### Grant McDermott

Assistant Professor
Dept. of Economics
University of Oregon

# George Selgin on the Action Axiom

I was pleasantly surprised to see George Selgin leave a comment underneath my previous post concerning Mises's action axiom. In case you missed it, I had quoted a paragraph from an old journal essay of his before voicing my concerns over the extent to which Mises's action postulate could be defended as a truly self-evident axiom (i.e. along the lines proposed by Immanuel Kant [*]). Instead of responding further in the comments section of that post, I rather feel that my reply here is long enough to warrant a post of its own.

[Obviously, I encourage you to read my original post and see his full comment before continuing...]

While I wish to address several points simultaneously, I think that it's best to acknowledge Selgin's final point first:
I don't mean to suggest that I would go out on a limb to defend everything that's in my essay (I wrote it as a grad school paper in '82, and like to think that I've learned plenty since).
Of course, and I would not expect him to. That being said, I should think that he still regards the quoted paragraph as an accurate reflection of what Mises believed and what most Miseans continue to assert to this day. Indeed, I could cite a number of near identical quotes by other authors in confirmation of what Selgin wrote. (E.g. Compare the top paragraph of page 7 in Hans-Herman Hoppe's widely cited essay, Economic Science and the Austrian Method.)

That being said, I'm not claiming to be an expert on the praxeological method or the extent to which Mises anticipated the criticisms of his therory. If this wasn't clear enough from my essay, it was precisely for this reason that I have invited rejoinders to my argument from people who are more familiar with Mises than myself. Among other things, I appreciate the pointers to original material where Mises and his followers have tried to address some of specific issues that I highlighted.

However...

I will certainly object to Selgin saying that I missed the part about purposeful behaviour. Indeed, I see the issue of "purpose" as being at the very crux of my argument. Thus, when he writes "praxeology is only concerned with explaining human action to the extent that it is purposeful", I would submit that this simply reinforces the tautological bent that praxeologists are so keen to defend against. Put differently, this is really just an admission to framing economics within the constructs that specifically suit praxeological analysis[**]. This may be a convenient tautology arrangement, but:

1) It then begs the question: Why the need to invoke Kant at all? When you have already specified the terms and limits of your engagement $$-$$ i.e. purposeful behaviour $$-$$ all this Kantian talk about (non) self-contradicting synthetic a priori truths becomes redundant. I mean, would it really be that different to saying "Homo economicus is only concerned with explaining human behaviour to the extent that agents are rational and narrowly self-interested"? I don't think so.

2) Praxeologists (and Austrians in general) need to be very, very specific about what they regard as non-falsifiable truths and the extent to which it applies to economics in general, or even invalidates other economic theories. While good praxeologists may already have suitably honoured this requirement $$-$$ I'm not in a position to say for sure $$-$$ I certainly don't think that they've done a very good job of communicating this to the broader economics community, which leads me to...

A final comment: I am rather new to this debate and all this may be old hat for people like George. Indeed, looking back over his comment, I get the strong impression that we may ultimately be saying the same thing; perhaps just coming from different perspectives. However, as per the thrust of my original argument, I would be fine with all this if it weren't for the fact that I keep encountering (so-called) Austrians who emphatically insist that economics requires no empirical validation or arbitration between competing theories.[***]

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[*] In his Critique of Pure Reason, Kant argued that we can establish known truths, free of the need for any empirical validation. He proposed the existence of so-called synthetic a priori truths, which could not be denied without  some element of self-contradiction. In other words, you require X to attempt a denial of X and thereby, implicitly, admit to its truth.

[**] Not that there is anything wrong with making simplifications and assumptions; any theoretician does this (though some are undoubtedly better than others). However, as long as you admit to doing this, then you necessarily narrow the scope of what you are able to study or "prove" without the aid of good empirical work or further theoretical consideration.

[***] I blame the internets! On a more serious note, I am aware that there is something of Austrian schism between the followers of Hayek and Mises on this issue of epistemology. Indeed, Hayek's "Popperian" stance is one reason why I find him a much more compelling economist that Mises.