The Fall 1999 issue of The Cato Journal featured articles on the legacy of Mises and Hayek. Unfortunately, several of the papers on Mises exhibit fundamental misunderstandings of key points of Mises’ epistemology. Leading experimental economist Vernon Smith, in his piece “Reflections on Human Action after 50 Years”, tackles some epistemological issues in Mises head on. Lawrence White did an excellent job in the accompanying commentary of correcting several of Smith’s misunderstandings.
For instance, Smith fails to grasp that when Mises says all human action is rational, he is not arguing an empirical fact, but setting up the definitions of his terms.
White’s analysis of the importance of experimental economics is also on target. (He concludes that it is useful, but not fundamental, to economics. It cannot decide praxeological questions, but can be both a learning tool and a way to investigate issues that are empirical.)
I would like to examine a topic in Smith’s paper that White only touched on briefly—that of conscious versus unconscious action. Smith opens this section by saying:
Here, Mises has been overtaken by recent trends in neuroscience, for he states, “Conscious or purposeful behavior is in sharp contrast to unconscious behavior, i.e. the reflexes and the involuntary responses of the body’s cells and nerves to stimuli.” He vastly understates the operation of unconscious mental processes.
Smith goes on to posit consciousness as a passive observer of the output of brain activity. He wonders why “the brain fools the mind into believing it is in command of mental activity,” contending that decisions are made by the brain a half-a-second before it lets the mind know. But we are not to worry: “Markets are out there doing their thing whether or not the mainspring of human action involves self-aware deliberative choice.” In fact, human choice, which Mises had placed as the cornerstone in his theory of praxeology, “is not a necessary condition for his system.”
Smith seems to conceive of consciousness as a sort of forlorn ghost, helplessly watching a scene it cannot influence. It is no wonder he is puzzled that evolution has saddled us with such a useless appendage. Smith is also completely unclear how this meaty, physical, totally-in-charge brain communicates to this ephemeral, wraith-like mind, or why it should bother to do so, or why it dithers around for a bit before bothering.
Smith’s epistemology implies that some interesting situations could arise:
- Out at a restaurant, you choose a bowl of chocolate ice cream over one of vanilla. Neuroscientists emerge from the kitchen to inform you that your brain really chose vanilla, but tricked your mind into saying chocolate.
- A recovering alcoholic—I picture Bill Murray’s fiancée in The Razor’s Edge—sits with a drink in front of her. She’s been sober recently and, unlike the character in the movie, she chooses to remain so. Out pop the neuroscientists inform her that, based on readings of the six-layered parts of her orbitofrontal cortex, she “really” prefers the drink. Bottoms up!
Smith has fallen into a terrible philosophical muddle—and no wonder! Someone who looks to neuroscientists for special epistemological insight also, presumably, goes to a car mechanic to decide where to drive and a botanist to do his floral arrangements.
In Human Action, Mises takes an agnostic position towards materialist explanations of mental events, stating that our present state of knowledge did not provide the means to solve such problems. But two decades later, the American philosopher Susanne Langer fully exposed the epistemological shallowness of material monism. As she tells us: “...nerves undergoing electrochemical changes, and the elements of consciousness—emotions, sensations, ideas—as elements of different systems, are not of one metaphysical category.... Their incommensurability... springs from two different concepts of reality: reality as ‘primary substance,’ or ‘matter,’ and reality as the ‘datum,’ or ‘immediate experience.’” She concludes that it is philosophical nonsense to declare that an element in one metaphysical system (e.g., a neuron firing) “causes” an element in another (e.g., a thought).
A large intake of sugar can cause a rise in blood-sugar levels. A feeling of attraction toward a woman can cause a man to give her a call. But, as Mises points out in Human Action, physiological facts are inputs to acting man, much like the weather. It is epistemologically impermissible to say that a large intake of sugar caused a man to call a woman.
By this contention we are not, as some materialists will howl, “placing arbitrary limits on future empirical research.” “Green causes ionization to pick sinning triangles” cannot be “empirically verified” at some later date. Nor can an incredible proposition like Smith’s “the brain fools the mind into thinking it is in command of mental activity,” which describes not empirical findings, but is a symptom of what Mises called “the metaphysical superstition” of materialism.
A decision has not been made until there is a decision—and decisions are elements of the metaphysics of the world-as-experience. Whatever material processes may have been going on “prior” to the decision, from the point of view of world-as-particles all that is there are some electrical and chemical activities in the brain—nothing that could be identified as a decision. There is only a decision when something is interpreted as a decision by someone.
