Recently, I have taken a break from reading Mises and started to look into Hayek. I have always felt sympathetic to Hayek because many criticize him for not being a true Austrian, and unfortunately, I thought that once. After reading some Hayek, I started to take interest in how Mises and Hayek are similar. This led to me to read Steve Horwitz, since he does see how Mises and Hayek are quite similar. In one of his blog posts, he sees Hayek as being very consistent in the way Mises views Social Science. Of course, the comments started to go off on the typical Hayek -v- Mises topic and this comment caught my eye (this was a response to another commentor) . I would like to know your response to the comment. Is this sound? Was Mises putting lots of emphasis on rationality simply because the contempories he was facing were 'the cult of irrationalists?" and Hayek putting lot of emphasis on knowledge since the contempories he face dealt with how one could 'plan'? Are Mises and Hayek united and considered complements of each other by arguing what Menger wrote in Principles of Econ and Investigations into The Methods of the Social Sciences?
To begin with your last point, I happen to consider Mises and Hayek to be "complements," not "substitutes." I not share the view that they need to be "de-homogenized" into two distinctly separate goods. And, further, as I know you know, Hayek on more than one occasion over the many years said that the starting point of much of his own work -- on money and the business cycle, on socialist central planning, on the nature and workings of the market order -- was "inspired" and given initial direction from Mises' work. He often found Mises' conclusions persuasive, but found fault with some aspects of the chain of reasoning by which Mises reached that conclusion. And, thus, he attempted to develop his own explanation and chain of reasoning to more persuasively reach a similar conclusion as Mises'. And there is no doubt that each in their (somewhat different) ways were both "children" of Menger's vision presented in both the "Principles" and in the "Investigations." Let me suggest that both Mises and Hayek are attempting to sort out the learning of "patterns" that enable individuals to orient and coordinate their conduct in relation to others in the social and market orders. This was precisely the use and application of the Weberian ideal type by, say, Mises and Schutz. And, in turn, the reasonable presumption of a common logical structure of to the human mind also serves for us to understand how men order and act upon their thoughts, which provides a basis upon which men can know and reason with each other. This is, in my opinion, the Weber-Mises version of "pattern prediction," not in the quantitative sense of prediction, but like Hayek's variation on this theme, the quality and logic of how such social order and pattern emerges and serves to assist people in their orientations and patterned structures of social interdependency. Neither this Weber-Mises version or Hayek's version provides a theory of actually how people learn in the sense of knowing how and why people draw certain conclusions from experiences rather than others. Do psychologists know, yet, why two individuals experiencing the same "experience" learn different lessons from it, in terms of what they think it means and how it makes them respond (to one degree or another) differently? If they have, it would be interesting to know how it it that from the same (market) experience there are simultaneously "bulls" and "bears." I have often wondered why Mises and Hayek -- coming from that same Mengerian tradition -- often discuss what has seemed to me, in essence, the same argument, yet in what appears to be significantly different ways. The following is my (partial) conclusion. It has to do, to some extent, with the context in which they were led to think about these things in terms of the debates and opponents that they respectively faced. Before the First World War and in the 1920s and 1930s, Mises' "opponents" are Historicists, Marxists, and National Socialists in the German-speaking world. They not only deny the logic and coordinating "harmony" of the market order, they question whether the "laws" of economics are even the same for all men or groups of men. These Marxists believes that social "classes" think in terms of different class-interest logics. The National Socialists insist that different races have different logics. Mises is attempting to both challenge and refute these assertions. Mises is arguing there a common reality to the human condition, not only in the sense that the laws of the physical world are the same for all men and groups of men around the world (and in the past as well as the present). But, also, there is a common reality in the logical structure to the human mind -- whether it being in the thoughts that went through the mind of Plato in ancient times, or the "primitive" in a tribe in, say, New Guinea, or in the thinking and acting of a capitalist and his worker in industrial society, or an "Aryan" and a Jew in 1920s, 1930s, Germany. And if there is a common reality of a logical structure of the human mind, then one can attempt to derive from this an understanding of the common reality and logic of how (all) men reason about choice and action. How, with a variety of subsidiary assumptions and "observations" about the institutional circumstances under which men act and interact, one can show the logic and order and patterns that emerge, "spontaneously," from the interactions of many men. And how such order and pattern can be disrupted by various forms of policies that interfere with the workings of a market order. Hence, Mises' insistence on "reason," "rationality," and the "intentionality" of human action that results from that logical structure of the human mind -- but which also generates "order without design" when the individual intentionalities of many men interact in emerging social arenas of life. He is battling what he called in the title of one of his articles from this period, "The Cult of the Irrational." Hayek, on the other hand, finds himself in the English-speaking world of the 1930s and 1940s. Here the intellectual climate is not one, like in the German-speaking world, of calls to the "blood" and race-think. Instead, Hayek finds an intellectual environment in many believe so much in the power of reason and rationality, and to such an extent, that they believe that the human mind can know, comprehend, and integrate all that is needed to know to systematically design and re-order society according to "plan." Rather than like Mises, who must insist upon the primacy and importance of common reason and rationality in a cultural and political climate of calls to "polylogism," Hayek, instead, must focus his "attack" on demonstrating the limits of reason and "rationality" in a climate of opinion in which too many intellectuals believe that they can know "everything" and rationally construct the good and just socialist society. Thus, Mises, in the German-speaking world of that time, must emphasize the common reality and universal logic of human thinking, choosing and acting in a setting in which this commonality is being denied. In other words, the arguments that run through most of Menger's "Principles." Hayek, in the English-speaking world of that time, must emphasize the common reality and limits to men's ability to think, choose, act and try to reshape the social order. In other words, the arguments that run through part of Menger's "Investigations." But, of course, Mises knows and fully appreciates Menger's theory of spontaneous social processes. And Hayek, of course, knows and fully appreciates the common logic in human thought, from which the economist can derive the individual's "logic of choice." Thus, they are playing from the same music score -- Menger's subjectivist conception of man and society -- but they are underscoring different notes on the music sheet given the different "audiences" for whom they are playing the music.
