birds and the fish as a model for man. To be entirely consistent, together with the Sermon on the Mount, he would have had to extol the lilies of the field as the embodiments of the ideal of complete abandonment of all concern for the improvement of one’s lot.

We have nothing to say to men of this kind, consistent ascetics who by their self-denying passivity give themselves up to death, just as they would have nothing to say to us. If one wishes to call their doctrine a world view, then one must not forget to add that it is not a human world view, since it must lead to the extinction of mankind. Our science sees men only as acting men, not as plants having the appearance of men. Acting man aims at ends, i.e., he wants to overcome dissatisfaction as far as possible. Our science shows that aiming at ends is necessary to existence and that human ends, whatever they may be, are better attained by the social cooperation of the division of labor than in isolation. (It is worthy of note that no historical experience has been found in conflict with this proposition.) Once one has appreciated this fact, one realizes that no standard of value of any kind is contained in the system of economic or sociological theory or in the teachings of liberalism, which constitute the practical application of this theory to action in society. All objections to the effect that economics, sociology, and liberalism are predicated on a definite world view prove untenable once it is recognized that the science of action is concerned only with acting men and that it can say nothing about plant-like beings living with no thought of tomorrow, whom we can scarcely consider as human.

3. The Universalist Critique of Methodological Individualism

The reproach of individualism is commonly leveled against economics on the basis of an alleged irreconcilable conflict between the interests of society and those of the individual. Classical and subjectivist economics, it is said, give an undue priority to the interests of the individual over those of society and generally contend, in conscious denial of the facts, that a harmony of interests prevails between them. It would be the task of genuine science to show that the whole is superior to the parts and that the individual has to subordinate himself to, and conduct himself for, the benefit of society and to sacrifice his selfish private interests to the common good.

In the eyes of those who hold this point of view society must appear as a means designed by Providence to attain ends that are hidden from us. The individual must bow to the will of Providence and must sacrifice his own interests so that its will may be done. His greatest duty is obedience. He must subordinate himself to the leaders and live just as they command.

But who, one must ask, is to be the leader? For many want to lead, and, of course, in different directions and toward different goals. The collectivists, who never cease to pour scorn and derision on the liberal theory of the harmony of interests, pass over in silence the fact that there are various forms of collectivism and that their interests are in irreconcilable conflict. They laud the Middle Ages and its culture of community and solidarity, and with romantic sentimentality they wax ecstatic over the communal associations “in which the individual was included, and in which he was kept warm and protected like fruit in its rind.”2  But they forget that papacy and empire, for example, opposed each other for hundreds of years and that every individual could find himself at any time in the position of having to choose between them. Were the inhabitants of Milan also “kept warm and protected like fruit in its rind” when they had to hand over their city to Frederick Barbarossa? Are there not various factions fighting today on German soil with bitter anger, each of which claims to represent the only true collectivism? And do not the Marxian socialists, the national socialists, the church, and many other parties approach every individual with the demand: join us, for you belong in our ranks, and fight to the death the “false” forms of collectivism? A collectivist social philosophy that did not designate a definite form of collectivism as true and either treat all others as subordinate to it or condemn them as false would be meaningless and vain. It must always tell the individual: Here you have an unquestionably given goal, because an inner voice has revealed it to me; to it you must sacrifice everything else, yourself above all. Fight to victory or death under the banner of this ideal, and concern yourself with nothing else.

Collectivism, in fact, can be stated in no other way than as partisan dogma in which the commitment to a definite ideal and the condemnation of all others are equally necessary. Loyola did not preach just any faith, but that of the Church of Rome. Lagarde did not advocate nationalism, but what he regarded as German nationalism. Church, nation, state in abstracto are concepts of nominalistic science. The collectivists idolize only the one true church, only the “great” nation?the “chosen” people who have been entrusted by Providence with a special mission?only the true state; everything else they condemn.

For that reason all collectivist doctrines are harbingers of irreconcilable hatred and war to the death.

The theory of the division of labor—the starting point of sociology—demonstrates that there is no irreconcilable conflict, as collectivist metaphysics maintains, between the interests of society and those of the individual. In isolation the individual cannot attain his ends, whatever they may be, or at least not to the same extent as by social cooperation. The sacrifices be makes for the maintenance of social cooperation arc therefore only temporary: renunciation of a momentary benefit for the sake of an advantage that endures throughout the continued existence and evolution of the division of labor. Society comes into being and develops not by virtue of a moral law imposed on mankind by mysterious powers bent on forcing the individual, against his interests, into subordination to the social whole, but through the action of individuals cooperating in the attainment of ends that they severally aim at, in order to take advantage of the higher productivity brought about by the division of labor. The sum and substance of the “individualistic” and “atomistic” theory of society is that every individual benefits from the existence of society and that no one would be better off as a freebooting individual in an imaginary state of isolation, searching for food on his own and engaging in the war of all against all, than as a member of society, though a thousand times more constrained and circumscribed.

The collectivists contend that “individualism” sees in society only the sum total of individuals, whereas society is really something specific.3  However, science is not at all concerned with determining what society is, but with the effect of labor performed under conditions of social cooperation. And its first statement is that the productivity of social cooperation surpasses in every respect the sum total of the production of isolated individuals.

For the purposes of science we must start from the action of the individual because this is the only thing of which we can have direct cognition. The idea of a society that could operate or manifest itself apart from the action of individuals is absurd. Everything social must in some way be recognizable in the action of the individual. What would the mystical totality of the universalists be if it were not alive in every individual? Every form of society is operative in the actions of individuals aiming at definite ends. What would a German national character be that did not find expression in the Germanism of individuals? What would a church be that did not express the faith of individuals? That one is a member of a market society, a party comrade, a citizen, or a member of any other association must be shown through his action.

