Michael Nuwer wrote:
> Pat Gunning's "logical structure of the human mind" is impervious to such change. He
can, thereby, insist that the subject matter of economics is "how people act under the
conditions of a market economy." The approach makes our focus the means involved for
attaining an end, and removes from focus the molding of ends by social circumstances and
psychological interactions.
>
> This is where I find a systematic bias. The Misian way of looking at matters
systematically neglects the ways in which the modern economy constitutes the purposeful
individual. Ideology enters here insofar as the discourse of purposeful action theory is
directed at reconciling us to accepting capitalist institutions as the inevitable
byproduct of social life.
>
Hi, Michael:
I agree with you up to a point. However, I disagree with your
characterization of the Misesian system as being systematically biased.
If a person chooses to neglect the influence of "the system" on the
molding of ends, he is not necessarily biased.
In his evaluations of systems from the viewpoint of what actors aim to
achieve, Mises ordinarily neglects the possibility that actors would
want to avoid being affected by "the system." (The system he had in mind
contained with institutions -- private property, free enterprise, the
use of money -- and individuals acting in markets.) So it seems to me
that the thrust of your criticism should be that Mises neglects what you
believe may be important goals, not that he is systematically biased. I
suspect that you are right about this neglect. But one would do well, I
believe, to think more deeply, as perhaps you have. (I am referring to
your use of the phrase "social circumstances and psychological
interactions.")
One who seeks to evaluate the capitalist system must contrast that
system with alternatives with respect to a particular goal or set of
goals. Thus, to pursue your apparent aim of evaluating the capitalist
system on the basis partly of its effects on the molding of ends, it
would be necessary to describe an alternative system that would
presumably be a competitor with the capitalist system. To Mises, there
were two competing systems: socialism and interventionism. It would seem
to follow that to properly criticize Mises from his point of view, you
would want to compare the effects of these system with capitalism
regarding the molding of ends. Do the other systems "mold ends" more
favorably, in some sense, than capitalism?
You could, of course, go beyond Mises and discuss some other system.
However, the more you removed yourself from the basic utilitarianism
that was the focus of the old economists (and also the new ones), the
farther you would deviate from what has traditionally been regarded as
economics.
Simply put, the issue of how "the system" affects individual values has
never been a serious concern of economics. It could be, of course. Many
years ago, I submitted a paper to Warren Samuels' journal in
institutional economics on how private property rights tended to make
people sybaritic. As I look back on the paper now, however, while I see
the idea as relevant to ethics, I do not see it as relevant to economics
as usually conceived.
Pat Gunning
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