Austrian economics starts out from the thesis that the objects of economic science differ from those of the natural sciences because of the centrality of the economic agent. This allows a certain a priori or essentialistic aspect to economic science of a sort which parallels the a priori dimension of psychology defended by Brentano and his student Edmund Husserl. We outline these parallels, and show how the theory of a priori dependence relations outlined in Husserl’s Logical Investigations can throw light (...) on the Austrian account of entrepreneurship. (shrink)

The terms ‘knowledge economy’ and ‘knowledge capitalism’ have been used with increasing frequency since the 1990s as a way of describing the latest phase of capitalism in in the process of global r...

This is a comprehensive anthology of works concerning the nature of economics as a science, including classic texts and essays exploring specific branches and schools of economics. Apart from the classics, most of the selections in the third edition are new, as are the introduction and bibliography. No other anthology spans the whole field and offers a comprehensive introduction to questions about economic methodology.

F. A. Hayek's realistic economic theory has been replaced by the formalistic use of equlibrium models that bear little resemblance to reality. These models are as serviceable to the right as to the left: they allow the economist either to condemn capitalism for failing to measure up to the model of perfect competition, or to praise capitalism as a utopia of perfect knowledge and rational expectations. Hayek, by contrast, used equilibrium to show that while capitalism is not perfect, it contains (...) error‐correcting institutions that bring it closer to perfection than is intuitively apparent. (shrink)

Die vorliegende Schrift unternimmt eine Revision des vorherrschenden Bildes der Rolle und der Konzeptionen von Moral und Ethik im Wiener Kreis. Dieses Bild wird als zu einseitig und undifferenziert zurückgewiesen. Die Ansicht, die Mitglieder des Wiener Kreises hätten kein Interesse an Moral und Ethik gezeigt, wird widerlegt. Viele Mitglieder waren nicht nur moralisch und politisch interessiert, sondern auch engagiert. Des Weiteren vertraten nicht alle die Standardauffassung logisch-empiristischer Ethik, die neben der Anerkennung deskriptiv-empirischer Untersuchungen durch die Ablehnung jeglicher normativer und inhaltlicher (...) Ethik und der Verfechtung eines extremen Nonkognitivismus geprägt ist. Am meisten entspricht die Standardauffassung den Ansichten Rudolf Carnaps, weniger bereits jenen Karl Mengers, Otto Neuraths oder Philipp Franks. Am weitesten weichen Moritz Schlick, Victor Kraft sowie Herbert Feigl von der Standardauffassung ab. Entgegen dem herkömmlichen Bild weltabgewandter Logiker und Metaethiker wurde im Wiener Kreis sogar Angewandte Ethik betrieben, und dies bereits unter diesem Namen. Neben den ethischen Hauptthemen und Ansichten der jeweiligen Philosophen in ihrer Entwicklung im Rahmen ihres persönlichen und kulturellen Kontextes zeigt die Untersuchung, dass allen Ansätzen eine aufgeklärte und humanistische Version von Moral und Ethik gemeinsam ist. Dieser wissenschaftliche Humanismus, der sich schon in der Programmschrift Wissenschaftliche Weltauffassung. Der Wiener Kreis findet, liegt jedoch in verschiedenen Ausprägungen vor. Was die Abweichungen von der Standardauffassung wesentlich betrifft, ist ihre unterschiedliche Auffassung von Moral als gemeinsames oder individuelles Unternehmen. Carnap führt ein extremer Individualismus zu einem extremen Nonkognitivismus, in dem ihm Menger folgt. Bei Schlick ist die Lage zweideutig, was sich in unterschiedlichen Moralbegriffen widerspiegelt. Bei Kraft und Feigl tritt das Verständnis von Moral als gemeinschaftlich geteilte Praxisform klar hervor. Auf der Basis eines gemeinsamen Begriffs des moralisch Guten, der auch eine Sachkomponente enthält, ist eine Verständigung über moralische Fragen möglich. Von einem extremen Nonkognitivismus kann dort nicht mehr die Rede sein. Mit diesen Ergebnissen verbietet es sich, dem Wiener Kreis allgemein eine Ablehnung normativer Ethik und einen extremen Nonkognitivismus zuzuschreiben. Eine systematische Ethik, die Moral als Gemeinschaftspraxis begreift, steht einigen im Wiener Kreis näher, als das vorherrschende Bild suggerieren möge. Wer meint, mit engem Bezug zur Tradition des Wiener Kreises nur Carnap folgen zu können und Ethik als suspektes Unternehmen betrachten zu müssen, irrt. Ethik war in der Tradition Analytischer Philosophie nicht immer so marginalisiert, wie sie es in manchen ihrer Teilrichtungen heute noch ist und Gegner(innen) der Analytischen Philosophie vorwerfen. Die vorliegende Untersuchung liefert die nötige Revision einer verfänglichen Fehlentwicklung. (shrink)

