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)

In Chapter 2 of Escape from Leviathan, Jan Lester defends two hypotheses: that instrumental rationality requires agents to maximise the satisfaction of their wants and that all agents actually meet this requirement. In addition, he argues that all agents are self-interested (though not necessarily egoistic) and he offers an account of categorical moral desires which entails that no agent ever does what he genuinely feels to be morally wrong. I show that Lester’s two hypotheses are false because they cannot accommodate (...) weakness of will, because they are inconsistent with agency, which requires free will, because ends, obligations and values cannot be reduced to desires, and because maximisation is often not possible. Further, Lester’s claim that agents are self-interested is vacuous, his attempted reduction of moral behaviour to want-satisfaction fails, and his contention, that agents always do what they genuinely think to be morally required, seems untenable. A defence of freedom that depends on homo economicus is far from promising. (shrink)

This book is a survey of the most important developments in Austrian philosophy in its classical period from the 1870s to the Anschluss in 1938. Thus it is intended as a contribution to the history of philosophy. But I hope that it will be seen also as a contribution to philosophy in its own right as an attempt to philosophize in the spirit of those, above all Roderick Chisholm, Rudolf Haller, Kevin Mulligan and Peter Simons, who have done so much (...) to demonstrate the continued fertility of the ideas and methods of the Austrian philosophers in our own day. For some time now, historians of philosophy have been gradually coming to terms with the idea that post-Kantian philosophy in the German-speaking world ought properly to be divided into two distinct traditions which we might refer to as the German and Austrian traditions, respectively. The main line of the first consists in a list of personages beginning with Kant, Fichte, Hegel and Schelling and ending with Heidegger, Adorno and Bloch. The main line of the second may be picked out similarly by means of a list beginning with Bolzano, Mach and Meinong, and ending with Wittgenstein, Neurath and Popper. As should be clear, it is the Austrian tradition that has contributed most to the contemporary mainstream of philosophical thinking in the Anglo-Saxon world. For while there are of course German thinkers who have made crucial contributions to the development of exact or analytic philosophy, such thinkers were outsiders when seen from the perspective of native German philosophical culture, and in fact a number of them found their philosophical home precisely in Vienna. When, in contrast, we examine the influence of the Austrian line, we encounter a whole series of familiar and unfamiliar links to the characteristic concerns of more recent philosophy of the analytic sort. As Michael Dummett points out in his Origins of Analytic Philosophy, the newly fashionable habit of referring to analytic philosophy as "Anglo-American" is in this light a "grave historical distortion". If, he says, we take into account the historical context in which analytic philosophy developed, then such philosophy "could at least as well be called "Anglo-Austrian" (1988, p. 7). Much valuable scholarly work has been done on the thinking of Husserl and Wittgenstein, Mach and the Vienna Circle. The central axis of Austrian philosophy, however, which as I hope to show in what follows is constituted by the work of Brentano and his school, is still rather poorly understood. Work on Meinong or Twardowski by contemporary philosophers still standardly rests upon simplified and often confused renderings of a few favoured theses taken out of context. Little attention is paid to original sources, and little effort is devoted to establishing what the problems were by which the Austrian philosophers in general were exercised -- in spite of the fact that many of these same problems have once more become important as a result of the contemporary burgeoning of interest on the part of philosophers in problems in the field of cognitive science. (shrink)

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)

In recent decades it has become increasingly clear that a substantial amount of cognitive work goes on independent of consciousness. The research has been carried out largely under two rubrics, implicit learning and implicit memory. The former has been concerned primarily with the acquisition of knowledge independent of awareness and the latter with the manner in which memories not readily available to conscious recall or recognition play a role in behavior; collectively these operations comprise the essential functions of the cognitive (...) unconscious. This paper reviews the recent history of work on these issues, identifies some of the problems confronting researchers, and introduces a theoretical framework based on principles of evolutionary biology within which to view them. The argument is that the cognitive unconscious, despite its apparent sophistication, is of considerable evolutionary antiquity and antedates conscious cognitive systems by a considerable amount of time. Various entailments of this evolutionary perspective are explored including such issues as phylogeny and ontogeny of implicit processes, the robustness of the implicit functions as displayed by the capacity to resist disruptions from psychological and neurological disorders, the relationship between implicit cognition and intelligence, and individual differences in implicit cognitive abilities. (shrink)

