Abstract
Taking the Misesian and the Hayekian versions of the “Austrian paradigm” as the principal rivals in today’s Austrian economics, the paper argues in support of three claims. The claim that the “causal-genetic method”, advocated by the school’s founder, Carl Menger, suggests itself as nucleus of an evolutionary research program. The claim that among Menger’s heirs F.A. Hayek is the one who most systematically advanced the “evolutionary elements” in the founder’s work, making them a central part of his own research efforts. And the claim that, if Austrian economics aspires to be recognized as an empirical social science, it is the Mengerian-Hayekian evolutionary paradigm, not Misesian praxeology, that qualifies for this purpose.
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Notes
Ludwig von Mises, for instance, counts as the most prominent member of the third generation, while F.A. Hayek, J.M. Kirzner and M.N. Rothbard belong to the fourth generation.
R.N. Langlois (1985: 310): “The Austrians are known for their adherence to a doctrine called subjectivism, which holds, roughly speaking, that explanation in the social sciences consists in tracing social phenomena back to the perceptions and intentions of the agents whose actions those phenomena comprise” – Hayek ([1934] 1992: 89) speaks of “the peculiar subjective or individualistic approach which ... springs directly from Menger”.
Langlois (1985: 312): “Menger’s ... work contains elements that ... his followers took in more than one direction.” – L. White (1985: ix): “The distinctness of the Austrian tradition in economics is correctly attributed to the consistency with which members of the school have employed a common method of analysis, namely one rooted in subjectivism. Yet the defense of this method – the explicit methodology of the school’s members – has rarely been alike from one writer to the next.”
Commenting on the style in which authors like Rothbard attack alleged “deviants” J. Kirzner (1996: 147, fn.) speaks of “rhetorical excesses” and notes: “The near-demonization of Hayek ... for ...alleged deviations from an asserted Misesian orthodoxy is a most distressing phenomenon.”
Rothbard (1992: 7) posits “That the correct Austrian paradigm is and can only be the Misesian, that is, the paradigm of Misesian praxeology; that the competing Austrian paradigms, in particular the fundamentally irrational ‘evolved rules,’ ‘knowledge,’ ‘plans,’ and ‘spontaneous order’ paradigm of Hayek ... (are) fallacious and pernicious.”
In their paper “Austrian Economics and the Evolutionary Paradigm” N. Beck and U. Witt (2019) discuss the “evolutionary elements in the theories of Carl Menger, Joseph Schumpeter, and Friedrich Hayek” (ibid: 205). – The present paper does not cover Schumpeter’s evolutionary outlook because he is generally not considered to “properly belong to the Austrian tradition” (Langlois 1985: 314). As Langlois (ibid.) notes: “His origins and training were certainly Austrian. But his methodological tastes seem, by his own account, ... distinctly non- or even anti-Austrian.”
Menger ([1883] 1985: 130). “Natural organisms almost without exception exhibit, when closely observed, a really admirable functionality of all parts with respect to the whole, a functionality which is not, however, the result of human calculation, but of a natural process. Similarly, we can observe in numerous social institutions a strikingly apparent functionality with respect to the whole. But with closer consideration they still do not prove to be the result of an intention aimed at this purpose, i.e., the result of an agreement of members of society or of positive legislation. They, too, present themselves to us rather as ‘natural’ products (in a certain sense) as unintended results of historical development.”
Hayek [1973] 1978: 277: “The consistent use of the intelligible conduct of individuals as the building stones … is of course the essence of the method that Menger himself described as ‘atomistic’ (or occasionally, in manuscript notes as ‘compositive’) and that later came to be known as methodological individualism.”
Hayek [1973a] 2014a: 59, fn 5. Menger (Menger, 1985: 94) speaks of a “genetic” understanding of social phenomena: “Every theory ... has primarily the task of teaching us to understand the concrete phenomena of the real world as exemplifications of a certain regularity in the succssion of phenomena, i.e. genetically .... This genetic element is inseparable from the idea of theoretical science.”
Menger contrasts his own outlook specifically to “the ‘organic’ view, more correctly the ‘collectivist’ view” ([1883] 1985: 142), adopted by “so many representatives in modern sociological literature”.
Menger ([1871] 1981: 47) adds: “This method of research, attaining universal acceptance in the natural sciences, ... came mistakenly to be called the natural scientific method. It is, in reality, a method common to all fields of empirical knowledge, and should properly be called the empirical method.”
See also Menger [1883] 1985: 147, 151.