If Smith wants to argue that ‘decision’ should be re-defined, fine, but then he must proceed on a philosophical, not an empirical, basis. The notion that we could empirically show that the common definition of a word is “wrong” is absurd. Empirically, we may demonstrate that it is unlikely that there are unicorns. But no physical experiment could ever show that ‘unicorn’ doesn’t mean ‘magical, horse-like creature with a single horn.’ However, this is exactly the sort of claim that Smith is making—the result of some brain experiments prove that when you say “I chose the blue one,” you don’t really mean that you did anything. You mean that a certain electrochemical configuration occurred in your brain, which you only heard about later as a sort of chemical rumor moseying along the neural grapevine. ‘Decision’ is the name of a conscious experience humans have, the experience of making a choice. It is not “really” anything else, just as thunder is not “really” lightning.
The terms that economics studies are not elements of the metaphysics of the-world-as-substance, which can describe a market transaction only as various particles, atoms, and molecules moving hither and thither. This is hardly an auspicious basis upon which to begin a study of economics! Today, in fact, we often see exchanges moving almost no matter or energy but having enormous economic consequences, as when billions of dollars of securities are traded on electronic markets. It is only with the meaning that humans attribute to these movements that economic phenomena arise, and so it is in the realm of meaning and evaluation that we must seek knowledge of economics.
We adopt a metaphysical view because it is a useful approach to a particular problem. The world-as-matter has been such for the sciences of physics and chemistry. These sciences did not start out with the idea of, for instance, differential equations, and then attempt to find ways to apply them to their subject matter. They began by studying the subject matter, and developed differential equations because they seemed suited to understanding it. But the social sciences, like younger siblings mimicking their elders, adopted the methods of the physical sciences and decreed that whatever did not fit these methods was not worthy of study. This approach has failed, and Langer clearly states why:
The reason for the failure [of the materialist approach to the social sciences] is that abstract notions borrowed from physics, such as units of matter… and their motions, do not lend themselves readily to the expression of psychologically important problems. The aim of the work is to make mathematics applicable to a given material. In genuinely scientific research the aim is to explain events… and mathematics is not employed unless it is needed…
To contend that the materialist metaphysical approach is “true,” that the world “really” consists of matter and energy, is to mistake a road map for the road. This is the religious dogma of the materialists—unprovable because essentially meaningless, but believed and defended with a ferocity similar to that with which a 17th century Lutheran would defend the doctrine of salvation through faith.
In fact, we know nothing of the world but signs and their interpretations. To state this is not to lapse into solipsism. There is a real world—although not “out there,” for we are enmeshed in it. But we only know this world through semiosis, the process of interpretation. Even the senses do not report “the thing itself,” but only signs of its presence. Our sensory data are signs of something, a something that Mises would refer to as an “ultimate given.”
Mises tells us, “We cannot approach our subject if we disregard the meaning which acting man attaches to the situation….” Similarly, Walter Block says, “economists must interpret human action.” If these economists are correct, and I think that they clearly are, then in studying economics we are involved in issues of semiotic import. The acts of man are taken, by the economist, as signs, and the interpretants of these signs are the categories of human action—scales of value, preferences, choices foregone, and so on. Praxeology is, as Mises points out, tautological, in that all of its findings are already implied in the concept of human action itself. He tells us: “The significant task of aprioristic reasoning is on the one hand to bring into relief all that is implied in the categories, concepts, and premises, and, on the other hand, to show what they do not imply.” Formulating Mises’ statement in semiotic terms, we can say that praxeology is the systematic interpretation of what is signified by ‘human action,’ just as geometry is the systematic interpretation of its axioms. We have arrived at the vision that Langer beautifully articulated: “all at once, the edifice of human knowledge stands before us, not as a vast collection of sense reports, but as a structure of facts that are symbols and laws that are their meanings.”
The question of what we “really” are is without scientific content. All answers—a bag of chemicals, a spirit, a computer program embodied in carbon, and so on—if posited as “our ultimate nature,” are religious in nature. The process of interpretation can not cease, for a sign can only be interpreted by another sign. The concept of an “ultimate” sign that interprets all others is empty. The semiotician Umberto Eco says, “Perhaps we are, somewhere, the deep impulse which generates semiosis. And yet we recognize ourselves only as semiosis in progress...”
Some related material
Mises on The Formal and Aprioristic Character of Praxeology
Mises on The A Priori and Reality
