History: Difference between revisions
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'''History''' is the | '''History''' is the study of past human action in its individuality: what particular people did, in particular circumstances, for particular reasons. Austrian economists give history an unusually precise place, because the boundary between history and [[economics]] is exactly where the [[Austrian School]] parted company with the rest of the profession. | ||
==Why history cannot yield economic laws== | |||
The natural sciences establish laws by observing constant relations between measurable quantities. [[Ludwig von Mises]] argued that human action exhibits no such constant relations. A quantity measured in the historical record, such as the effect of a tax rise in one country in one decade, is the joint product of countless valuations that were never repeated and never will be. There is no way to hold the other conditions fixed, and no experiment to run. | |||
It follows that economic history can neither prove nor refute an economic proposition on its own. Statistics of the past are economic history, not economics.<ref name="ha2">[[Ludwig von Mises]]. [https://freecapitalists.org/books/human-action/read/chapter-ii-the-epistemological-problems-of-the-sciences-of/ II. The Epistemological Problems of the Sciences of Human Action], ''[[Human Action]]''.</ref> This is why [[praxeology]] is held to be prior to history: the theory is what makes the record intelligible, rather than something distilled out of it. | |||
The claim is easy to overstate and often is. Mises did not hold that history is uninformative or that economists should ignore it. He held that a historical episode has to be interpreted through theory the historian brings to it, and that a historian who denies having any theory is using one unexamined. | |||
==Methodological dualism== | |||
The underlying position is '''methodological dualism''': the methods appropriate to studying purposeful action differ in kind from those appropriate to studying matter, not because human beings are exempt from causality but because we have no knowledge of how mental states arise from physical ones, and must therefore start from the fact that people act for reasons.<ref name="th_intro">[[Ludwig von Mises]]. [https://freecapitalists.org/books/theory-and-history-an-interpretation-of-social-and-economic-evolution/read/introduction-1-methodological-dualism/ Introduction: Methodological Dualism], ''Theory and History''.</ref> | |||
Mises set this out at length in ''[[Theory and History]]'' (1957), which remains the fullest Austrian statement on the subject.<ref name="th">[[Ludwig von Mises]]. [https://freecapitalists.org/books/theory-and-history-an-interpretation-of-social-and-economic-evolution/ ''Theory and History: An Interpretation of Social and Economic Evolution''] (1957).</ref> | |||
==Thymology and understanding== | |||
If theory supplies the general laws, something else must account for the particulars: why ''these'' people valued ''that'' outcome at ''that'' moment. Mises called this '''thymology''', the knowledge of human valuations and reactions that everyone acquires by living among other people and that the historian applies deliberately.<ref name="th12">[[Ludwig von Mises]]. [https://freecapitalists.org/books/theory-and-history-an-interpretation-of-social-and-economic-evolution/read/chapter-12-psychology-and-thymology-1-naturalistic/ Chapter 12: Psychology and Thymology], ''Theory and History''.</ref> | |||
Thymological judgement is not arbitrary, but neither is it demonstrable in the way a theorem is. Two competent historians working from the same documents can weigh the relevance of the several causes differently and neither be convicted of error. Mises treated this as a permanent feature of historical work rather than a defect to be engineered away, and it is the ground of his objection to attempts to make history predictive.<ref name="th13">[[Ludwig von Mises]]. [https://freecapitalists.org/books/theory-and-history-an-interpretation-of-social-and-economic-evolution/read/chapter-13-meaning-and-use-of-the-study-of-history-1-the/ Chapter 13: The Meaning and Use of the Study of History], ''Theory and History''.</ref> | |||
==The Methodenstreit== | |||
The dispute has an origin. In the 1880s [[Carl Menger]] and Gustav von Schmoller, leader of the German Historical School, argued over whether economics had any theoretical content at all. Schmoller's school held that economic knowledge could only be gathered inductively from the historical record of each nation and epoch; Menger held that there were universal laws of value and exchange that no amount of historical detail could establish or overturn. | |||
The quarrel gave the Austrian School its name, which began as a term of derision aimed at Menger's circle in Vienna by his German opponents. Its substance is still live wherever economics is treated as an empirical science on the model of physics. | |||
==History against historicism== | |||
Mises distinguished history from '''historicism''', the doctrine that there are laws of historical development which determine the sequence of social forms. Marxian stage theory is the leading example, and Mises rejected it on the ground that a law of succession would have to be derived from something, and no method exists for deriving one.<ref name="th10">[[Ludwig von Mises]]. [https://freecapitalists.org/books/theory-and-history-an-interpretation-of-social-and-economic-evolution/read/chapter-10-historicism-1-the-meaning-of-historicism/ Chapter 10: Historicism], ''Theory and History''.</ref> | |||
The related target is '''scientism''', the transfer of methods that work in the natural sciences to subject matter where the required constants do not exist. [[F.A. Hayek]] made this the theme of ''The Counter-Revolution of Science'', arriving at conclusions close to Mises's from a different direction. | |||
==Austrian historical writing== | |||
The methodological position did not make Austrians shy of writing history. [[Murray N. Rothbard]] produced a four-volume history of colonial America (''Conceived in Liberty''), a two-volume history of economic thought, and ''America's Great Depression'', which applies [[Austrian Business Cycle Theory]] to a single episode. That last book is the clearest illustration of the method in practice: the theory is not tested against 1929, it is used to sort which of the many things happening in 1929 mattered. | |||
==See also== | |||
* [[Praxeology]] | |||
* [[Economics]] | |||
* [[Austrian School]] | |||
* [[Carl Menger]] | |||
* [[Methodological individualism]] | |||
* [[America's Great Depression]] | |||
==References== | ==References== | ||
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==Links== | ==Links== | ||
* [https://freecapitalists.org/books/theory-and-history-an-interpretation-of-social-and-economic-evolution/ Theory and History] by Ludwig von Mises, 1957 | |||
* [https://freecapitalists.org/books/human-action/read/chapter-ii-the-epistemological-problems-of-the-sciences-of/ The Epistemological Problems of the Sciences of Human Action] by Ludwig von Mises (chapter II of [[Human Action]]) | |||
* {{wplink}} | * {{wplink}} | ||
[[Category:Concepts]] | [[Category:Concepts]] | ||
[[Category:History]] | [[Category:History]] | ||
Latest revision as of 13:10, 16 August 2026
History is the study of past human action in its individuality: what particular people did, in particular circumstances, for particular reasons. Austrian economists give history an unusually precise place, because the boundary between history and economics is exactly where the Austrian School parted company with the rest of the profession.
