Economics or catallactics, the only branch of the theoretical sciences of human action that has up to now been elaborated, views the collectives as creations of the cooperation of individuals. Guided by the idea that definite ends sought can be attained either better or only by cooperation, men associate with one another in cooperation and thus bring forth what is called groups or collectives or simply human society.

In the political sphere the violent overthrow of the precapitalistic methods of government resulted in the complete abandonment of the feudal concepts of public law and the development of a new constitutional doctrine with legal concepts and terms unknown before.

One of the characteristics of the market economy is the specific way in which it deals with the problems offered by the biological, moral, and intellectual inequality of men.

In the precapitalistic ages the superior, i.e., the smarter and more efficient individuals, subdued and enthralled the masses of their less efficient fellows. In the status society there are castes; there are lords and there are servants. All affairs are managed for the sole benefit of the former, while the latter have to drudge for their masters.

The popular ideas concerning the methods the economists employ or ought to employ in the pursuit of their studies are fashioned by the belief that the methods of the natural sciences are also adequate for the study of human action. This fable is supported by the usage that mistakes economic history for economics. A historian, whether he deals with what is called general history or with economic history, has to study and to analyze the available records. He must embark upon research.

Public opinion still labors under the failure of classical economics to come to grips with the problem of value. Unable to solve the apparent paradox of valuation, the classical economists could not trace the chain of market transactions back to the consumer, but were forced to start their reasoning from the actions of the businessman, for whom the valuations of the buyers are a given fact. The conduct of the businessman in his capacity as a merchant serving the public is pertinently described by the formula: Buy in the cheapest and sell in the dearest market.

A popular opinion considers economics as the science of business transactions. It assumes that economics is in the same relationship to the activities of a businessman as is the discipline of technology taught at schools and expounded in books to the activities of mechanics, engineers, and artisans. The businessman is the doer of things about which the economist merely talks and writes.

The worst enemy of clear thinking is the propensity to hypostatize, i.e., to ascribe substance or real existence to mental constructs or concepts.

No sensible proposition concerning human action can be asserted without reference to what the acting individuals are aiming at and what they consider as success or failure, as profit or loss. If we study the actions of the individuals, we learn everything that can be learned about acting, as there are, as far as we can see, in the universe no other entities or beings that, dissatisfied with the state of affairs that would prevail in the absence of their interference, are intent upon improving conditions by action.

The authors who think that they have substituted, in the analysis of the market economy, a holistic or social or universalistic or institutional or macroeconomic approach for what they disdain as the spurious individualistic approach delude themselves and their public. For all reasoning concerning action must deal with valuation and with the striving after definite ends, as there is no action not oriented by final causes.

The natural conditions of their existence enjoined upon the nonhuman ancestors of man the necessity of mercilessly fighting one another unto death. Inwrought in the animal character of man is the impulse of aggression, the urge to annihilate all those who compete with him in the endeavors to snatch a sufficient share of the scarce means of subsistence that do not suffice for the survival of all those born. Only for the strong animal was there a chance to remain alive.