A number of writers have drawn on Hayek’s epistemic defence of market institutions to argue that free-markets and tort law are best placed to overcome the knowledge problems associated with the environmental sphere. This paper argues to the contrary, that this Austrian School approach itself suffers from significant knowledge problems. The first of these relates to the ability of Austrian economics to assign victim compensation and the second to the difficulty of establishing causation in complex environmental problems. The paper will (...) also show how alternative approaches may not suffer from these epistemic challenges and are better placed to overcome them. (shrink)

According to Margaret Gilbert’s collective epistemology, we should take attributions of beliefs to groups seriously, rather than metaphorically or as reducible to individual belief. I argue that, similarly, attributions of belief to markets ought to be taken seriously and not merely as reports of the average beliefs of market participants. While many of Gilbert’s purported examples of group belief are better thought of as instances of acceptance, some collectives, such as courts and markets, genuinely believe. Such collectives enact truth-aimed processes (...) that are beyond the control of any single individual. These processes produce beliefs that are distinct from any individual belief and do not merely report the “average” or “majority” view of the group. In the case of markets, beliefs are indicated by prices, though it is often difficult to infer beliefs from prices and those inferences are almost always uncertain. Reliabilism is the best available standard of justification for market beliefs. In some cases market beliefs are reliable and prove to be true. Thus, in some cases markets can know. (shrink)

Philosophical action theory seems to be in pretty good shape. The same may not be true for the study of human action in economics. Famous is the rant that the study of human action in economics gives reason to tremble for the reputation of the subject. But how does this come about? Since economic action is about action, the broader study must surely have a strong impact on the more specific field. The paper sets out, from the ground up, how (...) an essential concept in economic theory–the concept of competition–can fundamentally benefit from insights derived exclusively from analytical action theory broadly conceived. In doing so, the paper delivers on an old Austrian promise: it is sometimes claimed that Austrian economists understand competition better than most economists. This may be a bold claim, since Austrian economists have neither traced the understanding of subjectivity to its very origin (the theory of intentionality), nor have they traced their sympathy for methodological individualism in relation to market processes to its very ground (the theory of (human) action). This paper aims to fill this gap. Moreover, by grounding an Austrian view of competition in analytic action theory, it succeeds in avoiding the serious problems of the dominant equilibrium approach. By explaining competition as rivalry, the paper draws on the philosophy and logic of human action to bring the (economic) agent back into play. In this way, a case is made for an integrated view of Austrian theory as an amalgam of Austrian economics and analytic action theory. (shrink)

Hayek's later work on the possibility of socio-economic order in decentralized market economies is an exercise in contrastive causal explanation as conceptualized by realist social theorists and philosophers. This interpretation of Hayek's work lends support to the view that Hayek's post-1960 writings can be thought of as an example of comparative institutional analysis. It also provides a means of reinforcing Hayek's own efforts to establish the scientific credentials of his work.

In this article, we draw upon the philosophy of critical realism to reflect upon issues concerning discovery processes and opportunity development. First, paradoxes in the relationship between opportunity discovery and creativity are identified and explained. Second, the question of how to investigate opportunities is discussed and a solution informed by critical realism presented whereby three new types of discovery are identified and defined for empirical investigation. Using critical realism to augment entrepreneurial opportunity theory, we propose that discovery processes have significance (...) beyond discovery theory and can be considered revealing for theories of opportunity development more generally. We conclude with conceptual and practical comment on the importance of ontological theorising for entrepreneurship. (shrink)

We study a case that applies hermeneutics to social sciences, in particular to the Austrian School of economics. We argue that an inaccurate treatment of hermeneutics contributed to an epistemological downgrade of the Austrian School in the economic scientific community. We discuss hoe this shortcoming can be fixed and how a proper hermeneutic application to the Austrian school explains why this school of thought is neither positivist nor postmodern.