Spann, the most prominent present-day champion of universalism, strongly emphasizes that universalist sociology deals with spiritual facts that cannot be drawn from experience because they “possess, by virtue of their a priori character, a pre-empirical, supra-empirical existence.”4

In the first place, this is not accurately expressed. Only the laws of human action can be derived a priori; but it is experience alone that can establish whether or not the categorial prerequisites of action are also present in the concrete case. (Here we may pass over the fact that every experience presupposes something given a priori.) One can infer from the a priori theory of action that the division of labor is not practicable without some way by which men can communicate with one another. But only experience can show whether the division of labor and language exist in fact. And experience alone can tell us that different linguistic systems are to be found in the world and that from this fact particular consequences must follow—consequences which, a priori, are at best recognized as possible, but certainly not as having been established as existing. It cannot be deduced a priori that between the totality constituted by humanity or the totality constituted by a world state, on the one hand, and the individual, on the other, stand the totalities constituted by people, race, state, and linguistic community; this can be ascertained only through experience.

However, what Spann has in mind when he declares the a priori method to be the only one appropriate for sociology as he conceives it is not at all a priori reasoning, but intuitive insight into a whole. Again and again science is reproached for its inability to grasp the whole of life, becoming, and being. In its hands the living whole becomes a dead patchwork; the brilliance and color of creation pale, and the infinite variety and beauty of the universe wither into a rational pattern. A new science must arise which would teach us to grasp the whole in its entirety. Only knowledge of this kind deserves the name of true science. Everything else is merely rational explanation and as such is untrue because it is unable to approach the splendor of creation.

4. The Experience of a Whole and Scientific Cognition

Science, which is dependent both on discursive reasoning and on experience, does not present us with a unified picture of the world. It reduces phenomena to a number of concepts and propositions that we must accept as ultimate, without being able to establish a connection between them. It proves incapable of closing the gap that exists between the system of the sciences of human thought and action and the system of the sciences of physical nature. It does not know how to find a bridge between sentience and motion or between consciousness and matter. What life and death are eludes its grasp.

But what reason and the experience of the natural sciences have denied us is given to us by personal experience, though in a different manner from that of science. We are unable to fathom life through reason, nor can we experience it through science. Reason and science deal only with isolated fragments detached from the living whole and thereby killed. They never refer to life as it is lived and never to life as a whole. But we experience life in living, and in living our life we live life as such: we experience the unity and indissoluble congenerousness of all life. We are unable to grasp the whole by reasoning, but we can experience it in living.

This personal experience of wholeness, unity, and infinity is the loftiest peak of human existence. It is the awakening to a higher humanity. It alone transforms everyday living into true living. It is not vouchsafed to us daily or at all places. The occasions on which we are brought closer to the world spirit must await a propitious hour. Such moments occur only seldom, but they are a thousand fold rewarding, and reflection upon them illumines the passing days, weeks, months, and years.

What we experience in these moments of exaltation fills our deepest and most personal thoughts and feelings. They are so private and personal that we are unable to communicate them to anyone else. They are so deep within us that they cannot make a clear impression on our own consciousness. Whoever in the presence of his beloved or in the contemplation of an aspect of nature or in the stirring of his own strength has experienced the power of the infinite finds it impossible to tell either himself or others what it is that moves him and how it moves him. The whole remains ineffable because reason and language are unable to enter here.

Art is nothing more than a faltering and inadequate attempt to express what has been thus experienced and to give some form to its content. The work of art captures not the experience, but only what its creator has been able to express of the experience. Missing are the content, the color, and the vitality of the experience, which come entirely from within. Of course, the work of art can kindle a new personal experience if one allows oneself to be affected by it. However, the experience that the work of art evokes is not adequate to what its creator wanted to express. The artist gives the work tone, melody, color, words, and form, but not personal experience. Yet we derive more from it than the mere sensation of tone, melody, color, words, and form: we experience it. And this personal experience is another and a new experience of a different kind. The same is true of all forms of mysticism and metaphysics. We grasp the words, but we ourselves must add the meaning, the personal experience. For our means of expression and of thought do not touch life in its fullness and wholeness. As the ancient Brahmin sages said, it is that “which words and thoughts seek without finding.”5

That is why there can be no progress or evolution in metaphysics, mysticism, and art. The accuracy with which a work renders the likeness of the external world can be enhanced, but not what is essential, not what is artistic in it. The most primitive work of art also can express the strongest experience, and it speaks to us, if only we let it, and leads us into depths that science can never make accessible.

Again and again those who want to obliterate the boundary between scientific knowledge and mystical intuition in personal experience reproach science for stopping at the surface of things and not penetrating into the depths. One has to recognize that science is not metaphysics, and certainly not mysticism; it can never bring us the illumination and the satisfaction experienced by one enraptured in ecstasy. Science is sobriety and clarity of conception, not intoxicated vision.

It is true, as Bergson has seen with unsurpassed clarity, that between reality and the knowledge that science can convey to us there is an unbridgeable gulf.6  Science cannot grasp life directly. What it captures in its system of concepts is always of a different character from the living whole.7  One may therefore, if one wishes, even call it dead, because what is not life is death. But if one thinks that one has thereby pronounced an unfavorable judgment on science, one is mistaken. One can call science dead, but one cannot say that it is not useful. It is indispensable in a double sense: first, as the sole means that can lead us to whatever measure of knowledge we can attain at all; and then, as the only foundation for an action that brings us closer to the ends at which we aim. Whether we see the greatest value in wisdom or in action, in neither case may we scorn science. It alone shows us the way both to knowledge and to action. Without it our existence would be only vegetative.

5. The Errors of the Universalist Doctrine

Thus every argument of the universalist critique directed against the methodological individualism of sociology, and of economics in particular, proves unwarranted. Science cannot proceed otherwise than discursively. its starting points must have as much certainty as human knowledge is capable of, and it must go on from there, making logical deductions step by step. It can begin as an aprioristic science with propositions necessary to thought that find their support and warrant in apodictic evidence; or as an empirical science it can start with experience. But never can it take as its starting point the vision of a whole.

