 I should tell you, I don't have a very loud voice, so in case you can't hear me, please let me know. I remember my friend Bob Nozick once started a lecture by saying, can everybody hear me in the back? And somebody yelled out, we can't hear you in the front. And he said, well, go to the back where you can hear me. And I have today to talk to you about the more philosophical aspects of the subject. They remind me my friend, Father James Sadowski, who taught philosophy at Harvard. He was a great friend of Murray Rothbard. Used to tell his classes, the word philosophy comes from the Greek word philosophia, which means philosophy. I should tell you also, if you want a very quick understanding of praxeology and the issues I'll be discussing in this lecture, sort of a painless way to acquire this such knowledge is to read the preface. It's just a few pages that Murray Rothbard wrote to Mises' theory and history in the reissue of that book by the Mises Institute. He covers all the essential points in a very easy to understand fashion, a much easier presentation than you'll be getting in this lecture, I should say. So Mises considered economics part of a general science of human action. In doing that, it was a very different definition of economics from that common in the 19th century, where economics was sometimes defined as the science of wealth. So what the notion of praxeology is is that economics isn't limited to just one particular kind of action. It's, say, money making. It covers all human action. And Mises says that economics is the best developed branch of praxeology. It's funny, people will always talk about possible other branches of praxeology. Sometimes people will refer to a theory of violent action or theory of games where that's understood in a different sense from the mathematical theory of games. But nobody ever really comes up with any of the other branches. So economics is really pretty closely the same as praxeology. Sometimes people use the word catalactics to mean economics involving exchanges, particularly money exchanges. As you will have already gathered from the previous two lectures, if you didn't know this already, the method of used in praxeology is quite different from that used in mainstream economics. Say the economics you would get if you were taking a class in economics at one of the major universities. And one thing I'll be discussing in the lecture is what are some of the differences. In praxeology, we begin with some slight difference between Mises and Murray Rothbard here, but it doesn't really amount to that much. From the concept of action or the axiom that human beings act, now what do we mean by action? It's any kind of behavior with a purpose, any time we use a means to achieve an end. One thing very important to understand when we talk about action, we're talking about phenomena that take place in the world. Sometimes people have a picture because praxeology is a deductive science, as I'll be talking about. They think, well, if it's deductive, that means it's somehow in your mind, and then they'll have a problem. How do we know if it's in my mind? How do we know it's out there in the world? But what we're talking about in praxeology is not various ideas or concepts that we have, but the actions what's there in the world. And this will normally involve a movement of someone's body. Say, I want some water, so I pick up the bottle of water, and I drink from it. So I had a means. I wanted to satisfy my thirst, so I had the bottle of water. It was the means. And then I drank, so that's use of means to achieve an end. Now as I say, normally this will involve, action involves movement of the body, but it doesn't have to. Now probably you're thinking there, well, you're thinking of a case where somebody is just waiting, and you read that counts as action also, but there are other cases as well. For example, suppose I were running a meeting, and I said there was a motion. Somebody proposed something like let's lynch the lecture, and then I say all those in favor of the motion please signify by remaining seated. So you've all remained seated, so you've performed the action of voting in favor of lynching me. So see, this would be a case where you can act without moving your body, but most cases of action aren't like that. So from this idea of action or the axiom that human beings act, plus a few supplementary postulates, the rest of praxeology is deduced. The supplementary postulates are there's a disutility of labor. Normally when we labor in the sense we're exerting energy to achieve some end that we want, we get tired after a while. We don't want to continue the activity. And this is something that isn't something that we can just know by thinking about it. It's just added as a supplementary posture. Also, there's a variety of goods and services would be added to the action axiom. And from this, the science of praxeology is deduced. Now, when we talk about deduction, it's very important that we understand what's meant by that. For those of you who've taken mathematical logic, of course, in that you think, well, the deduction that we do in praxeology doesn't at all resemble deduction as you learned it in these courses. Because in mathematical logic, we have everything set out formally. We're having symbols that we have. We have formal proofs of these various theorems by deduction rules. But this isn't what's taking place in praxeology. Praxeology deduction is what's called material deduction where we're thinking about what's involved in the concept of action. So at each step, we have to understand what we're saying. And we have a knowledge of what action is. And then we're trying to draw