ABSTRACTThis article shows how Hayek’s understanding of ‘unlimited democracy’ was influenced by the work of Carl Schmitt. It goes on to make the case that ordoliberal ideas informed his suggestions for limiting democracy, made in response to Schmitt’s work. A number of authors have drawn attention to the influence of Schmitt on Hayek’s thought. Similarly, the ordoliberal relationship has been explored. However, these two influences must be read alongside each other in order to arrive at a full understanding of Hayek’s (...) deep ambivalence towards democracy and how that developed from the 1930s through to the 1970s. Finally, the article makes the case that the decisive influence on Hayek’s later authoritarian turn was not the work of Schmitt, as certain authors have argued, but ordoliberal interpretations of dictatorship. It also argues that Hayek’s model constitution is informed by fundamental ordoliberal concerns. (shrink)

Friedrich Hayek was a fervent advocate of the methodological specificity of the social sciences. However, given his contact with Karl Popper, several historians and philosophers have characterized his final position as Popperian, that is, a position that would have accepted the unity of scientific method. A closer look at Hayek's philosophy and Popper's own intellectual course shows that such a thesis is based on misconceptions that can be overcome by taking the Hayekian concept of 'spontaneous order' as the foundation of (...) a methodology immune to any kind of methodological monism. (shrink)

Hayek argued that the central question of economics is the coordination problem: How does the spontaneous interaction of many purposeful individuals, each having dispersed bits of subjective knowledge, generate an order in which the actors' subjective data are coordinated in a way that enables them to dovetail their plans and activities successfully? In attempting to solve this problem, Hayek outlined an approach to economic theorizing that takes seriously the limited, subjective nature of human knowledge. Despite purporting to have appropriated Hayek's (...) thought by acknowledging the information-transmitting role of prices, mainstream economists have missed Hayek's point. The predominant tool of formal economics—equilibrium analysis—begins by assuming the data held by actors to have been pre-reconciled, and so evades the problem to be solved. Even the more advanced tools for modeling knowledge in economic analysis, such as the economics of information, assume away either the subjectivism of knowledge and expectations (rendering the coordination of beliefs and plans a trivial matter) or the frictions and “imperfections” of reality (rendering the coordination problem indeterminate). (shrink)

In this paper we will analyze Lawson’s criticism of Hayek for not having transcended positivism. We will distinguish two levels in the criticism: methodological and ontological. So far as methodological criticism is concerned, we consider that Lawson’s positivist interpretation of Hayek regarding the method in economics is not the only possible, and we will try to develop another one. With respect to ontological criticism, we will state that though it is possible to understand Hayek as an ontological positivist, since he (...) assumes an ontological individualism, this fact would not necessarily lead to positivism -question to which Lawson seems to bring Hayek closer after 1955- but a moderate ontological individualism could be assigned to Hayek founded on a realistic interpretation of Husserl’s phenomenology. (shrink)

An epistemic account of the circumstances of justice allows one to make three important claims about the Humean and Rawlsian ‘standard account’ of those circumstances. First, and contrary to Hume,...

Postmodernism is often characterized, among other things, as the belief in the unattainability of objective truth and as a rejection of teleological and reductionist, or essentialist, forms of thought. For instance, in his provocative book The Rhetoric of Economics, Donald McCloskey sketches the implications for economic methodology of Richard Rorty's rejection of the modernist quest for Truth, as represented by various rationalist and empiricist epistemologies. McCloskey describes modernist methodology as displaying a desire to predict and control, a search for objective–;which (...) often means measurable–;knowledge, and an attempt to develop a value-free inquiry, among other characteristics. This “methodological correctness,” McCloske suggests, is discredited by the postmodern dissatisfaction with traditional epistemology. Thus, in place of the modernist belief in a rule-guided path to truth, he advocates a “free market” approach to knowledge, in which participants in the variety of theoretical conversations agree to be earnest and listen politely to one another. (shrink)

Readers looking for an articulate, well‐informed exposition of Hayek's multifaceted intellectual achievement will be pleased with Bruce Cald‐well's new book, Hayek's Challenge: An Intellectual Biography of F. A. Hayek. Readers interested in a more critical consideration of Hayek's ideas, or in their ability to withstand cross‐examination from the positions Hayek himself criticized, are less likely to be satisfied. But even for the latter group, Caldwell has performed a useful service, compressing the varied elements of Hayek's complex thought into a lucid (...) synopsis that should facilitate engagement with those outside the Austrian camp. (shrink)