OVERVIEWWe ambitiously reexamine Smith’s moral theory in relation to Hume’s. We regard Smith's developments as glorious and important. We also see them as quite fully agreeable to Hume, as enhancement, not departure. But Smith represents matters otherwise! Why would Smith overstate disagreement with his best friend?One aspect of Smith’s enhancement, an aspect he makes very conspicuous, is that between moral approval and beneficialness there is another phase, namely, the moral judge's sense of propriety. With that phase now finding formulation, Smith, (...) if only implicitly, generates a spiral of beneficialness and propriety, a spiral shown in Figure 7 in the present paper. We consider Figure 7, illustrating the spiral, to be the most important arrival point in the present paper; it highlights the non-foundationalism of Smith's ethics. But to arrive at the spiral, we must engage in extensive exegesis.In Part IV of The Theory of Moral Sentiments, Smith presents a foil against which he develops his own theory, a foil supposedly representing Hume. According to the foil, moral approval derives from ‘utility.’ But, in multiple ways, the foil is misleading. We provide an interpretation of Hume, notably his four-factor account of moral approval, before examining Smith's representation of Hume.One twist is that Smith used the words utility and useful differently than Hume did – Smith quietly stretched them to include species of agreeableness, thereby obscuring the importance of agreeableness in Hume’s theory.Another, more significant problem is that Smith allows the impression that in Hume moral approval derives quite determinately from beneficialness. In fact Hume conveys the interpretive and sentimental spaciousness of the operations that generate moral approval; here, Hume even speaks repeatedly of ‘proper sentiments’, thus almost using the term propriety himself.But the propriety phase in Smith opens up to a key facet of Smith’s development on Hume: He poeticizes a locus of sympathy not emphasized in Hume – namely, that between the moral judge and her own man within the breast; that locus enters the theory in addition to the sympathies emphasized in Hume, not in lieu of them. We distinguish lateral sympathy, which is important in Hume’s thought, and vertical sympathy, which is especially characteristic of Smith’s more inner-directed and allegorical thought. Smith embraces Hume’s lateral sympathy and enhances moral theory by adding formulations that elaborate vertical sympathy.Next, we come to something of a twist in the whole matter: We show that – as Smith well knew all along! – propriety is a species of agreeableness! Smith’s propriety phase represents another dimension within which such agreeableness lives: Smith’s vertical dimension thus gives rise to a spiral representing the diachronic development of the judge herself. It is a spiral of beneficialness and propriety: Each propriety phase in the next loop of the spiral engenders a species of agreeableness now as a part of beneficialness.Smith's developments on Hume, then, involve the following three facets: formulation of the propriety phase; the poetic elaboration of vertical sympathy; the diachronic spiral of propriety and beneficialness.The three facets come together, especially in Ed. 6 of The Theory of Moral Sentiments. The whole development goes beyond Hume, but, really, is agreeable to Hume – though Smith himself portrays his developments as disagreeing with features of Hume's moral theory.We speculate that Smith was more or less aware of all that that we say, including the absense of any really substantive disagreement. Why, in that case, would Smith have proceeded as he did? We address that question at the end of the piece. Our speculations suggest a method in the madness. (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.

The article is devoted to the re-problematisation of F.A. Hayek's legacy in philosophy of law and social theory. Taking as an example the works of SPSU professor I.Y. Kozlikhin, and some other works about Hayek's theory of law, the author demonstrates several inadequacies of the current literature on Hayek's legal philosophy. In criticizing these highly debatable approaches, the author describes multiple but rarely considered nuances of Hayek's conception of law, which seem to be necessary for adequate understanding of his works. (...) In the author's view, only these details allow to cast some doubt on stereotypes about Hayek as a sort of “liberal ideologist” and unfold the true original potential of his philosophy. The main hypothesis of the article is that the key to this original potential lies not in Hayek's theory of freedom and market, but in his fundamental epistemological views. The ideal of freedom is not enough to discriminate between what is “just law” and what is not in hayekian theory. Only by the means of Hayek's epistemology we can separate law as “rules of just conduct” from other types of social institutions in his theory. This separation is based on broader epistemological separation of “simple” and “complex” phenomena in Hayek's theory of knowledge, which is reflected in his distinction between “organization” and “spontaneous order”. Since only the last of them represents a «complex phenomenon», it means that only a system of special meta-rational rules of conduct can provide an epistemically restricted social actor with an ability to act effectively in such a complex and rationally unknowable social structure. It is argued that only this “technical” capacity of meta-rational just law can be seen as the true basis of Hayek's theory of law. Neither hayekian theory of freedom, nor his theory of market can shed light on the Hayek’s most important and original contribution in the domain of legal theory. It is Hayek's epistemology that can be seen as the ultimate foundation of his conception of lawn. (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)