out from this knowledge what's involved in action. This is what's meant by deduction. It's not a process where we can just follow certain formal rules. And then in that kind of deduction, we're really not interested in interpreting each step of a deduction. As long as we know what's applying the rules properly, we just want to know the conclusion. Then we can get an interpretation of that. So the steps are just mechanical ways of getting to the conclusion. But in praxeology, it's different. We have to understand every step so we know why each step is true. Here is a few examples of what's meant by deduction in the sense of drawing out what is involved in our concept of action. One I've given already, every action uses means to achieve an end. And every action is a choice between alternatives. One thing very important here, which is very different from mainstream classical economics, is that the alternatives that the chooser and the actor is considering, the various preferences that he's ranking, exist only when the actor is choosing. And neoclassical economics involves very often setting up very elaborate preference scales. And they'll have all possible combinations of choices that people will make covering all sorts of alternatives. But in praxeology, we're only interested in the alternatives that an actor is considering at a particular moment. And another difference here that is very much related to one I've just mentioned is that in neoclassical economics, there are various rules that people will give the sort of requirements for rational preferences. For example, one is that preferences have to be transitive. For example, I shouldn't have this preference ordering. I prefer A to B, B to C, and C to A. That would be intransitive preference. So in neoclassical economics, that's considered an irrational set of preferences. But we don't have that in Austrian economics. Mises has a discussion of that in human action somewhere around 105 or so. He says, we don't use the have the transitivity axiom. So that's a big difference. Another example would be one in neoclassical economics. They have what's called a certain if you have a choice between two options and you prefer A to B. And then a third option is introduced that shouldn't make you change your preference between A and B. Example this violates a story about a waitress who said to the customer, you have a choice between apple pie and peach pie. The customer said, well, I'll take apple pie. So then a few minutes later, the waitress came back and said, I forgot to mention, we also have cherry pie. So he says, oh, well, in that case, I'll take a peach pie. So that would violate this axiom of independence of irrelevant alternatives. So again, that isn't used in Austrian economics. It's a very minimal conception use of preferences. Only the choices that are an actor is actually considering are the ones that we're interested in. And further point is that the actor will always choose his highest value alternative. Say, if you're here listening to this lecture that indicates you preferred doing that to doing something else, you might have regret the choice now that that's another matter. But that was your preference. Now, some people say, given up, Jack says, oh, well, you're just defining the highest value preference as the one you, in fact, choose. So you're not really saying anything. You're just saying, you choose the one you choose. But that isn't right. The claim is you have a certain ranking of your preferences. And in fact, you will choose the one that's highest. It's not that you're defining the highest one as the one you choose. It's making the substantive claim. And I should say, there's some people who don't accept that. Some philosophers talk about strong cases of weakness of will, kind of strong weakness of will. It's kind of an odd term. But they would deny that. They would say it makes sense to say, sometimes you don't choose the one you value the highest. But in Austrian economics, we're denying that strong weakness of will is possible. You always will choose your highest value preference. Now, one thing that was covered in Joe Salerno's lecture, but it's very important to go over it again, is a means is whatever an actor thinks will help him realize his goal. So it doesn't matter if the means won't work, if, say, you have an enemy and you think that making a small doll of that person and sticking pins in it will cause that person harm, then you're doing that as a means to the end of causing that person harm, even if that's not an effective way of doing. So of course, for all I know, it might actually be an effective way of doing harming someone. I've never tried it. You always knew things you can try out. But it's regardless of, again, regardless of how one might think that the actor's choice, that's considered a rational action. He's using what he thinks as a means to attain his goal. We could have cases where, say, you might think there's something wrong with the something peculiar about the person's end, like supposing somebody decides to think he's the emperor Napoleon and decides to write pamphlets letting people know that he's the emperor Napoleon. That would still count as an action in the Austrian sense, even if you would think, well, the person's goal is based on false information, the false belief that the person is the emperor Napoleon. It's still action. So as Mises says in Epistemological Problems of Economics, he says, in dealing with price economics does not act what things are in the eyes of other people, but only what they are in the meaning of those intent on getting them. So it's a very subjective view of what preferences are. And what action