Friedrich von Hayek’s classical liberalism argued that free markets allow individuals the greatest opportunity to achieve their ends. This paper develops an internal critique of this claim. It argues that once externalities are introduced, the forms of economic knowledge Hayek thought to undermine government action and orthodox utilitarianism also rule out relative welfarist assessments of more or less regulated markets. Given the pervasiveness of externalities in modern economies, Hayek will frequently be unable to make comparative welfarist claims, or he must (...) relax his epistemic assumptions and allow for greater government action than his classical liberalism would wish to accept. (shrink)

This article discusses the challenges raised by the inclusion of evolutionary elements in the theories of Carl Menger, Joseph Schumpeter, and Friedrich Hayek. Each adopted an idiosyncratic position in terms of method of inquiry, focus, and general message. The breadth of the topics and phenomena they cover testifies to the great variety of interpretations and potential uses of evolutionary concepts in economics. Menger, who made no reference to Darwin’s theory, advanced an “organic” view of the emergence of social institutions. Schumpeter (...) elaborated an original theory of industrial development based on the recurrent emergence and dissemination of innovations. Hayek adopted the biological notion of group selection and made it the central element in his theory of cultural evolution and the rise of the free market. The chapter concludes with a preliminary evaluation of the possible role that evolutionary theorizing might play in the future development of Austrian economics. (shrink)

Some recent arguments for paternalist government interventions have been based in empirical results in psychology and behavioral economics that would seem to show that adult human beings are far removed from the ideals of rationality presupposed by much of philosophical and economic theory. In this paper it is argued that we need to move to a different conception of human decision-making competence than the one that lies behind that common line of philosophical and economic thinking, and which actually still lies (...) in the background of some of these recent approaches to paternalist interventions. An alternative picture of human decision-making competence is outlined and four criteria for identifying areas where paternalist interventions have a basic moral and political legitimacy are then identified on the basis of this picture. (shrink)

In the 1930s, socialist economists used the assumptions of equilibrium theory to argue that a central planner could coordinate supply and demand from above. This argument led Hayek, over the years, to try to explain the limitations of equilibrium theory and, conversely, to explain how capitalism functioned without the assumptions of equilibrium being met. In a changing world of agents who are ignorant of the future, how is a functioning market “order” possible? One answer can be found in Hayek's argument (...) that evolved rules make people's future behavior more predictable and, more to the point, that they contain previously accumulated knowledge that provides the building blocks for future economic growth. Hayek's evolutionary theory was flawed, however, in failing to explain how people can know which rules are responsible for their success or failure so that they persist in using those rules and pass them forward in time. However, markets provide immediate feedback about success and failure through profits and losses. An evolutionary explanation of the economy would have permitted Hayek to dispense with the metaphor of general equilibrium, which was increasingly irrelevant to his understanding of economic order. (shrink)

The Austrian School seems to remain outside the debate on the realism of economic models. In principle, given the association of the term “model” with the Chicago School, and also for understanding that Hayek had critized the model of perfect competition as unrealistic. Even though in previous opportunities we showed how the theory of market as a process could be understood as the model of the Austrian School, and that Hayek’s criticism to the model of perfect competition was not so (...) much of unrealistic, but that it was wrongly stated (Zanotti & Borella, 2015), and we developed the ontological foundation of the model in Hayek’s thought (Borella, 2019), in this paper we will show how it is posible to compare pattern predictions with models, and how in this sense, the Austrian School, also seems to get near, even without sufficiently noticing it, to the discussion on models in economics and their realism. Keywords: Realism of models- Hayek- pattern predictions-models . (shrink)

Our goal in this article is first to give a broad outline of some of Hume’s major positions to do with justice, sympathy, the common point of view, criticisms of social contract theory, convention and private property that continue to resonate in contemporary political philosophy. We follow this with an account of Hume’s influence on contemporary philosophy in the conservative, classical liberal, utilitarian, and Rawlsian traditions. We end with some reflections on how contemporary political philosophers would benefit from a more (...) explicit consideration of Hume. (shrink)