One would misunderstand the nature and function of cartography if one were to demand that maps show mountains and forests in all their beauty and grandeur. The most exquisite description of the loveliness of the countryside could not in the least compensate us for the map. It would not be able to show us the path that leads to the goals we want to reach. It is not for botany to discuss the beauty and the charm of flowers; it may not take its starting point from forests and meadows, but from the individual plants, and it studies plants from the standpoint of vegetable physiology and plant biology by basing its knowledge on that of the cell.

When universalism opposes the thesis that “natural laws of mechanistic causality” underlie social phenomena, we can agree in so far as there is a fundamental difference between the observation of nature and the comprehension of meaning that is characteristic of the sciences of human action. The view of behaviorism is just as untenable as the epistemological position taken by Schumpeter in his first book.8  All mechanistic analogies are misleading.

However, we can no more do without the category of causality in our scientific thinking than in everyday thinking; it is the only category that cannot be thought away.9  Indeed, a mode of reasoning that did not involve reference to causality could not arrive at the concepts of God and the whole. That science means, above all, conceptual thinking will not, of course, be disputed. But thinking must always be causal and rational.

Human reasoning does not have the power to exhaust completely the content of the universe. In the sciences of human action it goes as far as conceptual thinking can go. Beyond this point nothing more can be done than to determine what the irrational facts are by means of the specific understanding of the moral sciences.

The error of universalism, as well as of other doctrines that attempt to deal with the methodological and logical uncertainties of the moral sciences, consists in the failure to see that understanding—i.e., insight into form and quality—is not the sole or the preeminent method of the moral sciences, but on the contrary, that it must be logically and temporally preceded by conception, i.e., the intellectual comprehension of meaning.

6. “Objective” Meaning

The metaphysical systems of the philosophy of history presume to be able to detect behind the appearance of things their “true” and “real” essence, which is hidden to the profane eye. They imagine themselves capable of discovering the final purpose of all mundane activity. They want to grasp the “objective meaning” of events, which, they maintain, is different from their subjective meaning, i.e., the meaning intended by the actor himself. In this respect all systems of religion and all philosophies of history proceed according to the same principles. Notwithstanding the bitterness with which they fight one another, Marxian socialism, German national socialism, and the non-German movements related to it, which have taken a variety of forms, are all in agreement on logical method; and it is worth noting that they can all be traced back to the same metaphysical foundation, namely, the Hegelian dialectic.

The science of human action knows of no way that could lead reasoning men to knowledge of the hidden plans of God or Nature. It is unable to give any answer to the question of the “meaning of the whole” that could be logically established in the manner in which the findings of scientific thought must be in order to be acknowledged at least as provisional truths. It deliberately abstains from intruding into the depths of metaphysics.10  It suffers lightly the reproach of its opponents that it stops at the “surface” of things.

It is not to be denied that the loftiest theme that human thought can set for itself is reflection on ultimate questions. Whether such reflection can accomplish anything is doubtful. Many of the most eminent minds of the past were of the opinion that thought and cognition overstep their domain of effectiveness when they apply themselves to such tasks. In any case, it is certain that differences of a fundamental nature exist between metaphysical speculations and scientific investigation?differences that may not be ignored without peril. It is the function of science to think out to their ultimate conclusions the a priori prerequisites of knowledge in their purity, to develop thereby a comprehensive theoretical system, and, with the aid of the results so obtained, to extract from the data of experience all that they can teach.

On the other hand, it is no part of the task of science to examine ultimate questions or to prescribe values and determine their order of rank. Nevertheless, one may call the fulfillment of these tasks higher, nobler, and more important than that of the simpler task of science, which is to develop a theoretical system of cause-and-effect relationships enabling us to arrange our action in such a way that we can attain the goals we aim at. One may hold poets, prophets, or promulgators of new values in higher esteem than scientists. But in no case is one free to confound these two fundamentally different functions. For example, one may not attempt, in compliance with Novalis’ invitation, to “poetize” the science of finance.11

Metaphysics and science perform different functions. They cannot, therefore, adopt the same procedures, nor are they alike in their goals. They can work side by side without enmity because they need not dispute each other’s domain as long as they do not misconstrue their own character. A conflict arises only when one or the other attempts to overstep the boundary between them. Positivism thought that, in place of uncertain speculations and poetry masquerading as philosophy, it would be able, through the application of the methods of science to the problems dealt with by metaphysics, to adopt a procedure guaranteeing the certainty of scientific demonstration to the treatment of the ultimate objects of knowledge. What it failed to see was that from the moment it undertook to treat of metaphysical problems, it itself also necessarily engaged in metaphysics. Precisely because it did not see this, its own metaphysics, notwithstanding its professions of scorn for everything metaphysical, was naive in the extreme.

On the other hand, securely established conclusions of scientific thought are again and again attacked on metaphysical grounds. Now, of course, nothing that is scientifically established can be brought against the assumption that things could present themselves to a mind other than human differently from the way in which we see and experience them, so that the science of this other mind would possess a different content from ours. Our own thinking is utterly powerless to discover anything whatever about what such a superhuman or divine being would think. But within the cosmos in which our action is effective and in which our thinking paves the way for action, the findings of our scientific reasoning are so securely established as to render meaningless the statement that, in a broader setting or in a deeper sense, they would have to lose their validity and yield to some other cognition.