Despite the burgeoning interest in new and more complex accounts of the organism-environment dyad by biologists and philosophers, little attention has been paid in the resulting discussions to the history of these ideas and to their deployment in disciplines outside biology—especially in the social sciences. Even in biology and philosophy, there is a lack of detailed conceptual models of the organism-environment relationship. This volume is designed to fill these lacunae by providing the first multidisciplinary discussion of the topic of organism-environment (...) interaction. It brings together scholars from history, philosophy, psychology, anthropology, medicine, and biology to discuss the common focus of their work: entangled life, or the complex interaction of organisms and environments. (shrink)

ABSTRACT Asset‐market bubbles occur dependably in laboratory experiments and almost as reliably throughout economic history—yet they do not usually bring the global economy to its knees. The Crash of 2008 was caused by the bursting of a housing bubble of unusual size that was fed by a massive expansion of mortgage credit—facilitated, in turn, by the longest sustained expansionary monetary policy of the past half century. Much of this mortgage credit was extended to people with little net wealth who made (...) slender down payments, so that when the bubble burst and housing prices declined, their losses quickly exceeded their equity. These losses were transmitted to the financial system—including banks, investment banks, insurance companies, and the institutional and private investors who provided liquidity to the mortgage market through structured securities. It seems that many of these institutions became insolvent; it is certain that they became illiquid. Liquidity loss and solvency fears created a feedback cycle of diminished financing, reduced housing demand, falling housing prices, more borrower losses, and further damage to the financial system and eventually the stock market and the real economy. There are important parallels with the housing and financial‐market booms that led up to the Crash of 1929 and the Great Depression. (shrink)

The theory of cultural evolution proposed by economist Friedrich August von Hayek is without doubt the most harshly criticized component in his highly prolific intellectual corpus. Hayek depicted the emergence of the market order as the unintended consequence of an evolutionary process in which groups whose rules of behavior led to a comparative increase in population and wealth were favored over others. Key to Hayek’s theory was the claim that the rules of the market, on which modern civilization relies, evolved (...) at the meta-individual level and therefore surpass human reason. Hayek believed that his theory provided scientific explanation for the superiority of the market order over rational planning. In this article, I conduct a selective comparison between Hayek’s and Darwin’s theories of cultural group selection and analyze the role that demographic growth and reason play in their respective accounts. I first present Hayek’s theory of cultural group selection, its sources of inspiration, and its important place in his intellectual legacy. I then compare Hayek’s claims to Darwin’s views and highlight fundamental differences in their evaluation of the role of reason in moral evolution. Finally, I offer some comments concerning the place assigned to demographic growth in Hayek’s theory and his over-reliance on economics in explaining cultural evolution. (shrink)

Karl Popper and Friedrich von Hayek became close friends soon after they first met in the early 1930s. Ever since, they discussed their ideas intensively on many occasions. But even though an analysis of the origins and contents of their ideas and correspondence reveals a number of important and fundamental differences, they rarely criticize each other in their published work. The article analyzes in particular the different ideas they have on the role of reason in society and on rationalism and (...) the roots of these differences. Popper’s “Towards a Rational Theory of Tradition” of 1948 contains a criticism of Hayek’s idea—published, for instance, in “Individualism: True and False” of 1945—that we must accept tradition without trying to change it. An analysis of the differences between the two authors touches on topics such as the possibility of public intervention in society, the role of social science in this, the methodology of social science, and the differences between liberalism and social democracy. The article concludes with some possible explanations for Popper and Hayek downplaying their differences in public. The fact remains that they never resolved the tension between Popper’s critical rationalism and Hayek’s conservative rationalism. (shrink)