Referring to “the example of the social prices of goods” Menger ([1883] 1985: 146) notes: “As is well known, these are in individual cases completely or at least in part the result of positive social factors, e.g., prices under the sway of tax and wage laws, etc. But as a rule, these are formed and changed free of any state influence directed toward regulating them, free of any social agreement, as unintended results of social movement.”
Menger ([1883] 1985: 223): “Law as the intended result of the will of an organized national community or of its rulers is a phenomenon which does not challenge the sagacity of the scholar unduly either in respect to its general nature or its origin.” – Echoing Menger’s assessment, Hayek ([1952a] 2010: 103) says about the social sciences: “The problems which they try to answer arise only insofar as the conscious actions of many men produce undesigned results … . It is only insofar as some sort of order arises as a result of individual actions but without being designed by any individual that a problem is raised which demands a theoretical explanation.”
Indeed, Menger ([1883] 1985: 148) notes, since it suggests itself as the “most obvious idea for arriving at understanding of social institutions”, the pragmatic interpretation has been applied in a “thoroughly unhistorical manner to all social institutions, both those which are presented to us actually as the result of the common will of socially organized human beings and those in which such origin is not detectable.”
See also Menger [1883] 1985: 223.
Menger ([1883] 1985: 155): “Money, an institution serving the common good in the most outstanding sense of the word, can ... come into being legislatively, like other social institutions. But ... the origin of money can truly be brought to our full understanding only by our learning to understand the social institution discussed here as the unintended result, as the unplanned outcome of specifically individual efforts of members of a society.”
The essential achievement of what he calls the “Mandeville-Hume-Smith-Ferguson tradition” ([1967] 1978: 265, fn. 58) Hayek sees in “those twin concepts of spontaneous order and evolution that have become the universal key to the explanation of all highly complex phenomena for which man formerly had to resort to the anthropomorphic explanation of design or creation by one manlike maker” (1984: 319).
Apparently, though, Menger did adopt his “causal-genetic” or evolutionary approach not from the “Scottish founders” of political economy. In fact, strangely enough, he censures Adam Smith and his followers for “their defective understanding of the unintentionally created social institutions and their significance for economy” (Menger [1883] 1985: 172), for seeing institutions as “always the intended product of the common will of society as such” (ibid.). It is instead, as Hayek observes, indirectly, through the Historical School of Jurists, in particular through Friedrich Carl von Savigny, that the Scottish founders’s ideas reached Menger. See Hayek [1967] 1978: 265, fn. 58; [1967b] 2014: 298.
Referring to Menger’s causal-genetic method U. Witt and A. Chai (2019: 10, fn.) posit: “The Austrian School of economics, which Menger founded, did not adopt this method, missing the early chance to put forth a genuinely evolutionary approach.”
Referring to Menger’s outlook at institutions as “the unintended social result of individually teleological factors” Hayek ([1967b] 2014: 297, fn. 14) notes: “The more recent revivial of this conception seems to date from my own article ‘Scientism and the Study of Society’ ... where I argued that the aim of social studies is ‘to explain the unintended or undesigned results of the actions of many men’.” – The article Hayek refers to is republished in Hayek [1952a] 2010: 75–166.
Hayek [1967] 1978: 264 f.: “But the tradition which Mandeville started ... made the idea of evolution a commonplace in the social sciences of the nineteenth century long before Darwin. And it was in this atmosphere of evolutionary thought in the study of society, where ‘Darwinians before Darwin’ had long thought in [such] terms, ... that Darwin at last applied the idea systematically to biological organisms.” –See also Hayek 1960: 59; [1967b] 2014: 301, fn. 23.
On nineteenth century “Social Darwinism“Hayek (1960: 59) comments: “It is unfortunate that at a later date the social sciences, instead of building on these beginnings in their own field, re-imported some of these ideas from biology and with them brought in such conceptions as ‘natural selection,’ ‘struggle for existence’ and ‘survival of the fittest,’ which are not appropriate in their field; for in social evolution, the decisive factor is not the selection of the physical and inheritable properties of the individuals but the selection by imitation of successful institutions and habits. Though this operates also through the success of individuals and groups, what emerges is not an inheritable attribute of individuals, but ideas and skills – in short, the whole cultural inheritance which is passed on by learning and imitation.” – See also Hayek 1973: 23.
Hayek 1984: 319 f.: “That Darwin was the first to produce convincing evidence for the operation of a process of selective evolution in the formation of biological species, for which he deserves the greatest possible admiration, but for which he and his successors elaborated a mechanism not directly applicable to cultural evolution, ought not to have deterred students of human interaction from continuing to develop for their own purposes the original conception of the evolution of human institutions which, though operating through a different mechanism, still relies on the same principles.”
