The Ultimate Foundation of Economic Science

Many data with which the mind is concerned either in retrospect or in planning for the future can be expressed in numerical terms. Other relevant magnitudes can only be put into words of a nonmathematical language. In regard to such magnitudes the specific understanding of the sciences of human action is a substitute, as it were, for the unfeasibility of measurement.

In this sense the historian as well as the acting man speaks of the relevance of different events and actions in regard to their production of other events and of definite states of affairs. In this sense they distinguish between more important and less important events and facts and between greater men and lesser men.

Misjudgments in this quasi-quantitative evaluation of reality are pernicious if they occur in planning actions. Speculations are bound to fail if based upon an illusory anticipation of future conditions. Even if they are “qualitatively” correct, i.e., if the conditions they have anticipated really appear, they may bring disaster if they are “quantitatively” wrong, i.e., if they have erred concerning the dimensions of the effects or concerning the timing of their appearance. It is this that makes the long-range speculations of statesmen and of businessmen especially hazardous.