is. It's whatever the actor regards means to achieve his end. And economics doesn't make judgments about what the end is, say, if that's what somebody wants. That's just accepted, because if we're trying to explain someone's action, what's important is what are the goals, what is the end that the person has, and what are the means that the person regards appropriate to attain those ends. To go on a bit with this, when we're trying to explain action, I say we're concerned with what the actor prefers. So economics isn't a normative discipline. It doesn't tell you what you should choose. It's saying people choose certain means to achieve an end, but it doesn't say you're right or wrong to want something. Say if somebody wants to devote his life to eating as much ice cream as he possibly can. Practicality wouldn't say that's either a good or bad choice of end. It would just say that's what the person has chosen. So in explaining the action, that's what we're considering. Now, it doesn't follow from that that there aren't any such things as objective judgments of value. Somebody could hold there are objective judgments and value, but it's just that there aren't involved in economics. Mises took the view that there weren't objective judgments of value. All that there are are subjective preferences that that's all there is to it. But that view of his certainly has arguments for that view. That is a philosophical view. That isn't part of praxeology or economics. Somebody could hold. It's just that in economics, we don't make such judgments. Now, when I said that economics doesn't make judgments evaluate the values that people hold, it wasn't entirely true. It's one of quite a number of false statements you'll find in this lecture. That was supposed to be a joke. But yes, you know, I always feel sometimes it's I always at this point of people don't laugh at my jokes, but much worse than that is if people laugh at what I intend as serious comments that's happened on occasion. So the way that what I said wasn't entirely true is that economics doesn't evaluate ultimate ends. If someone says, well, here's what I want. I don't have any reason for this. This is it. This is what I want. I just want to eat as much ice cream as possible. Economics, praxeology couldn't say you shouldn't have such an end. But what praxeology could say is if you think that something is a means to achieve a certain end, we can evaluate that. We could say, say if you thought eating as much ice cream as possible as a way to maximize your resistance to disease, that would be a statement we could evaluate. Now, when in praxeology, what we're interested in is not particular actions that people do not think of like you're coming to this lecture or you're eating ice cream, but what's involved in any action? What could we call the form of the action as opposed to the matter of the action? What is it about behavior that's required to make an action? And so we're considering the form what's involved in any action. And praxeology, in trying to answer that question, what's the form of an action? Doesn't make quantitative claims about action. For example, suppose we say lowering the price of a good while other things being equal result an increase in quantity demanded of the good. Praxeology couldn't tell you how much of an increase there will be. It'll just say there'll be an increase. Mises takes a view. In human action, there aren't any constants. There aren't any things that can be measured so we could come up with numerical laws about action. We could just have general claims about what is the form of an action. A key principle of praxeology is that only individuals act. Say we could talk about each of you coming to this lecture, but we couldn't talk in the same way of the group of you, the people in the audience listening to the lecture unless that was analyzed in terms of each person here listening to the lecture. We say the group you're all listening to the lecture, the group is listening. That would just be analyzed as each individual is listening. So it's only the individuals are acting. Now, sometimes methodological individualism is misunderstood as the more radical claim that nations and classes don't exist. But that isn't right. We say, for example, the US declared war on Japan on December 8th, 1941. That's to be analyzed in terms of certain people. President Roosevelt gave a speech to Congress and various people in Congress voted a resolution of war. And after that, various other people did various things. So that would be what meant by the US declared war on Japan. We certainly wouldn't be a good way of thinking there's no such thing as the United States or no such thing as Japan. Now, you might think this principle that only individuals act seems obvious, but there are people who've denied it. And at the time, Mises was writing human action. Those people were more prominent than they are. Now, for example, there was a professor at University of Vienna who was a very big enemy of Mises named Ottmar Spahn. And he said, it's the group that's primary, not the individual. So it's the group that's acting. What Mises was very concerned to argue against that. Now, as the start of the lecture, I mentioned that press theology is using a different method from the ones that's used in mainstream economics. And the way that it's different is in mainstream economics, they follow a method that's like that used in the physical sciences. So what's done is that the economists will come up with a formal model that will have certain axioms, where axiom is used very differently from praxeology, where praxeology, an axiom of action is something that's claimed to be true. But