In the debate on realism of models in economics, the Austrian School and Hayekin particular, seem to have, in a certain way, remained outside. Assuming neoclassical models asunrealistic, the theory of the market as a process looks like a more realistic proposal. However, oneof the fundamental issue s in Hayek’s dissent is not so much the unrealism of the assumptions, but that the market equilibrium theory was not correctly raised, especially with regards to the perfectknowledge assumption. Despite this, in this (...) setting and in line with a previous paper (Zanotti & Borella, 2015), we will argue that Hayek’s spontaneous order may be understood as the Austrian School’s “model”, assuming Mäki’s MISS version of models (Models as Isolations and Surrogate Systems) and emphasizing the place of the ontological foundation of Hayek’s proposal when assessing his model. (shrink)

Mark Pennington’s Robust Political Economy is a systematic exposition of a framework for analyzing institutional performance. The Robust Political Economy framework evaluates institutions according to their ability to solve knowledge and incentive problems. On grounds of robustness, Pennington combines insights from Austrian market-process theory and public-choice theory to defend classical liberalism from several compelling critiques. These include theories of market failure in economics; communitarian, deliberative-democratic, and liberal-egalitarian theories of justice; and concerns with social capital, domestic and international poverty, and ecology.

G.L.S. Shackle stood at the historic crossroads where the economics of Hayek and Keynes met. Shackle fused these opposing lines of thought in a macroeconomic theory that draws Keynesian conclusions from Austrian premises. In Shackle 's scheme of thought, the power to imagine alternative courses of action releases decision makers from the web of predictable causation. But the spontaneous and unpredictable choices that originate in the subjective and disparate orientations of individual agents deny us the possibility of rational expectations, and (...) therewith the logical coherence of market equilibrium over time. (shrink)

Bastiat is widely acknowledged as the most effective advocate of free markets, but his status as an economist is widely denied even by prominent Austrian economists who share his literary style and support for liberty. In particular, his theories of value and exchange have been attacked as a labor theory of value. Bastiat is exonerated here from these charges and is shown to fully oppose objective theories of value and to fully endorse the gains from free exchange. In addition, Bastiat (...) viewed economics as a science based on deductive reasoning and he vehemently opposed the use of mathematics. He thus was an important precursor of the Austrian school of economics.Bastiat est très reconnu comme étant le défenseur le plus éloquent du libre marché. Cependant, son statut en tant qu’économiste est amplement nié, et ce, même par les économistes Autrichiens éminents qui sont en accord avec son style littéraire et sa défense de la liberté. En particulier, ses théories de la valeur et de l’échange, considérées comme participant de la théorie de la valeur-travail, ont fait l’objet de critiques. Cet article exonère Bastiat de ces critiques et démontre que ses théories s’opposent radicalement aux théories objectives de la valeur : Bastiat avait une compréhension parfaite des gains découlant des échanges libres. De plus, Bastiat envisageait l’économie comme une science reposant sur un raisonnement déductif et s’opposait résolument à l’emploi des mathématiques. En ce sens, il était un précurseur important de l’école Autrichienne d’économie. (shrink)

Marx believed that what most clearly distinguished him and Engels from the nineteenth-century French socialists was that their version of socialism was “scientific” while the latters' was Utopian. What he intended by this contrast is roughly the following: French socialists such as Proudhon and Fourier constructed elaborate visions of a future socialist society without an adequate understanding of existing capitalist society. For Marx, on the other hand, socialism was not an idea or an ideal to be realized, but a natural (...) outgrowth of the existing capitalist order. Marx's historical materialism is a systematic attempt to discover the laws governing the inner dynamics of capitalism and class societies generally. Although this theory issues in a prediction of the ultimate triumph of socialism, it is a commonplace that Marx had little to say about the details of post-capitalist society. Nevertheless, some of its features can be discerned from his critical analysis of capitalism and what its replacement entails. (shrink)

The present essay aims to account for F.A. Hayek's oft-noted 'turn' away from technical economics to concerns of a more philosophical nature. In particular, the paper seeks an explanatory principle that reconciles various elements of both continuity and discontinuity in Hayek's intellectual development, especially with respect to the evolution of his arguments concerning economic fluctuations. The essay uncovers such an explanatory principle in Hayek's own methodology of sciences of complex phenomena. According to this principle, an inquirer who confronts phenomena too (...) complex for adequate explanation on the basis of current knowledge must move to a more general, albeit less testable, explanation. This is precisely what occurred in the evolution of Hayek's thought concerning trade cycles. The concluding section considers the implications of the argument for the extensive secondary literature on Hayek's 'transformation'. (shrink)

