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Values, Facts and Methodologies. A Case Study in Philosophy of Economics

Part of the Vienna Circle Institute Yearbook book series (VCIY,volume 20)

Abstract

One question that has long haunted philosophy of science is whether facts and values are so inextricably mixed up in social science that objectivity in any sense robust enough to distinguish its findings from mere opinion becomes unattainable. A not uncommon view nowadays is that such entanglement only shows the untenability of conceptions of objectivity that forbid it and that a new and value-sensitive conception of objectivity needs to be developed. While the discussion in recent years has centred on the issue of how estimations of inductive risk incur judgments of value—and so generalize the issue across all of the sciences—it is worthwhile to remember that in the decades around the previous turn of the century when the social sciences became established as such, it was the more or less direct interference of politics in the process of social scientific fact finding that was the focus of concern and prompted the demand for value-neutrality. This older worry has not, I submit, lost its urgency and it may be salutary to consider whether, especially in sciences issuing in policy advice, value entanglement is inevitable there as well. I will present a case study from what may at first appear most hostile territory, namely one of the most value-laden of all areas in the social sciences, the socialist calculation debate in political economy.

Keywords

  • Socialist Economy
  • Austrian Economist
  • Impossibility Result
  • Historical School
  • Epistemological Ground

These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Notes

  1. 1.

    See, e.g., Douglas (2000) and (2009) elaborating an argument from Rudner (1953).

  2. 2.

    While I am not unsympathetic to the argument that it is not social science but social philosophy, I shall here treat political economy as a representative of normatively exposed social science and the episode in question as offering a particularly sharp challenge to the general demand for value-neutrality in social science.

  3. 3.

    For Schäffle, supply and demand under socialism “would fall into a hopeless quantitative and qualitative discrepancy” (1875/1892, 87). Schäffle also raised the other two standard objections to socialism: how its institution could overcome the presumed problem of resultant motivation deficits on part of the workers, and how the infringement of the sovereignity of choice of labor and consumption was to be handled.

  4. 4.

    See Kautsky (1902) and Böhm-Bawerk (1896).

  5. 5.

    For examples of Neurath’s socialisation plans, see his (1919) or (1920a) and (1920b).

  6. 6.

    This was first published in Mises (1920) and then greatly expanded into Mises (1922). The ongoing discussions were commented on in Mises (1924) and (1928).

  7. 7.

    Not all treatments of the socialist calculation debate cover it in its entirety; for two that do see Hutchison (1953, Ch. 18) and Steele (1992, Ch. 4).

  8. 8.

    For the origin see Menger (1883/1963), Schmoller (1883/1888) and Menger (1884/1970). For summaries of the Methodenstreit see Ringer (1968, Ch.3, Sect. 2) or Hands (2001, 72–94).

  9. 9.

    See Streissler (1990a) and Grimmer-Solem (2003, 721), respectively.

  10. 10.

    See Hansen (1968, 146–151) and Smith (1990).

  11. 11.

    See Schmoller (1883/1888, 304) and Menger (1883/1985, Appdx V, Fn)

  12. 12.

    Needless to say, there were exceptions to this generalization, but see, with regards to Schmoller, Hansen (1968, 158), Nau (2000, 508), Grimmer-Solem (2003,252), and with regard to Menger, Streissler (1990b).

  13. 13.

    Mises (1940/1949, 4).

  14. 14.

    Mises (1933b/1960, xvii.)

  15. 15.

    Ibid.

  16. 16.

    Mises (1933a/1960, 21).

  17. 17.

    Ibid., 22.

  18. 18.

    Ibid., 12–13.

  19. 19.

    Ibid., 13–14.

  20. 20.

    Ibid., 24.

  21. 21.

    Mises (1922, 11–12, trans. TU). The sections §§ 4–5 of the Introduction from which this quotation is taken were dropped from the second German edition and so were never made it into the translation.

  22. 22.

    Ibid., 90–91.

  23. 23.

    See Weber (1921/1978, 24–26).

  24. 24.

    Mises (1929/1960, 85, trans. Restored from “rational” to “instrumentally rational”).

  25. 25.

    This was first published in Mises (1920) and then greatly expanded into Mises (1922).

  26. 26.

    Mises (1920/1935, 104).

  27. 27.

    See Weber (1921/1978, 103)

  28. 28.

    Mises (1920/1935, 103).

  29. 29.

    Ibid., 105.

  30. 30.

    Ibid., 109–110.

  31. 31.

    Mises (1949, 699).

  32. 32.

    Mises (1957, 242, emphasis added).

  33. 33.

    Mises (1962/2002, 113, 116, 119).

  34. 34.

    See Horkheimer (1937); for discussion see O’Neill and Uebel (2004).

  35. 35.

    For the research program-defense see Neurath (1925a/2004, 446).

  36. 36.

    See Neurath and Schumann (1919, 15–16), Neurath (1925b/2004, 468–471), Neurath (1928/1973, 263); for discussion see Uebel (2005).

  37. 37.

    This is a point shared by contemporary ecological economists: see Martinez-Alier (1995).

  38. 38.

    Mises (1933a/1960, 14).

  39. 39.

    Neurath (1911/1998, 473). Here lies the origin of his later “Inventories of Standards of Living” (1937).

  40. 40.

    Note that even a sympathetic critic like Robert Nozick, who is open to the possibility of synthetic necessary truths, cast doubt on Mises’s conception of the status of his theory of action (1977, 361–369).

  41. 41.

    The seed of Hayek’s information argument can be found at Mises (1920/1935, 102), but

  42. 42.

    See, e.g., Lange (1936).

  43. 43.

    Hayek (1935a, b)/1948, 155).

  44. 44.

    Hayek (1940/1948, 202).

  45. 45.

    Hayek (1945/1948, 91).

  46. 46.

    For a recent critical discussion see O’Neill (2012).

  47. 47.

    To be sure, this argument also presupposes the distinction between epistemic and non-epistemic values. Steel (2010) has provided a solid defence against recent challenges to that distinction.

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Uebel, T. (2017). Values, Facts and Methodologies. A Case Study in Philosophy of Economics. In: Stadler, F. (eds) Integrated History and Philosophy of Science. Vienna Circle Institute Yearbook, vol 20. Springer, Cham. https://doi.org/10.1007/978-3-319-53258-5_8

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