in axiom is used in mathematics, it's just a starting point. You're not claiming that the axiom is true. It's just your drawing. You have certain axiom. You have a formal deductions from that. And then you have testing to see whether what you deduce, your model, is correct. So you see the extreme difference between the Austrian method and the mainstream. And the mainstream is, the Austrian method is you're at every step, you know what you're claiming is true. In the mainstream method, you're deducing the propositions formally, and then you test them empirically. So the mainstream supporters say, well, the reason we should proceed in this way where you come up with a certain formal model and testing is that that's the way science has progressed since the scientific revolution that the view is, well, up until the 16th century, really, people were just trying to speculate about the natural world just by following Aristotle or just trying to deduce what the nature of motion was just by thinking about it. But that wasn't very successful until we started getting Galileo and others who were actually performing experiments. Knowledge has really progressed this tremendously. I don't think that's really such an accurate picture of science. But regardless of that, even if it were, the Austrian view would be, in economics, it isn't like the physical sciences. In the physical sciences, say, we're looking at objects externally. Say, if we see, look at two physical particles in motion, all we can do is look at them and see, do experiments, see what happens. But in human action, we know action from the inside since we ourselves are acting. So we have a different way of understanding based on our own knowledge of action. We know what it is to act in a way that we don't know what would be the case with the physical particles. And say, if you have an experiment where you roll a ball down an inclined plane, you really won't know what's going to happen until you see what it does. You could have a deduction of what you think will happen. You'll have to test it out. But human action isn't like that. Now, supposing there is a problem that the supporters of this mainstream view will have, if they claim that their method, that's to say, the one that you start off with a certain model and then test it out, they say, that's the only way you can attain knowledge. Now, getting to a problem is that that claim itself, that's to say, this is the only way you can get knowledge, is a philosophical claim. It isn't itself the product of modeling and testing. So how do they know? It would seem, how do they know this claim is true if it is what they say is to get knowledge, you have to model things and test them. But that wasn't modeled and tested. So how are they supposed to know that? I think that sometimes people will make, in the science is very often, people will make claims about certain philosophical points that they think are scientific, but they're actually not. So supposing we don't think that the mainstream supporters of the scientific, so-called scientific method have made out a good case. Now we come to the key question, how do we know that the principles of praxeology are true? It isn't say just because the Mises says so and Rothbard says, so how do we know that what you're learning this week really is true? And this question has led to a lot of confusion, but I'm gonna suggest there's a very easy answer. I think sometimes in philosophy, there's a tendency to wanna come up with complicated answers when we don't need them. I'll give some examples of that a bit later, but the matter is quite simple, is that the action action is something that's obviously true. As soon as we understand it, we grasp it, it's true. We don't need to get support from it from other things. It isn't the only such obviously true statement, for example, others might be, I have a body, the earth has been, other people exist, or the earth has been around a lot longer than I am, or the earth is larger than I am. These are obviously true statements. They're not ones that we have to subject to further testing to find out whether they're true. Sometimes in philosophy, these obviously true statements are called Moorian facts after the great British philosopher, Gene Moore, who emphasized facts of this kind, a great deal in his philosophical work, working a very famous paper called, he said, how can we prove there's an external world? He said, well, I'm holding up one hand here, I'm holding up another hand, so there are two hands, therefore there's an external world. So what he's doing there, he's appealing to certain obvious facts as something that's not subject to further challenge or required testing. So it's similar in praxeology, the axiom that human beings act is just something that's obviously true. So these obvious truths can be known to be true just by thinking of them, and they can't be overthrown by further observation. It isn't that, say, something's going to come up in the future to show that human beings never did act. This was all a false claim. All the facts are in, it isn't up for further testing. So this is one way of defining a priori truth, one that is not subject to further testing. It's known to be true, that's all there is to it. Some philosophers, such a very famous American philosopher, W. V. O. Kwai, who claimed in a paper in 1951 Two Dogmas of Empiricism that there aren't any a priori truths. He thought everything is subject to further testing, but I don't think he's really come up with good reasons for thinking that, he said everything is, the world faces experience as a whole when he thought we can't single out particular propositions that are never