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