Studie má za cíl představit strukturu Hayekova evolucionismu. Argumentace postupuje v několika krocích: Východiskem je historicko- systematická expozice způsobu, jakým evoluční teorie ovlivnila Hayekovu filosofii, především s ohledem na periodizaci vývoje jeho myšlení a systematické odlišení explanans a explanandum v rámci jeho teorie vědy. Dále je rozebírán způsob, jakým Hayek rozvíjí svoji metodologii vědy. V této souvislosti je argumentováno ve prospěch teze, že Hayekovo pojetí metodologického dualismu je důsledkem ovlivnění evoluční teorií. Zároveň je evoluční teorie představena jako nástroj vysvětlení, konkrétně (...) pak tzv. vysvětlení vzorce. Následně je představeno Hayekovo pojetí společnosti v kontextu kulturní evoluce. Společnost je interpretována jako řád jednání a je kladen důraz na Hayekovo vnímání společnosti jako řádu vyvíjejícího se společně s lidskou myslí. Na základě těchto předpokladů je v poslední části rozvinuto Hayekovo pojetí mysli. Toto pojetí vychází z konekcionistické pozice. Dále argumentuji proti tradičnímu pohledu na Hayekovu filosofii jako rozvíjení Kantovy filosofie. Závěr rekapituluje základní body Hayekova evolucionismu. (shrink)

Do markets generate a “just” wage? The answer to this question will depend upon the particular theory of the market that the political economist employs. When comparing actual labor markets with the neoclassical theory of competitive equilibrium as its normative benchmark, Joseph Heath argues that factor pricing is orthogonal to normative issues such as distributive justice. We argue that Heath’s conclusion, though not invalid, follows from a similar normative benchmark of equilibrium, one that evaluates factor pricing without taking into account (...) the institutional conditions within which factor prices emerge. Though indeed classical political economists and early neoclassical economists failed to deliver an explicit theory of distributive justice, what Heath overlooks is that implicit to their understanding of the market process was an institutional theory of distributive justice. (shrink)

Within the planning discourse two poles have materialised over the last decades: a participatory ideal guided by substantive rationality, opposed to an algorithmic governmentality subordinated to instrumental reason. This rift within socialist thought is also observable when it comes to the discovery of needs. The paper understands this discovery procedure primarily as a forecasting problem and demonstrates how many authors dedicated to a participatory planning process call for consumers to write down their desires in the form of wish lists. As (...) a response to this epistemically questionable discovery procedure, the state of the art in capitalist demand-forecasting at enterprises like Amazon is presented, where machine-learning algorithms excel at modelling interrelated time series on a global level by extrapolating demand patterns in real-time. The paper closes with a proposal to reconfigure this predictive apparatus for socialist ends and raises questions concerned with the political implications of centralising decision-making in black-box algorithms. (shrink)

From the perspective of a realist philosophy of social science, the recent explosion of criticisms of mainstream economics, including reinvigorated Austrian criticism, provides what seems like a rich opportunity to join what are too often disjoined disciplinary interests and inquirers, and also to extend the arguments not only as regards the realist theory of social science, but also as regards the implications of this approach for economics. I begin with a minimum sketch of key features of realist philosophy of science (...) as I understand it. The central difference turns on the role and nature of explanation and of theory, between what is frequently termed ‘deductivism’, and on an alternative in which explanation requires the articulation of a causal mechanism, for example, the mechanism provided by molecular chemistry that gives us an understanding of oxidation. I take the position that in social science, explanation requires social causal mechanisms. I consider the Austrian contribution from this point of view and conclude with some hints regarding how the foregoing bears on our understanding of capitalism and socialism. (shrink)

SummaryFriedrich Hayek and Michael Polanyi corresponded with each other for the best part of thirty years. They had shared interests that included science, social science, economics, epistemology, history of ideas and political philosophy. Studying their correspondence and related writings, this article shows that Hayek and Polanyi were committed Liberals but with different understandings of liberty, the forces that endanger liberty, and the policies required to rescue it.

This paper examines many similarities in the methodological and ontological views of George Soros and Friedrich Hayek.