Hayek [1967a] 2014: 287: “As was clearly recognized by Carl Menger, ... the existence of the structures with which the theory of complex phenomena is concerned can be made intelligible only by ... a theory of evolution.”
Hayek ([1973] 1978: 278 f.): “Carl Menger was quite aware of his limitation of the predictive power of the theory he developed and was content with it because he felt that more could not be achieved in this field. There is to me even a certain refreshing realism about this modest aim, which is content, for instance, to indicate only certain limits within which a price will settle down rather than a definite point. Even Menger’s aversion against the use of mathematics seems to me directed against the pretense of greater precision than he thought could be achieved.”
The sciences of life, mind and society, Hayek ([1973] 1978: 278) comments, “are characterized by what Warren Weaver has called ‘organized complexity’ (to distinguish them from the phenomena of unorganized complexity where we can replace the information about the individual elements by statistically ascertained probabilities about the occurrence of certain elements.” – Reading Weavers’s article (“Science and Complexity”, American Scientist 36, 1948, 536–544) helped Hayek to clarify his own understanding of the methodological differences between the social and the natural science. For a more detailed discussion see Vanberg: 2017, 70 ff.
Taking the theory of biological evolution as example, Hayek points out that even the fullest knowledge of the relevant principles “would not enable us to explain why the exisiting species or organisms have the particular structure which they possess” ([1964] 2014: 268). “The reason for this” he (ibid.) argues, “is the actual impossibility of ascertaining the particular circumstances which, in the course of two billion years, have decided the emergence of the exisiting forms, or even those which, during the next few hundred years, will determine the selection of the types which will survive.”
Hayek ([1952] 210: 106): “The distinction between an explanation merely of the principles on which a phenomenon is produced and an explanation which enables us to predict the precise result is of great importance for the understanding of the theoretical methods of the social sciences. It arises, I believe, also elsewhere, for example, in biology and certainly in psychology.”
See fn. 76 below.
For an extensive discussion see Vanberg 2017.
Hayek ([1967a] 2014: 279): “For the purposes of this discussion we shall define the different kinds of elements of which groups consist by the rules of conduct which they obey, and regard the appearance of a transmittable ‘mutation’ of these rules of individual conduct as the equivalent of the appearance of new elements, or as the progressive change in the character of all the elements of the group.”
Hayek (1960: 24): “The mind can never foresee its own advance. Though we must always strive for the achievement of our present aims, we must also leave room for new experiences and future events to decide which of these aims will be achieved.”
Hayek (1960: 24): “There is the fact that man’s mind ... is unaware of much of the experience which has shaped it – experience that assists it by being embodied in the habits, conventions, language, and moral beliefs which are part of its makeup.” Hayek also notes, though: “With this cumulative embodiment of experience in tools and forms of action will emerge a growth of explicit knowledge, of formulated generic rules that can be communicated by language from person to person” (ibid.: 33). – See also Hayek [1952a] 2010: 146 f.; [1970] 1978: 7.
Menger ([1883] 1985: 226) adds: “The protection of what everyone recognizes as his interest becomes the interest of every individual. There thus develops in the population the awareness that adherence to rules in the concrete case is not at the discretion of the individual but must be assured.”
Menger ([1883] 1985: 155): “But, as is well known, there is no better means to enlighten people about their economic interests than their perceiving the economic successes of those who put the right means to work for attaining them.”
See also Hayek ([1970] 1978: 7): “The rules we are discussing are those that are not so much useful to the individuals who observe them, as those that (if they are generally observed) make all the members of the group more effective, because they give them opportunities to act within a social order.”
When Menger ([1883] 1985: 133) contrasts social phenomena which “result from the common will directed towards their establishment (they are its intended products)” from social phenomena which “come about as the unintended result of individual human efforts (pursuing individual interests)”, a clarificatory note is in order. Firstly, methodological individualism requires one to explain social phenomena that result from organized collective action no less than those of “organic origin” in terms of “the efforts of thinking, feeling, acting human beings” (ibid.). Secondly, just as in the case of uncoordinated individual actions, the outcomes resulting from organized collective action may also be different from what the participants intended.
As Hayek ([1967] 2014: 290) notes: “Such rules ... will need some continuous outside pressure to secure that individuals will continue to observe them.”