just known to be true and that's it, but that claim doesn't seem to me to be a correct one. Now, one perhaps controversial point I'll mention, there are some people who had as well, how do we discover these obvious truths, ones that are supposed to be immune to overthrow by future observation? So some people will appeal to a certain fact about certain statements that, for example, suppose I say, I don't exist, probably many of you wishing that was a true statement but suppose I say, I don't exist. So I couldn't say I don't exist unless I did exist because if I don't exist, I can't make the statement I don't exist. So this kind of case is called a performative contradiction in which my making a certain statement shows that the statement is false. If I say, for example, I never, I say in English, I never in my life spoken sentence in English. My saying that shows that the statement is false since that is an English sentence. So some people have suggested, well that's a test for a priori truth but it isn't true of all a priori truth. For example, suppose I say two plus two equals five, which is false, necessarily false statement. So my saying that it isn't that I could only say two plus two equals five if two plus two equals four. So that would be a case of a priori. I couldn't show that two plus two equals four by showing that a statement denying it is a performative contradiction. Now, one point that could be raised is in the claim that obvious truths that I've made vulnerable to objection. Suppose I'm a brain in a vat and I'm being manipulated by scientists to think I have a body. Wouldn't I have the same experiences as I have right now? So how can I say that my claim I have a body or I'm acting is immune to further observation? Well, to answer this, I think raise a key point is that praxeology is not an attempt, although to answer the philosophical question of skepticism about the external world. Remember, praxeology or economics is one of the sciences. It may not use the same method as a physical sciences, but it's one of the sciences. And in the sciences, we take for granted that the world exists, say, for example, if an astronomer is looking at certain stars, he wouldn't say, well, how do I know that there's actually anything that I'm looking at? I mean, there might be cases where things are defects in his telescope, but the notion that all the data could be the result of illusion is not one that comes up in the sciences. We take the existence of the world for granted. It would be rather odd if, say, imagine say, economists were talking about what are the causes of the 2008 recession. If somebody said, oh, well, look, you're talking about asking about the cause of the recession, but we have to establish there's an external world first. We haven't done that. That really wouldn't make sense. So, and related point is praxeology is not an attempt to solve a philosophical problem of other minds. This problem is both, I know, well, I know I'm thinking myself, but how do I know anyone else is thinking, maybe you're all robots who've been pre-programmed to emit certain sounds. How do I know there actually are any other minds? That isn't a question that praxeology is concerned with. Praxeology is not about my mind or my actions, but with actions, which are actions out there in the world. There isn't a problem of how do I take of a cognitive leap where I say, how do I go from my own thoughts to what's true of other people? It starts with actions, the actions of out there in the world. The point that I made, one of the points I made about that the praxeology is a priori true that these statements are immune from further testing is in conflict with Carl Popper's famous false viability criterion for scientific statements, because what Popper said was, in order to count as a scientific statement, we have to, it has to be capable of being shown false by future observation. We have to be able to specify some observation that would show the statement be false. For example, suppose I say all swans are white, that could be falsified if, by coming up with a black swan, that wasn't white. So what the problem here is that Popper has just arbitrarily ruled out a priori truce ones that can't be shown to be false as scientific, because he just said, look, there has to be some possible observation that would show the statement is false, otherwise it's not scientific. So therefore, a priori statements can't be scientific, but that's just an arbitrary definition of scientific and Mises responds to that in one of his, I think his last book, Ultimate Foundation of Economic Science was to say, well, Popper should have just looked at what's actually done in economics, rather than come up with some sort of preconceived notion of what science is. And I think one reason I mentioned Popper in this, I'll end on, is that one of the greatest obstacles, or perhaps the greatest obstacle to consideration of practicality by economists is the influence of Popper and his followers, especially ones that call themselves critical rationalists, because they hold that everything is tentative. All that we have are conjectures and they'll have views such as, there's no good reason to believe anything. Well, I suppose there's no good reason to believe that, then I don't believe it. So I should say that the Popperian views or their popular among economists aren't really that popular anymore among mainstream philosophers of science, but the basic difference here is just in the reluctance to accept that we actually know things. And as I've hoped to show in this lecture, that reluctance is not to be found in praxeology. We do know things in praxeology, right? Thank you.