Since we must concern ourselves here not with empirical science, but with the apriorism of the science of human action, we need not consider the encroachments of metaphysics upon the domain of the former. It is obvious that the attempts to use metaphysical arguments to refute what follows from a priori ratiocination are tantamount to replacing discursive reasoning by the arbitrariness of intuitive flights of fancy. No metaphysics is in any way able to undermine the concept of action. Consequently, metaphysics can detract nothing from whatever is necessarily deduced from that concept. When we seek to comprehend categorially the prerequisites of human action, one may criticize and correct our procedure, if it goes wrong, by resort to scientific reasoning. However, whatever firmly withstands the logical scrutiny of our reason can in no way be refuted by the assertions of metaphysics. It is no more permissible to deny recognition to any of the propositions of economics—for example, the theory of value and of price formation—by referring to the fact that one has a different “world view” or that one’s “interests” give one a different—e.g., the “proletarian”—standpoint than it would be to use the statements of metaphysics to argue down the binomial theorem. No vision of totality, no universalism, and no “sociologism” can allow us to “understand” things differently from the way in which they must present themselves to our sober reasoning. If I am unable to show through arithmetical reasoning that arithmetic is contradictory in saying three times three equals nine, I am not warranted in asserting that in a “higher” or “deeper” sense another answer has to be true.

The conclusions that must be drawn from the findings of economics do not meet the approval of those whose immediate, momentary interests make it appear desirable that other teachings be recognized as correct. Inasmuch as they are at a loss to discover any error in the logical structure of economics, they call upon supramundane powers for help.

• 1E.g., Vleugel’s “Probleme der Wertlehre,” Archiv für Sozialwissenschaft und Sozialpolitik, LXVIII, 227f. Liberalism has no thought of denying the existence of servilism and its world view. All that liberalism endeavors to demonstrate is that the realization of the goals of servilism would necessarily bring about consequences of whose inevitability its advocates are in ignorance and which, even in their own eyes, must appear as too high a price to have to pay for the attainment of their ideal.
• 2Sombart, Der proletarische Sozializmus (10th ed.; Jena, 1924), I, 31.
• 3Spann, article “Soziologie,” Handwörterbuch der Staatswissenschaften (4th edition), VII, 655,
• 4Ibid.
• 5Cf. Deussen, Vedânta, Platon und Kant (Vienna, 1917), p. 67.
• 6Cf. Bergson, L’évolution créatrice (7th ed.; Paris, 1911), pp. I ff.
• 7This has never been denied, not even by the empiricism of the natural sciences, Erasmus Darwin wrote: “Following life, in creatures we dissect,/ We lose it, in the moment we detect.” Quoted by J. S. Mill in his System der deductiven und inductiven Logik, trans. by von Gomperz (Leipzig, 1872), 11, p. 163.
• 8Das Wesen und der Hauptinhalt der theoretischen Nationalökonomie (Leipzig, 1908).
• 9Cf. Schopenhauer, Die Welt as Wille und Vorstellung (Collected Works, edited by Frauenstädt, 2nd ed.; Leipzig, 1916), II, 531.
• 10Sulzbach, Die Grundlagen der politischen Parteibildung (Tübingen, 192 1), pp. v f.
• 11Quoted by Freyer in Die Bewertung der Wirtschaft im philosophischen Denken des 19. Jahrhunderts (Leipzig, 1921), p. 49.

1. Vierkandt’s Instinct Sociology

None of the objections that have been raised for thousands of years against hedonism and utilitarianism has the least bearing upon the theory of action. When the correlative concepts of pleasure and pain, or utility and disutility, are grasped in their formal sense and are deprived of all material content, all the objections that have been repeated ad nauseam for ages have the around cut from under them. It requires a considerable unfamiliarity with the present state of the argument to raise once again the old charges against “immoral” hedonism and “vulgar” utilitarianism.

Today it is customary, when one finds oneself compelled to acknowledge the logical impossibility of any other view, to say that the formal conception of pleasure and utility is devoid of all cognitive value. In grasping these ideas in their purity, the concept of action, it is said, becomes so empty that nothing more can be done with it. To answer this criticism one need only point to all that economic theory has been able to deduce from the allegedly empty concept of action.

If one attempts to engage in the scientific investigation of what, in our view, constitutes the subject matter of the science of human action without resort to the proscribed principle of hedonism, one falls unawares into empiricism, which cannot succeed in connecting into a system the multiplicity of facts it encounters or in using them for the explanation of the phenomena that are to be comprehended. An example may make this clear. in his endeavor to construct a theory of society, Vierkandt knows no other means than to ascribe to men a series of “social propensities.” In this regard he follows the procedure of a great number of investigators. He understands by the social propensities of man

such innate instincts (e.g., the instinct to be of help) and other innate characteristics and modes of behavior (e.g., understanding and susceptibility to influence) as presuppose for their manifestation the presence of other men, or, more precisely, the condition of society.

In addition, there are still other propensities such as also or only “manifest themselves in relation to other entities.”1  And here Vierkandt goes on to enumerate and describe a series of instincts, propensities, and impulses.

Such an enumeration can never, of course, be complete. The distinction between one instinct and another must necessarily be arbitrary. To be quite consistent one would have to link a corresponding instinct with every goal that has ever been aimed at anywhere and at any time. If, for example, one assumes the existence of an instinct for food, from which one distinguishes the instinct for means of enjoyment, there is no reason why one should not go further and speak also of an instinct for meat or, even more specifically, of an instinct for beef or, still more specifically, of an instinct for beefsteak. What one has in view in speaking simply of the instinct for food is a summary statement in terms of the end aimed at by the actions of men directed toward the provision of different foods. If one represents, in summary form, actions directed toward the consumption of carbohydrates, fats, and proteins as the result of the instinct for food, one can, in the same way and with the same justification, also look upon actions directed toward providing food, shelter, and clothing, as well as a great many other actions, as the result of the instinct for self-preservation. How far one goes in this process of generalization is entirely a matter of arbitrary choice, unless one makes a radical change in one’s whole mode of reasoning and passes to the level of broadest generality, i.e., to the formal concept of the end devoid of all material content. Because Vierkandt rejects utilitarianism and hedonism and therefore does not take this decisive step, he comes to a stop at an arbitrary division of the various human wants.