Why history cannot yield economic laws
The natural sciences establish laws by observing constant relations between measurable quantities. Ludwig von Mises argued that human action exhibits no such constant relations. A quantity measured in the historical record, such as the effect of a tax rise in one country in one decade, is the joint product of countless valuations that were never repeated and never will be. There is no way to hold the other conditions fixed, and no experiment to run.
It follows that economic history can neither prove nor refute an economic proposition on its own. Statistics of the past are economic history, not economics.[1] This is why praxeology is held to be prior to history: the theory is what makes the record intelligible, rather than something distilled out of it.
The claim is easy to overstate and often is. Mises did not hold that history is uninformative or that economists should ignore it. He held that a historical episode has to be interpreted through theory the historian brings to it, and that a historian who denies having any theory is using one unexamined.
Methodological dualism
The underlying position is methodological dualism: the methods appropriate to studying purposeful action differ in kind from those appropriate to studying matter, not because human beings are exempt from causality but because we have no knowledge of how mental states arise from physical ones, and must therefore start from the fact that people act for reasons.[2]
Mises set this out at length in Theory and History (1957), which remains the fullest Austrian statement on the subject.[3]
Thymology and understanding
If theory supplies the general laws, something else must account for the particulars: why these people valued that outcome at that moment. Mises called this thymology, the knowledge of human valuations and reactions that everyone acquires by living among other people and that the historian applies deliberately.[4]
Thymological judgement is not arbitrary, but neither is it demonstrable in the way a theorem is. Two competent historians working from the same documents can weigh the relevance of the several causes differently and neither be convicted of error. Mises treated this as a permanent feature of historical work rather than a defect to be engineered away, and it is the ground of his objection to attempts to make history predictive.[5]
The Methodenstreit
The dispute has an origin. In the 1880s Carl Menger and Gustav von Schmoller, leader of the German Historical School, argued over whether economics had any theoretical content at all. Schmoller's school held that economic knowledge could only be gathered inductively from the historical record of each nation and epoch; Menger held that there were universal laws of value and exchange that no amount of historical detail could establish or overturn.
The quarrel gave the Austrian School its name, which began as a term of derision aimed at Menger's circle in Vienna by his German opponents. Its substance is still live wherever economics is treated as an empirical science on the model of physics.
History against historicism
Mises distinguished history from historicism, the doctrine that there are laws of historical development which determine the sequence of social forms. Marxian stage theory is the leading example, and Mises rejected it on the ground that a law of succession would have to be derived from something, and no method exists for deriving one.[6]
The related target is scientism, the transfer of methods that work in the natural sciences to subject matter where the required constants do not exist. F.A. Hayek made this the theme of The Counter-Revolution of Science, arriving at conclusions close to Mises's from a different direction.
Austrian historical writing
The methodological position did not make Austrians shy of writing history. Murray N. Rothbard produced a four-volume history of colonial America (Conceived in Liberty), a two-volume history of economic thought, and America's Great Depression, which applies Austrian Business Cycle Theory to a single episode. That last book is the clearest illustration of the method in practice: the theory is not tested against 1929, it is used to sort which of the many things happening in 1929 mattered.
See also
- Praxeology
- Economics
- Austrian School
- Carl Menger
- Methodological individualism
- America's Great Depression
References
- ↑ Ludwig von Mises. II. The Epistemological Problems of the Sciences of Human Action, Human Action.
- ↑ Ludwig von Mises. Introduction: Methodological Dualism, Theory and History.
- ↑ Ludwig von Mises. Theory and History: An Interpretation of Social and Economic Evolution (1957).
- ↑ Ludwig von Mises. Chapter 12: Psychology and Thymology, Theory and History.
- ↑ Ludwig von Mises. Chapter 13: The Meaning and Use of the Study of History, Theory and History.
- ↑ Ludwig von Mises. Chapter 10: Historicism, Theory and History.
Links
- Theory and History by Ludwig von Mises, 1957
- The Epistemological Problems of the Sciences of Human Action by Ludwig von Mises (chapter II of Human Action)
- History at Wikipedia