Subjectivism, Psychology, and the Modern Austrians

Abstract

Most Austrians are likely to say that economics and psychology are separate disciplines and should remain so. This position stems from a reliance on their version of the rationality postulate — that means are purposefully applied to arrive at certain ends — to account for action. But an emphasis on purposefulness and reason may alone no longer be sufficient to keep Austrian economics distinct from psychology. The Austrians have long stressed the influence of time and uncertainty on human action, something which has culminated in their acceptance of many of the views of Shackle. Shackle (1972) draws attention to the fundamental antagonism between time and reason. Should this result in the rationality postulate being abandoned, the door to alternative accounts of choice and action is opened. Austrians interested in pursuing these questions will find it increasingly difficult to keep psychology at bay.