Hayek (1984: 324) alludes to this requirement when, in reference to practices “whose beneficial effects are not perceived by the individual”, he states: “[T]he first requirement if such practices are to spread ... is that they are maintained long enough, or sufficiently stabilized, to become part of the generally expected conduct, and produce a sort of order whose advantages could operate during a prolonged period of competition with other orders.”
Hayek (1960: 36): “All that we can know is that the ultimate decision about what is good or bad will be made not by human wisdom but by the decline of the groups that have adhered to the ‘wrong’ beliefs.”
Hayek ([1966] 1967: 160): “By ‘liberalism’ I shall understand the conception of a desirable political order.”
Hayek ([1975] 2014: 371): “If man is not to do more harm than good in his efforts to improve the social order, he will have to learn that in this, as in all other fields where essential complexity of an organized kind prevails, he cannot acquire the full knowledge which would make mastery of the events possible.”
In The Fatal Conceit, for instance, after criticizing socialism for demanding “a deliberate arrangement of human interaction by central authority” (1988: 7), Hayek ontinues: “The demands of socialism ... assume that, since people had been able to generate some system of rules, ... they must also be able to design an even better and more gratifying system” (ibid.).
Hayek accuses the “American ‘institutionalists’” ([1952a] 2010: 145, fn. 8) of “a pragmatism which ... leads inevitably to socialism” (ibid.), yet policy by institutional framing that he expressly favors is not categorically different from the policy by purposeful selection that Commons advocates.
As Ebeling (1990: xiii) notes about Mises: “The unique factor that seperates the natural sciences from the social sciences, Mises argued, is the purposefulness or intentionality of all human endeavors. ... Social science, therefore, is grounded at its start in methodological individualism and methodological subjectivism.”
On this divide see also Vanberg 2004: 157 ff. – A. Festre (2012: 74) speaks of ““two polar cases” in terms of which the question of knowledge is dealt with among Austrians, Mises’ “aprioristic approach” on the one side and Hayek’s approach on the other. – Rothbard (1992: 23) alludes to the same contrast when he notes: “At the core of the constellation of crucial differences between the Misesian and the Hayekian paradigms is their respective attitudes toward reason.”
Mises misreads Menger who would hardly have disagreed with Mises’ ([1944a] 1990: 23) comment: “There is no other standard of greater or lesser satisfaction than the individual judgments of value, different with different people and with the same people at various times.”- Menger explicitly states that the “value of goods arise from their relationship to our needs, and is not inherent in the goods themselves” ([1871] 1981: 120). What Menger seeks to highlight in his discussion on “imaginary goods” is the fact that individuals’ judgements of value are dependent on their knowledge and beliefs about factual properties of things, and that with changing knowledge their valuations change, a fact hat is of relevance for our efforts to explain their actions. As he puts it:
The value of goods is therefore nothing arbitrary, but always the necessary consequence of human knowledge … Regarding this knowledge, however men can be in error about the value of goods just as they can be in error with respect to all other objects of human knowledge. Hence, they may attribute value to things that do not … possess it in reality … In cases of this sort we observe the phenomenon of imaginary value” (ibid.).
Rothbard (1997: 58): “Praxeology rests on the fundamental axiom that individual human beings act, that is, on the primordial fact that individuals engage in conscious actions toward chosen goals. The concept of action contrasts to purely reflexive, or knee-jerk, behavior, which is not directed toward goals.”
Rothbard (1997: 70): “In brief, praxeology consists of the logical implications of the universal formal fact that people act, that they employ means to try to attain chosen ends ..., it deals not with the content of men’s values, goals, and actions ... but purely with the fact that they do have goals and act to attain them.”
von Mises ([1942] 1990:9): “We see in the action the endeavor to reach a goal by the use of means ... [W]e do not regard the quality of the ends proposed and of the means applied. We conceive activity as such, its logical (praxeological) qualities and categories.” – Ebeling (1990: xiv f.) notes on Mises’ “categories of action”: “[T]he categories remain purely generic in nature, i.e., they do not provide any information about the specific ends and means selected by individuals.”
von Mises ([1944a] 1990: 35 f.): “Praxeology has built up its system in such a way that its theorems are valid for all human action without any regard to whether the ends aimed at are qualified, from whatever point of view, as rational or irrational.”
Rothbard (1997): 59): “Action implies that the individual’s behavior is purposive, in short, that it is directed toward goals. ... Let us note that praxeology does not assume that a person’s choice of values or goals is wise or proper or that he has chosen the technologically correct method of reaching them. All that praxeology asserts is that the individual actor adopts goals and believes, whether erroneously or correctly, that he can arrive at them by the employment of certain means.”