The innate social propensities appear, Vierkandt goes on to explain, “frequently in pairs of opposites.” Thus, pitted against the “instinct of self-esteem” is “its opposite, the instinct of obedience”; against the “instinct to be of help,” the “fighting instinct”; against the “sociable instinct,” an “instinct of avoidance” ; against the “communicative instinct,” an “instinct of secretiveness and concealment.”2  Since nothing can be said about the strength with which these opposed instincts make themselves felt, one cannot understand how the rise of social cooperation is to be explained on the basis of them. Even if we pass over the impermissible hypostasis involved in the statement that the “social propensities” lead to the development of social cooperation, we still lack any adequate explanation for the fact that the social instincts are victorious over the antisocial instincts. Why is it that the fighting instinct, the instinct of self-esteem, and the instinct of avoidance do not frustrate the formation of social bonds?

The “instinct of self-esteem,” Vierkandt maintains, cannot manifest itself “without the instinct of subordination being active at the same time.” Here, he continues, one has to deal with the “characteristic coalescence of opposed instincts; in this regard the total picture is, of course, modified by the instinct of domination.”3  Assuming an “instinct of subordination,” one is forced, if one does not choose to be completely blind to reality, to assume an opposite instinct: Vierkandt calls it the instinct of self-esteem. (Wiese objected with good reason that Vierkandt, when he recognizes an instinct of subordination, would have to “allow no less for an instinct of rebellion, which is, of course, very important in history and in the life of the individual.”4 ) Yet Vierkandt is unable to produce any other proof that the instinct of subordination is victorious over the instinct of self-esteem than the fact that in his presentation he labels the former the stronger and better instinct. “Subordination,” he asserts, “is a condition which is healthy, normal, and conducive to happiness; a condition in which the situation demands the replacement of self-esteem by the opposite attitude.”5 It is, after all, noteworthy that Vierkandt, the opponent of eudemonism, attributes to subordination effects conducive to happiness. Here Feuerbach’s observation becomes pertinent: “Every instinct is an instinct for happiness.”6

The self-esteem that Vierkandt has in mind is, however, of a peculiar kind. It is, as it were, a by-product of subordination. “Everywhere, acceding to the will of the superior means at the same time that one elevates oneself to his level: subordination means simultaneously an inner sharing of the greatness of the superior.” He cites as an example “the relationship of the servant to his master under patriarchal conditions.”7  In another place Vierkandt again speaks of the “servant who shows off the castle of his master with enhanced self-esteem” because he feels “inwardly at one with his lord, his family, and their splendor.”8

The self-esteem that Vierkandt has in view reveals itself, therefore, as nothing more than the pride of a flunky. Then, of course, there is no wonder that it does not stand in the way of the instinct of subordination. This subordination is tantamount to “unconditional obedience.” The subordinate makes himself “blindly dependent within.” He

submits completely to his superior’s judgment, especially his value judgments: he receives his worth from his superior in that he regulates his conduct according to his superior’s standards and by so doing satisfies his self-esteem. The subordinate is, as it were, absorbed by the superior: he loses his personality, but finds in community with the superior a new one again, which he experiences as his own personality ennobled.9

Vierkandt is able to point with particular satisfaction to the fact that all these instincts are to be found in animals.

In the dog the truly human inner devotion to its master shows itself in an elementary, but very powerful, form, e.g., enlivenment in the master’s presence and the polarization brought about by him in general.

Vierkandt considers as very noteworthy

also the satisfaction of self-esteem shown by a dog and probably by other animals too when they succeed in the performance of a task for which they have been trained, because of the connection of this instinct with the instinct of subordination in the human being.10

Thus, as Vierkandt sees it, human society is, so to speak, already foreshadowed in the relationship of the master to the dog he trains. The relationship of leader and led corresponds to the relationship of master and dog: it is healthy and normal, and it is conducive to the happiness of both, the master as well as the dog.

One cannot argue this point further with Vierkandt because, in his view, the ultimate source of cognition is

phenomenological insight, i.e., what we directly experience personally in ourselves and can convey to our consciousness with apodictic evidence.11

Therefore, we do not doubt that he really has inwardly experienced all this. Indeed, we shall go still further and not deny his qualification to speak from direct personal experience and insight about the “truly human inner devotion of the dog to his master.” But what if someone were to affirm that he had personally experienced and intuited something different? Suppose one chose to call “healthy, normal, and conducive to happiness” not the self-esteem of lackeys and dogs, but that of men? What if one chose to seek the basis of “inner communion” not in the “desire for subordination,” like Vierkandt,12  but in the desire for joint action?

Vierkandt rejects the individualist theory of action because he wants to champion a political program that appears senseless when viewed from the standpoint of scientific economics and sociology. He is unable to support his rejection of the latter except by repeatedly referring to the rationalist, individualist, and atomistic character of everything that does not meet with his approval.13  Rationalism, individualism, and atomism are today condemned by all ruling parties for easily recognizable reasons; and so this mode of argumentation suffices for the sphere in which the official doctrine is accepted. In place of the sciences he attacks without having understood their teachings, Vierkandt provides an arbitrary enumeration and description of innate primary instincts and impulses that he alleges to have experienced and intuited just so and not otherwise, in order to found a political program on a basis that suits his purposes. Here we can disregard all this. What is noteworthy for us is that he who wants to avoid the path taken by the universally valid science of human action can explain the social cooperation of men in no other way than by reference to the working of inborn propensities that lead to association; that is, if he does not prefer to represent it still more simply as a work of God or Nature.

