Economics

Economics, according to a classical definition, is the social science that studies the production, distribution, and consumption of goods and services. The term economics comes from the Wikipedia:Ancient Greek oikonomia ("management of a household, administration") from oikos ("house") and nomos ("custom" or "law"), hence "rules of the house(hold)".

For the Austrian school, this definition is not as much incorrect as it is too constricting. Economical principles apply to more than one specific kind of human action. Mises popularized the term for a new science, praxeology: "The economic or catallactic problems are embedded in a more general science, and can no longer be severed from this connection. No treatment of economic problems proper can avoid starting from acts of choice; economics becomes a part, although the hitherto best elaborated part, of a more universal science, praxeology."

According to Rothbard: 'the entire Austrian economic theory is the working out of the logical implications of the fact that humans engage in purposeful action.'

Austrian School economists advocate strict adherence to methodological individualism – analyzing human action from the perspective of individual agents. Proponents of this method, praxeology, argue that the only means of arriving at a valid economic theory is to derive it logically from basic principles of human action. Proponents of this method hold that it allows for the discovery of fundamental economic laws valid for all human action. Alongside praxeology, the school has traditionally advocated an interpretive approach to history to address specific historical events.