Rothbard (1990: 317) summarizes Mises‘apriorism in these terms: “He assumes nothing about the wisdom of man’s ends or about the correctness of his means. He ‘assumes’ only that men act, i.e. that they have some ends, and use some means to try to attain them. This is Mises’ Fundamental Axiom, and it is this axiom that gives the whole praxeological structure of economic theory built upon it its absolute and apodictic certainty ... For this Axiom is true for all human beings, and everywhere, at any time, and could not even conceivably be violated.”
Ebeling (1990: xiv) states about Mises’ insistence that praxeology “is both a priori and empirically truthful”: “It is ... empirically truthful because the logic of human thought precludes the conceiving of any conscious human action not operating within these categories, hence, it empirically reflects the essential qualities of all conscious human conduct.” – For an empirical science to produce statements that cannot conceivably be refuted is surely not a virtue but a vice. It means that its statements may refer to reality but do not provide any information about reality, like, for instance, the statement: “If the weather remains as it is, it will not change.”
Hoppe (2007: 25): “Praxeology says that all economic propositions which claim to be true must be shown to be deducible by means of formal logic from the incontestably true material knowledge regarding the meaning of action.”
von Mises ([1962b] 2006: 36): “There are two branches of the sciences of human action, praxeology on the one hand, history on the other hand.”
von Mises ([1944a] 1990: 18): “Praxeology is a theoretical and systematic, not a historical science. Its scope is human action as such, irrespective of all environmental and incidental circumstances of concrete acts.”
von Mises ([1944a] 1990: 27): “The understanding establishes the fact that an individual or a group of individuals have engaged in a definite action emanating from definite judgements of value and choices and aiming at definite ends.”
von Mises ([1944b] 2011: 135): “In the realm of nature we cannot know anything about final causes, by reference to which events can be explained. But in the field of human actions there is the finality of acting men. Men make choices. They aim at certain ends and they apply means in order to attain the end sought.”
von Mises ([1944a] 1990: 27): “Although it is impossible to reduce them to their causes – they would not be ultimate data, if such a reduction were possible – the observer can understand them because he is himself a human being.”
von Mises ([1944a] 1990: 26): “We have not yet discovered other methods for dealing with human action than those provided by praxeology and history.”
Hayek ([1943] 2014: 90): “All that the theory of the social sciences attempts is to provide a technique of reasoning which assists us in connecting individual facts, but which, like logic or mathematics, is not about the facts. It can, therefore, ... never be verified or falsified by reference to facts.”
In this essay Hayek speaks of the “advance in economic theory” ([1952a] 2010: 94), due to “the consistent application of subjectivism” (ibid.), and states in a footnote (ibid, fn. 7): “This is a development which has probably been carried out most consistently by Ludwig von Mises, and I believe that most peculiarities of his views which at first strike many readers as strange and unacceptable trace to the fact that in the consistent development of the subjectivist approach he has for a long time moved ahead of his contemporaries.”
On this issue see Vanberg 2004: 165 and 2017: 48 ff.
This essay, a typescript dated September 1920, remained unpublished until it was included in the 2006 German edition of The Sensory Order, edited and translated by Manfred Streit (Hayek [1920] 2006). The English translation “Contributions to a Theory of How Consciousness Develops” has been published in Hayek 2017: 321–347.
On this see Vanberg 2017.
See also von Mises ([1962b] 2006: 33): “The same external events produce in different men and in the same man at different times different reactions. The natural sciences are helpless in the face of this ‘irregularity’.”
von Mises ([1962b] 2006: 43) refers to this mediating function of “mental activities” when he states that “the natural sciences must admit that this factor must be considered as real also from their point of view, as it is a link in a chain of events that result in changes in the sphere the description of which they consider as the specific field of their studies.” – See also von Mises’ (1949: 881) comment on “the individuals’ innate constitutional characteristics and dispositions”: “we know that they influence both the choice of the ends and that of the means, although our cognizance of the mode of their operation is rather vague.”
For a more detailed discussion see Vanberg 2017: 38 ff.
For a more detailed discussion see Vanberg 2004: 183 ff.; 2017: 41 ff.
Compare this to von Mises (1949: 177): “Action is preceded by thinking. Thinking is to deliberate before-hand over future action and to reflect afterwards upon past action. Thinking and acting are inseparable. Every action is always based on a definite idea about causal relations. He who thinks a causal relation thinks a theorem. Action without thinking, practice without theory are unimaginable. The reasoning may be faulty and the theory incorrect; but thinking and theorizing are not lacking in any action. On the other hand, thinking is always thinking of a potential action.”