If anyone believes that he can explain every human want, or every class of human wants constructed by him, by correlating with it a particular impulse, instinct, propensity, or feeling, then he is certainly not to be forbidden to do so. Not only do we not deny that men desire, want, and aim at different things, but we start precisely from this fact in our reflections. When science speaks of pleasure, happiness, utility, or wants, these signify nothing but what is desired, wished for and aimed at, what men regard as ends and goals, what they lack, and what, if procured, satisfies them, These terms make no reference whatever to the concrete content of what is desired: the science is formal and neutral with regard to values. The one declaration of the science of “happiness” is that it is purely subjective. In this declaration there is, therefore, room for all conceivable desires and wants. Consequently, no statement about the quality of the ends aimed at by men can in any way affect or undermine the correctness of our theory.

The point at which the science of action begins its work is the mutual incompatibility of individual desires and the impossibility of perfect satisfaction. Since it is not granted to man to satisfy all his desires completely, inasmuch as he can attain one end only by forgoing another, he must differentiate among instincts: he must decide in favor of one thing and against something else; he must choose and value, prefer and set aside—in short, act. Even for one who calls the happiness of subordination desirable, a moment can come in which he has to choose between devotion to the leader and the satisfaction of another instinct, e.g., the instinct for food; as when a republican party at the head of the government threatens monarchist officials with dismissal. Everyone again and again finds himself confronted with a situation in which his conduct—whether it consist in an overt deed, an act of omission, or acquiescence—helps to determine whether or not his goals are attained.

However, a doctrine that rejects rationalism, individualism, and eudaemonism can say nothing about human action. It stops at the enumeration and description of a number of instincts. To be sure, it tells us that men love and hate, that they are garrulous and taciturn, that they are cruel and compassionate, that they are sociable and that they shun society. But it can say nothing about the fact that they act, work, labor, and toil to achieve goals. For one can speak of action only if one starts from the individual, if one takes rationality into consideration, and if one recognizes that the goal of action is the removal of dissatisfaction. If one wants to explain society without reference to the actions of men, the only expedient that remains is to view it as the outcome of mysteriously operating forces. Society is then the result of the instinct of association; it is “inner communion”; it is basic and intrinsic; it is not of this world.

2. Myrdal’s Theory of Attitudes

Still another example may help to show how vain are all objections raised against the atomism, individualism, utilitarianism, and rationalism of the science of action. No less clearly than in the case just discussed, it will be seen here too that attempts to explain human action in terms of such psychological factors as the striving for power are incapable of refuting the conclusions that economics reaches by cogent logical reasoning. Under the guise of nonpartisan criticism of all the social sciences hitherto developed, an effort is made to justify interventionism, a policy whose inexpedience and futility (as seen from the standpoint of the goals that its advocates hope to attain by it) has been demonstrated by economics.

Myrdal thinks one understands

the pathos of the labor movement poorly if one believes that it fights chiefly for higher real wages. Viewed from the standpoint of social psychology, something else is involved here . . . The demands for higher wages, shorter working time, etc. are, of course, important in and of themselves, but viewed more deeply, they are only an expression of far more general strivings for power and demands for justice on the part of a social class which simply feels oppressed. Even if there were no hope of forcing through higher wages, the battle would go on. Even if the workers had reason to believe that a decline in productivity and wages would result, they would nevertheless demand more power and codetermination in the conduct of business. In the last analysis, more is at stake for them than money; their joy of labor is involved, their self-esteem, or, if one will, their worth as men. Perhaps no great strike can be explained merely as a strike for higher wages.14

With this argument Myrdal, of course, believes he has deprived of its importance—from the point of view of the workers’ judgment of the goals of trade unionism—the irrefutable proof provided by economics that trade-union policy can never permanently raise wages for all workers. For whoever knows how to examine the matter “more deeply” or from the standpoint of “social psychology” will realize, he thinks, that in the eyes of the workers organized in unions, what is at issue is by no means the height of wages or a question of money; on the contrary, quite different things are at stake, such as their “joy of labor,” their “self-esteem,” and their “worth as men.”

If this were really so, it would be impossible to understand why union leaders and the socialists of the chair who give them support place so much emphasis on again and again upholding in their public declarations the contention, pronounced untenable by economics, that wages can be raised permanently for all workers by trade unionism; and why they so ardently endeavor to proscribe and silence all who are of a different opinion. The reason for this behavior on the part of union leaders and their literary allies is that the unionized workers expect an increase in their real income. No worker would join a union if he were unable to hope for a wage increase from it, but, on the contrary, would have to reckon with a loss of wages. Even the prospect of being compensated through joy of labor, self-esteem, human worth and the like could not make him a friend of the unions. Union leaders know quite well that the expectation of an increase in income is the one and only factor that has brought the unions into existence and still holds them together.

However, even if Myrdal were right in saying that the unions really do not fight chiefly for higher wages, but rather for other things, the statements of economics on the question of the influence that the combination of workers into trade unions has on the height of wages would remain unaffected. Economics is neither for nor against unions. It seeks only to show how the specific policy of trade unions affects the labor market.

Myrdal’s position is not improved by his avoidance of plain and open speaking. In explaining that the demand for higher wages is “of course, important in and of itself,” he no doubt thinks he has sufficiently protected himself against all criticism. We encounter here the vicious practice on the part of the socialists of the chair of concealing an inadequacy of logic by means of an imprecise and inexact mode of expression. Inasmuch as, in the further course of his argument, Myrdal goes so far as to assert that workers would adhere to trade unions even if they were to discover that this involved a sacrifice of wages, he holds the view that the wage increase—which, in his opinion and in that of all socialists of the chair and union leaders, union policy makes inevitable—is valued by the workers only as an agreeable, but secondary, success of measures directed at the attainment of other goals. However, such a statement makes no contribution whatever toward advancing the discussion of the question whether the employment of union tactics can result in a general and permanent wage increase, which is the only aspect of the matter that has any importance for economic theory and—as all unbiased critics will, of course, admit—in actual practice as well.

