Now Playing: COUNTERFACTUALS WEEK (REPOSTED)
Topic: Interconnections
FACTS AND COUNTERFACTUALS IN ECONOMIC LAW
By Jorg Guido Hulsmann
Ludwig von Mises emphasized that economics is the foremost political science of our age. As such, the clarification of the facts on which this science is built, and of the way political conclusions are based on them, is of the greatest practical importance.
The same spirit of a practical-minded interest for the epistemology and methodology of economic science motivates the present paper. I will argue that the nature of human choice jeopardises the mainstream approach to analysing human action, and then show that the difficulties of analysing choice can be overcome once it is recognised that a whole class of economic laws are counterfactual laws. They concern the relationship between what human beings actually do (their behaviour, their thoughts) and what they could have done instead. These laws can be applied in counterfactual analyses of the real world, which consist in comparing observed human behaviour and its unrealised choice alternatives in various (e.g., quantitative) terms.
Posted by Tony Marmo
at 00:01 GMT
Updated: Friday, 4 March 2005 19:05 GMT