See also von Mises ([1932] 1981: 280): “That which man brings into the world at birth, the innate, we call racial inheritance or, for short, the race. The innate in man is the precipitate of the history of all his ancestors, their fate, and all their experience. The life and fate of the individual do not start at birth, but stretch back into the infinite, unimaginable past.”
On cultural evolution Mises notes: “The market economy is the product of a long evolutionary process. It is the outcome of man’s endeavors to adjust his actions in the best way possible to the given conditions of his environment that he cannot alter” (1949: 266). “Property rights as they are circumscribed by laws and protected by courts and the police, are the outgrowth of an age-long evolution” (ibid.: 650). – Like Hayek, who emphasized that “(m)an is as much a rule-following animal as a purpose-seeking one” (1973: 11), Mises ([1944] 1990: 20) states: “Most of man’s daily behavior is simple routine. ... He acquires habits, he develops automatic reactions. But he indulges in these habits only because he welcomes their outcome. As soon as he discovers that the pursuit of the habitual way may hinder the attainment of ends considered as more desirable, he changes his attitude.”
von Mises ([1932] 1981: 280): “After birth, direct experience begins. The individual begins to be influenced by his environment. Together with what is innate, this influence produces the individuals’ Being in each moment of his life.”
von Mises ([1962b] 2006: 15 f.): “The a priori categories are the mental equipment by dint of which man is able to think and to experience and thus to acquire knowledge. ... What we know is what the nature or structure of our senses and of our kind makes comprehensible to us. We see reality, not as it ‘is’ and may appear to a perfect being, but only as the quality of our mind and of our senses enables us to see it. ... In dealing with the a priori we are dealing with the mental tools that enable us to experience, to learn, to know, and to act. We are dealing with the mind’s power, and this implies that we are dealing with the limits of its power. We must never forget that our representation of the reality of the universe is conditioned by the structure of our mind as well of our senses.”
On the complexity issue von Mises ([1942] 1990: 5) states: “The experience with which they (the social sciences, V.V.) have to deal is the experience of complex phenomena. ... (T)he experience of a complexity of phenomena can never prove or disprove a statement in the way in which an experiment proves or disproves.”
For a detailed account of Hayek’s arguments see Vanberg 2004: 176 ff.; 2017: 59 ff.
von Mises (1949: 402) claims: “Carl Menger has not only provided an irrefutable praxeological theory of money. He has also recognized the import of his theory for the elucidation of fundamental principles of praxeology and its method of research.” – Yet, what Mises refers to as “praxeological” in Menger’s theory is not an aprioristic, but rather a methodological individualistic reasoning. “The praxeological method,” he notes, “traces all phenomena back to the actions of individuals” (ibid.: 403). Nor does he provide evidence of a “praxeological theory” when he refers to Menger’s outlook at social phenomena as “the unintentional outcome, the resultant not deliberately designed and aimed at by specifically individual endeavors of the members of society” (ibid.: 404).
In the original text (Menger [1883] 1985: 61) the quoted statement appears as follows and without emphasis: “which are not only absolute, but according to our laws of thinking cannot be thought of in any other way but as absolute.”
Menger ([1883] 1985: 60 f.): “In this manner theoretical research arrives at empirical forms which qualitatively are strictly typical. It arrives at results of theoretical research, which to be sure, must not be tested by full empirical reality (for the empirical forms here under discussion, e.g., absolutely pure oxygen, pure alcohol, pure gold, a person pursuing only economic aims, etc., exist in part only in our ideas).” – See also ibid.: 69: “[T]he results of exact research, and indeed in all realms of the world of phenomena, are true only with certain presuppositions, with presuppositions which in reality do not always apply. Testing the exact theory of economy by the full empirical method is simply a methodological absurdity, a failure to recognize the bases and presuppositions of exact research.”
K. Vaughn (1990: 405) arrives in her analysis of “The Mengerian roots of the Austrian revival” at the conclusion that the Hayekian evolutionary approach appears to be “more consistent with the spirit of Menger’ s inquiry.”
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Vanberg, V.J. Carl Menger, F.A. Hayek and the evolutionary strand in Austrian economics. Rev Austrian Econ 35, 481–515 (2022). https://doi.org/10.1007/s11138-020-00531-8
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DOI: https://doi.org/10.1007/s11138-020-00531-8