Theory and History

Theory and History

Theory and History

Ludwig von Mises’ last book is an examination of social sciences as they are and as they should be. Mises characteristically spends time excoriating historians who pretend to be economists. His main effort, however, is on the proper delineation between psychology, economics, thymology, and, of course, history.

For those who have read Human Action, the distinction between historical science and economic science is well known. When a so-called economist models the price of onions in Venice in the 1850s, he is not furthering economic knowledge, but simply using mathematics to relate what happened in the past. That this work provides no economic insight and has no predictive power is a central theme of Theory and History.

Furthermore, Mises attacks supposed economic theories that are actually theories of history, and bad ones at that. He embarrasses Marxism for its foundational beliefs that technology determines the social state of affairs and that history is on an inevitable trend towards a final state of socialism. With his typical dry humor, Mises tears apart collectivist ideologies, though some may seem obscure to a modern reader.

On the other hand, his work on thymology is immortal. He distinguishes between psychology and thymology, saying that where psychology studies the physical, chemical, and biological basis for human behavior, thymology attempts to understand human behavior by investigating the thoughts, judgments, and desires of individuals. Psychology might reveal that a woman was disoriented because of a concussion. Thymology could reveal that a man was disoriented because he had heard some disturbing family news. As Mises puts it:

“Thymology is on the one hand an offshoot of introspection and on the other a precipitate of historical experience. It is what everybody learns from intercourse with his fellows. It is what a man knows about the way in which people value different conditions, about their wishes and desires and their plans to realize these wishes and desires. It is the knowledge of the social environment in which a man lives and acts or, with historians, of a foreign milieu about which he has learned by studying special sources. If an epistemologist states that history has to be based on such knowledge as thymology, he simply expresses a truism.
While naturalistic psychology does not deal at all with the content of human thoughts, judgments, desires, and actions, the field of thymology is precisely the study of these phenomena.”

Mises analogizes psychology and thymology to methods employed by psychiatrists and psychologists. Where the first might try to treat problems with drugs, the second would try to treat ailments with words and ideas. Psychiatry tries to determine what is wrong with the hardware. Psychology tries to determine what is wrong with the software. Thus, the knowledge of human valuations and volitions is properly termed thymology. After separating thymology from psychology, Mises then explains its relation to praxeology and economics:

“Thymology has no special relation to praxeology and economics. The popular belief that modern subjective economics, the marginal utility school, is founded on or closely connected with “psychology” is mistaken. The very act of valuing is a thymological phenomenon. But praxeology and economics do not deal with the thymological aspects of valuation. Their theme is acting in accordance with the choices made by the actor. The concrete choice is an offshoot of valuing.

Why one man chooses water and another man wine is a thymological problem. But is of no concern to praxeology and economics. The subject matter of praxeology…is action as such and not the motives that impel a man to aim at definite ends.”

With a clear understanding of thymology, Mises moves on to history. He says:

“The subject of history is action and the judgments of value directing action toward definite ends. History deals with values, but it itself does not value. It looks upon events with the eyes of an unaffected observer. This is, of course, the characteristic mark of objective thought and of the scientific search for truth. Truth refers to what is or was, not to a state of affairs that is not or was not but that would suit the wishes of the thruth-seeker better.”

Mises touches on other topics throughout the book, including why racism is misguided, what freedom really means, why natural rights is a dead end and why utilitarianism is not. He discusses why there are no absolute values and no normative sciences. He also discusses how popular opinion is what props up government, the idea of free will, and determinism. In one amusing anecdote, he relates how Engle’s obituary to Marx admitted defeat regarding the theory of material productive forces.

As is his way, Mises also sprinkles economic wisdom throughout. He explains how the free market temporarily hurts a few and permanently helps everyone, while government helps a few in the short term and hurts everyone indefinitely. Mises mocks collectivism as the worst kind of religion:

“There is no uniform collectivist ideology, but many collectivist doctrines. Each of them extols a different collectivist entity and requests all decent people to submit to it. Each sect worships its own idol and is intolerant of all rival idols. Each ordains total subjection of the individual, each is totalitarian.”

A thorough examination of how poor social science has spread around the world and a clear explanation of how to correct things. Five Murrays.

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