The aim of this paper is to contribute to the development of a theory of economic freedom. In this endeavor, we build our framework on the Hayekian notion of freedom because it explicitly embodies the obvious link between freedom and the state: freedom is an absence of state coercion except for that which enforces abstract, general rules known beforehand. We derive two propositions from this Hayekian thesis and elaborate on them, leading to a categorization of government actions from the viewpoint (...) of economic freedom in which the criterion against which coercive governmental actions must be evaluated is the rule of law, meaning a government’s reliance on general, abstract rules. As an implication, our framework allows us to argue for the imperative differentiation between “efficiency” and “economic freedom” as two separate criteria against which government actions can and must be evaluated. We also show that our framework may help explain the process through which economic freedom enhances growth. (shrink)

Public policy makers are calling for all university students to learn entrepreneurial competencies to prepare them to be productive citizens in an unpredictable future. Far more than simply starting up businesses, entrepreneurship is increasingly seen as a student-centric pedagogical technique (teaching through entrepreneurship) for helping students learn desperately needed foundational skills and attitudes such as curiosity, creativity, opportunity spotting, grit, resilience, proactivity, adaptability, empathy, self-efficacy, motivation, and tolerance for uncertainty and risk. This article describes generational trends that make this education (...) increasingly important and provides a Comprehensive Framework for Entrepreneurship Education (CFEE) to help implement best practices to achieve measurable Assurances of Learning (AoL) results at the institutional, degree program, and individual course levels. (shrink)

At the end of World War II, F. A. Hayek denounced the then-popular idea of central planning by arguing that, if pursued to its logical conclusion, it would entail totalitarianism. But there were at least two problems. First, judging by his example of Nazi Germany, state control over the economy appears to be a consequence, not a cause, of the monopolization of political power. Second, he conflated socialism and mere interference in the market with central planning. Therefore, history did not (...) so much falsify Hayek's prediction as bypass it: Once the vogue for central planning faded in the West, Hayek's book became irrelevant—except, ironically, in Germany. There, it was read as a manifesto for “good planning” through the rule of law. Alongside other “neoliberal” writers, Hayek had a profound (if little acknowledged) influence on the shape of the emerging Federal Republic and, through it, on the whole European institutional framework. (shrink)

In the methodology of scientific research programs (MSRP) there are important features on the problem of prediction, especially regarding novel facts. In his approach, Imre Lakatos proposed three different levels on prediction: aim, process, and assessment. Chapter 5 pays attention to the characterization of prediction in the methodology of research programs. Thus, it takes into account several features: (1) its pragmatic characterization, (2) the logical perspective as a proposition, (3) the epistemological component, (4) its role in the appraisal of research (...) programs, and (5) its place as a value for scientific research. -/- The notion of “novel facts” is highly relevant in his conception, where several aspects are involved: the directions of novel facts, the different kinds of novelty, and the transition from six possible options of “novel facts” to four choices. Thereafter, the prediction of novel facts as the criterion of appraisal is considered. On the one hand, this requires analyzing the theoretical, empirical, and heuristic possibilities of appraisal; and, on the other, whether there is an overemphasis on the role of prediction in methodology of scientific research programs. As a consequence, there is an analysis of Lakatos’ criterion of appraisal in MSRP and economics. (shrink)

How management philosophy is conceived depends on if pragmatism is acknowledged or not! After having been under the main domination of management science both research and education has until recently widened its scope from a decision-making to an action-perspective. It seems to be a recent reconnection to pragmatism that makes the 2011 Carnegie report propose to rethink management in liberal arts terms, whilst the vastly influential 1959 Carnegie Pierson report distanced itself from American pragmatism thus focusing on decisions and forgetting (...) actions. Actions may contain decisions and choices but contain more than that. A decision-perspective explains by causal inference modelling choices as calculated or programmed. The action-perspectives strive at understanding intentions of agents by philosophical interpretations of action stories. It is less limited to finding the logics for constructing worlds, to paraphrase Herbert Simon’s favorite philosopher Rudolf Carnap, than embarking on plausible, although not certain, reconstructions of intentions giving meaning to action stories. This can be illustrated by turning to Elizabeth Anscombe’s Wittgensteinian investigation of intentions as Aristotelian syllogistic reasoning. Her constant analytical care to defend a philosophy of action against metaphysical assumptions and taken-for-granted “psychologisms” shows that an action-perspective is as analytic as ever one of decision-making. What differs is that the latter seems constantly attracted by programming inquiry by “scientific methodology” whilst the latter is charmed by philosophical approaches to action welcoming fascinating conundrums, enigmas and human goofs in the reality of managerial practice. Management science wants to reduce management to logics, programs and models for formal decision making whereas management philosophy is closer to spotting the artfully entrepreneurial in actions. The latter points in the direction of engineering tools, the former to appreciate the toys of management as artwork. Finally the argument of Georg Henrik von Wright helps us see that the two are philosophically compatible; for in a pragmatically inspired management philosophy actions may well contain decisions. (shrink)