Myrdal is familiar with neither the history nor the present state of economics and is therefore fighting against windmills. According to him, economics maintains that only “economic interests” guide human action. By “economic interests” Myrdal understands “the desire for higher income and lower prices.” This, he contends, is an error: “Regrettably—or perhaps fortunately—the motives of human action are not exhausted with the mere recording of economic interests.”15

The economists of an earlier age took the view that there is a definable province of the “economic” and that it is the function of economics to investigate this province. Modern economists adhered to this view for some time, although the line of demarcation between “economic” and “noneconomic” ends must have appeared still less clearly visible in the light of their subjectivism than in that of the objectivism of the classical economists. Even today this view has not yet been given up by everyone. But more and more the realization is spreading that neither the motivations nor the ends of action can be differentiated as economic and noneconomic. What is economic is only the conduct of acting men. Economic action consists in the endeavor to remedy the state of dissatisfaction or, expressed differently, to satisfy wants as far as the scarcity of means allows.

It cannot be maintained that either of these two views saw in the pursuit of economic interests (in the sense in which Myrdal employs this term) the only motive of human action. The older view distinguished between economic and noneconomic goals. According to the modern view, all action is economic. Modern economics makes no distinction among ends because it considers them all equally legitimate, even those that the older view and the popular mode of expression (adopted also by Myrdal) regard as noneconomic. Modern economists do not want valuations to be smuggled into their science. For example, they do not want efforts to obtain “ideal” goods to be considered different in any way from the striving for “material” goods. The fact that frequently a financial gain is eschewed or expenditures are made in order to attain political or other ends, which are usually called noneconomic, is not only not denied, but emphasized.

Myrdal works with a concept of “interest” that he equates with that of “economic interest” and thus with “the desire for higher income and lower prices.” The conduct of men, he maintains, is not determined by interests alone, but by “attitudes.” The term “attitude” is to be understood as “the emotional disposition of an individual to respond in certain ways toward actual or potential situations.” There are “happily,” he adds, “enough men with attitudes which do not at all coincide with their interests.”16  It certainly does not require a book of over three hundred pages to point this out. No one has denied, least of all economists, that there are men who aim at other things besides “higher incomes and lower prices.” Böhm-Bawerk, for instance, explicitly stated that he used the word “well-being” in the broadest sense, in which it does “not embrace merely the self-centered interests of a subject, but everything that appears to him worthy of pursuit.”17  All the arguments advanced by Myrdal against the utilitarianism of economics collapse completely, because he has not understood the fundamental ideas of the modern doctrines he undertakes to criticize.

3. The Critique of Rationalism by Ethnology and Prehistory

Attempts to undermine the “rationalistic” starting point of economic theory by drawing on the research findings of ethnology and the history of primitive peoples also miss the mark.

Eduard Hahn traces the origin of the plow and plow farming back to ancient myths. Tillage with the Plow, he tells us, was originally a ceremony in which the plow represented the phallus of the ox who drew it impregnating mother earth. The wagon, according to him, was not originally an “economic” means of conveyance. On the contrary, it was a sacred implement whose purpose was “to repeat on earth the wanderings of the rulers of fate in heaven.” Only later did “the wagon sink to a commonplace implement of farming.”18

By means of these discoveries, which, to be sure, are by no means uncontested, Hahn thinks he has cut the ground from under the utilitarian position and furnished complete proof of the correctness of his political program, which demands the “re-establishment of an active social aristocracy.”19  ”Modern ethnology,” Hahn believes,

finds itself again and again and again in the strongest opposition to the current view, which, in the most regrettable contradiction of the facts of the real world, is bent on setting out pure utility as the only operative mainspring of all the economic activity of men, and, indeed, of all historical events in general. Gradually, however, it will have to be recognized that the ideal aspect certainly deserves very great consideration; that it is not true for all ages and peoples, as it is said to be for us, the children of the second half of the nineteenth century, that the result of every activity?whether it is a matter of a sack of potatoes or the greatest discovery in philosophy or physics?can be expressed in marks and pfennigs, or, for that matter, in dollars and cents.20

The peoples whose culture Hahn has studied had different ideas of the relationship between cause and effect from those of the men of the nineteenth century. Whereas today we are guided in our conduct by ideas derived from modern chemistry, biology, and physiology, they had notions that we are now accustomed to call beliefs in magic and myths. They were, says Hahn, imbued with the idea that

the life of the vegetable or the animal kingdom could be influenced by efficacious rites.21

The oldest agricultural botany, he further maintains, also certainly stemmed from the idea that

before one could demand something of the land, something would have to be done to further the growth of the vegetable kingdom; one had to have first contributed something to it.22

Thus, Hahn himself admits that the primitive husbandman practiced their rites because of their supposed utility and their anticipated results. Their customs and magical rites were, according to Hahn’s own presentation, actions consciously aiming at ends. When we call their technology “magic” and ours “scientific,” all we are saying is that the fundamental orientation of men’s conduct is the same in both cases and that the difference is determined by the disparity in their concrete ideas concerning the relationship between cause and effect. These mythological views saw a causal relationship between, for example, the nudity of the plowman and a rich harvest, and between many other customs that are offensive to us today and the fertility of the Soil;23  and rites were performed in accordance with these ideas in order to ensure the success of agricultural labor. But surely no one can find any support in all this for the statement that men of primitive times differed from us in that the mainspring of their actions was not utility, but idealism. Obviously the result of economic activity could not be computed in marks and pfennigs in an age that was not yet familiar with the use of money. But what the men of primitive times strove for, what they valued alone, and what they sought to attain precisely by means of their rites, religious acts, exorcisms, prayers, and orgies was the satisfaction of the “common” exigencies of life: the need for food, clothing, shelter, health, and safety. For the other things we value today they would have had no understanding?not even for “the greatest discovery in philosophy or physics.”

