Pat Gunning writes, inter alia:

 

 

b. Each human being, including you I presume, uses logic in making 

choices about what is best. This is not all he uses but he does use 

this. He also assumes that those with whom he deals use logic. What more 

sensible means would you suggest for building models of interacting 

human beings than to use logic and to assume that the beings you are 

modeling also use logic? There is nothing unusual about Mises's use of 

logic as applied to relevant economic situations (which is what you must 

mean by "pure reason" if you are referring to Mises) in building images 

of market interaction. Nor is there anything unusual about the logic 

that economics students use when they build models of markets.

 

      Thank you, Pat, for your patience in explaining Mises to this slow
student. Will comment, though, that I have learned a lot from observing
human behavior driven by fads and fashions and herd and religious movements
that strike me, at least, as "illogical". I would have trouble coping with
life, and with understanding other people, if I depended entirely on my
introspective ideas of logic, and assumed others thought the same way I do,
for they emphatically do not. Veblen has a lot to teach us, although he,
too, was capable of error. Tom Schelling, the great game theorist, has
stated that he sees no solution for post-Katrina New Orleans because of the
problem of coordinating expectations, which (he says) markets cannot do.
Logic, or at least his logic, fails him, while the Greek Orthodox religious
community of New Orleans is successfully coordinating expectations in its
own (illogical?) way, as many ethnic and religious colonies have before it.
One of Schelling's predecessors - was it von Neumann? - advised President
Eisenhower to solve the nuclear problem by a first strike against the USSR,
which Ike, without much logic but lots of experience, declined to do. 

 

      So I do think we need to temper logic with observation, when making
policy. It is true, as you state (not quoted above) that some statists and
other control freaks (including corporate CEO's) use empirical studies to
manipulate people. Alston Chase's recent book on *Harvard and the Unabomber*
documents this at chilling length. That is not a sufficient reason, I
submit, for the rest of us to deny ourselves the benefits of such studies
for more worthy purposes.

 

      Again, thank you for your help in our understanding of Mises.

 

Mason Gaffney