ABSTRACTJack Knight and James Johnson argue in The Priority of Democracy that democracy should be theorized and justified pragmatically: Democratic deliberations should be given a central coordinating role in society not because they realize any particular abstract ideal, but because they would elicit the information needed to solve real-world problems. However, Knight and Johnson rely on a naïve economic understanding of knowledge that assumes implausibly that individuals know what they need to know and need only aggregate thier separate beliefs. It (...) is precisely because we may not know what we need to know that we need to continually test our ideas. Contra Knight and Johnson, moreover, we ought to accept that our ability to interpret social experiments properly is questionable. A pragmatic approach to social inquiry, therefore, ought to investigate what beliefs political actors actually bring to collective decisions rather than how theoretically perfect beliefs ought to be elicited and aggregated. (shrink)

Abstract Contrary to Peter J. Boettke's essay, ?What Went Wrong with Economics??, there is no connection between ?formalism? and the alleged inability of mainstream economists to regard theoretical models as anything other than either depictions of real market economies or bases for criticizing market economies and justifying government intervention. Although Boettke's criticisms of the excesses of formalism are justified, Austrian economists such as Boettke need to justify their view that government interventions into economic affairs are inevitably harmful.

In his reply to my critical book review, ?Don't Shoot the Messenger: Caldwell's Hayek and the Insularity of the Austrian Project,? Bruce Caldwell criticizes my account of Carl Menger's ?imaginary goods,? and rejects the line of reasoning I advanced in drawing Keynesian conclusions from Hayekian premises. But Caldwell's proposed methodology for assessing the significance of ?imaginary goods? in advanced market economies is ill conceived; and my pathway from Hayek to Keynes merely pursues a thoroughgoing subjectivism to its inexorable conclusion, which (...) is not, as Caldwell suggests, countercyclical fiscal policy. (shrink)

The dissertation concerns F. A. Hayek’s critique of legislation. The purpose of the investigation is to clarify and assess that critique. I argue that there is in Hayek’s work a critique of legislation that is distinct from his well-known critique of social planning. Further that the main claim of this critique is what I refer to as Hayek’s legislation tenet, namely that legislation that aims to achieve specific aggregate results in complex orders of society will decrease the welfare level. The (...) legislation tenet gains support; from the welfare claim – according to which there is a positive correlation between the utilization of knowledge and the welfare level in society; from the dispersal of knowledge thesis – according to which the total knowledge of society is dispersed and not available to any one agency; and from the cultural evolution thesis – according to which evolutionary rules are more favorable to the utilization of knowledge in social cooperation than are legislative rules. More specifically, I argue that these form two lines of argument in support of the legislation tenet. One line of argument is based on the conjunction of the welfare claim and the dispersal of knowledge thesis. I argue that this line of argument is true. The other line of argument is based on the conjunction of the welfare claim and the cultural evolution thesis. I argue that this line of argument is false, mainly because the empirical work of political scientist Elinor Ostrom refutes it. Because the two lines of argument support the legislation tenet independently of each other, I argue that Hayek’s critique of legislation is true. In this dissertation, I further develop a legislative policy tool as based on the welfare claim and Hayek’s conception of coercion. I also consider Hayek’s idea that rules and law are instrumental in forging rational individual action and rational social orders, and turn to review this idea in light of the work of experimental economist Vernon Smith and economic historian Avner Greif. I find that Smith and Greif support this idea of Hayek’s, and I conjecture that it contributes to our understanding of Adam Smith’s notion of the invisible hand: It is rules – not an invisible hand – that prompt subjects to align individual and aggregate rationality in social interaction. Finally, I argue that Hayek’s critique is essentially utilitarian, as it is concerned with the negative welfare consequences of certain forms of legislation. And although it may appear that the dispersal of knowledge thesis will undermine the possibility of carrying out the utilitarian calculus, due to the lack of knowledge of the consequences of one’s actions – and therefore undermine the legislation tenet itself – I argue that the distinction between utilitarianism conceived as a method of deliberation and utilitarianism conceived as a criterion of correctness may be used to save Hayek’s critique from this objection. (shrink)