The progress of civilization, Frobenius thinks, derives not from “need” and “uneasiness,” but from “ideals.” Among other things the history of cultivation with the hoe proves this.

The first step was apparently a gathering of grain that grew wild. Out of thankfulness, and in order to propitiate mother earth, who was wounded by the grain harvest, the custom arose, as an ideal, of again restoring grain to her, the fruits of which flowed back not so much to the profane life, but as holy testimony of sacrifice. Not until a later age did cultivation with the hoe assume a more and more profane and rational character . . . Only when provident causality let ideals atrophy, when sober facts came to dominate the spirit, did the practical, expedient utilization of the “discovery” of cultivation with the hoe appear as profane farming.24

It may well be true that cultivation with the hoe and the plow arose as ritual acts out of a technology of magic and mythology and that later, after the inefficacy of the rites was realized, these methods of tillage were retained because their suitability came to be recognized as a result of the knowledge of agricultural botany that had been acquired in the meantime. This discovery may be welcomed as a very interesting contribution to the history of technology and the application of technological knowledge. Yet for the purposes of the subject under discussion it tells us nothing beyond the fact that the technological notions of primitive ages were different from ours. It would be impermissible to infer from this that the action of men of distant times and lands was categorially different from the action of modern men. Berthold Schwarz intended to make gold, and in attempting to do so is said to have discovered the preparation for gunpowder. Columbus set sail to seek a sea route to the Indies and discovered America. Can one therefore maintain that these two men acted in ways fundamentally different from the way we act today? It has never been denied that human action does not always attain the ends it has set for itself and occasionally has results that would have appeared worth aiming at if they had been known earlier.

When the husbandman of remote antiquity sought to increase the produce of their land by means of symbolic rites, their action was based on the prevailing “technological” notions of their time. When today we proceed differently, our action conforms to the technological notions prevailing at the present time. He who considers them erroneous might attempt to uncover their errors and replace a useless theory by a more suitable one. If he is unable to do so, he should not criticize the procedure of those who work for the dissemination of the knowledge of modern agricultural technology. It is futile to criticize statements such as “the shortsighted rationalism of the nineteenth century regarded the acts and dispensations of the old ritual . . . simply as superstition and thought it was to be pushed aside by instruction in the public schools.”25  If one goes through the long list of rites—not very commendable from the standpoint of present-day sentiment that Eduard Hahn has assembled in his writings on the basis of astonishingly extensive research, one finds scarcely any whose elimination would be regretted.26  For what purpose should the empty forms of a technology whose fruitlessness no one can deny be retained?

In the behavior of men we can distinguish only two basic forms, between which there is a sharp conceptual division: unconscious behavior, or vegetative reaction, and conscious behavior, or action. All action, however, is necessarily in accord with the statements of the a priori theory of human action. Goals change, ideas of technology are transformed, but action always remains action. Action always seeks means to realize ends, and it is in this sense always rational and mindful of utility. It is, in a word, human.

• 1Vierkandt, Gesellschaftslehre (2nd ed.; Stuttgart, 1928), p. 23.
• 2Ibid.
• 3Op, cit., p. 37.
• 4Kölner Vierteljahrschefte für Soziologie III, (1923), 179.
• 5Vierkandt, op. cit., p. 61.
• 6Feuerbach, Sämtliche Werke (republished by Bolin and Jodl, Stuttgart, 1907), X, 231. “Happiness,” says Feuerbach (ibid.), is “nothing but the healthy, normal condition of a being.”
• 7Vierkandt, op. cit., p. 48.
• 8Vierkandt, op. cit., pp. 31 f.
• 9Vierkandt, op. cit., p. 47.
• 10Vierkandt, op. cit., p. 60.
• 11Vierkandt, op. cit., p. 41.
• 12Vierkandt, op. cit., p. 63.
• 13Cf. also Vierkandt’s article “Kultur des 19. Jahrhunderts und Gegenwart,” Handwörterbuch der Soziologie, pp. 141 ff.
• 14Cf. Myrdal, Das politische Element in der nationalökonomischen Doktrinbildung, translated by Mackenroth (Berlin, 1932), pp. 299 f. [Translator’s note: The quotations are from the German edition of Myrdal’s book, published under the title cited. In the English-language edition, which, as the title indicates, was translated from the German by Paul Streeten and published by Routledge and Kegan Paul, Ltd. in London in 1953, the quoted passages, perhaps in consequence of Mises’s critique in this text, have been considerably weakened.]
• 15Myrdal, op. cit., p. 299.
• 16Myrdal, op. cit., p. 299.
• 17Böhm-Bawerk, Kapital und Kapitalzins (4th ed.; Jena, 1921), Part II, Vol. I, p. 236, footnote.
• 18Hahn, Die Entstehung der Pflugkultur (Heidelberg, 1909), pp. 40 ff., 105 ff., 139 ff., 152 ff.; Frobenius, Paideuma, Umrisse einer Kultur und Seelenlehre (Munich, 1921), pp. 72 f.
• 19Hahn, Die Entstehung der wirtschaftlichen Arbeit (Heidelberg, 1909), pp. 102 ff.
• 20Hahn, Die Entstehung der Pflughultur, p. 63.
• 21Ibid., p. 86.
• 22Ibid., p. 87.
• 23Ibid., p. II 7 ff.
• 24Cf. Frobenius, Paideuma, pp. 70 ff.
• 25Cf. Hahn, Die Entstehung der Pflugkultur, p. 87.
• 26A few examples from a compilation by Hahn (Die Entstehung der Pflugkultur, pp. 118 ff.): sacred prostitution; lewd jokes, especially on the part of women, at agricultural festivals; the singing of licentious songs by the most eminent women of Bautzen; running around the fields naked by Wendish female flax-workers until as late as 1882.