To begin with your last point, I happen to consider Mises and Hayek to be "complements," not "substitutes." I not share the view that they need to be "de-homogenized" into two distinctly separate goods.
And, further, as I know you know, Hayek on more than one occasion over the many years said that the starting point of much of his own work -- on money and the business cycle, on socialist central planning, on the nature and workings of the market order -- was "inspired" and given initial direction from Mises' work. He often found Mises' conclusions persuasive, but found fault with some aspects of the chain of reasoning by which Mises reached that conclusion. And, thus, he attempted to develop his own explanation and chain of reasoning to more persuasively reach a similar conclusion as Mises'.
And there is no doubt that each in their (somewhat different) ways were both "children" of Menger's vision presented in both the "Principles" and in the "Investigations."
Let me suggest that both Mises and Hayek are attempting to sort out the learning of "patterns" that enable individuals to orient and coordinate their conduct in relation to others in the social and market orders.
This was precisely the use and application of the Weberian ideal type by, say, Mises and Schutz. And, in turn, the reasonable presumption of a common logical structure of to the human mind also serves for us to understand how men order and act upon their thoughts, which provides a basis upon which men can know and reason with each other.
This is, in my opinion, the Weber-Mises version of "pattern prediction," not in the quantitative sense of prediction, but like Hayek's variation on this theme, the quality and logic of how such social order and pattern emerges and serves to assist people in their orientations and patterned structures of social interdependency.
Neither this Weber-Mises version or Hayek's version provides a theory of actually how people learn in the sense of knowing how and why people draw certain conclusions from experiences rather than others. Do psychologists know, yet, why two individuals experiencing the same "experience" learn different lessons from it, in terms of what they think it means and how it makes them respond (to one degree or another) differently?
If they have, it would be interesting to know how it it that from the same (market) experience there are simultaneously "bulls" and "bears."
I have often wondered why Mises and Hayek -- coming from that same Mengerian tradition -- often discuss what has seemed to me, in essence, the same argument, yet in what appears to be significantly different ways.
The following is my (partial) conclusion. It has to do, to some extent, with the context in which they were led to think about these things in terms of the debates and opponents that they respectively faced.
Before the First World War and in the 1920s and 1930s, Mises' "opponents" are Historicists, Marxists, and National Socialists in the German-speaking world. They not only deny the logic and coordinating "harmony" of the market order, they question whether the "laws" of economics are even the same for all men or groups of men. These Marxists believes that social "classes" think in terms of different class-interest logics. The National Socialists insist that different races have different logics.
Mises is attempting to both challenge and refute these assertions. Mises is arguing there a common reality to the human condition, not only in the sense that the laws of the physical world are the same for all men and groups of men around the world (and in the past as well as the present). But, also, there is a common reality in the logical structure to the human mind -- whether it being in the thoughts that went through the mind of Plato in ancient times, or the "primitive" in a tribe in, say, New Guinea, or in the thinking and acting of a capitalist and his worker in industrial society, or an "Aryan" and a Jew in 1920s, 1930s, Germany.
And if there is a common reality of a logical structure of the human mind, then one can attempt to derive from this an understanding of the common reality and logic of how (all) men reason about choice and action. How, with a variety of subsidiary assumptions and "observations" about the institutional circumstances under which men act and interact, one can show the logic and order and patterns that emerge, "spontaneously," from the interactions of many men. And how such order and pattern can be disrupted by various forms of policies that interfere with the workings of a market order.
Hence, Mises' insistence on "reason," "rationality," and the "intentionality" of human action that results from that logical structure of the human mind -- but which also generates "order without design" when the individual intentionalities of many men interact in emerging social arenas of life. He is battling what he called in the title of one of his articles from this period, "The Cult of the Irrational."
Hayek, on the other hand, finds himself in the English-speaking world of the 1930s and 1940s. Here the intellectual climate is not one, like in the German-speaking world, of calls to the "blood" and race-think.
Instead, Hayek finds an intellectual environment in many believe so much in the power of reason and rationality, and to such an extent, that they believe that the human mind can know, comprehend, and integrate all that is needed to know to systematically design and re-order society according to "plan."
Rather than like Mises, who must insist upon the primacy and importance of common reason and rationality in a cultural and political climate of calls to "polylogism," Hayek, instead, must focus his "attack" on demonstrating the limits of reason and "rationality" in a climate of opinion in which too many intellectuals believe that they can know "everything" and rationally construct the good and just socialist society.
Thus, Mises, in the German-speaking world of that time, must emphasize the common reality and universal logic of human thinking, choosing and acting in a setting in which this commonality is being denied. In other words, the arguments that run through most of Menger's "Principles."
Hayek, in the English-speaking world of that time, must emphasize the common reality and limits to men's ability to think, choose, act and try to reshape the social order. In other words, the arguments that run through part of Menger's "Investigations."
But, of course, Mises knows and fully appreciates Menger's theory of spontaneous social processes. And Hayek, of course, knows and fully appreciates the common logic in human thought, from which the economist can derive the individual's "logic of choice."
Thus, they are playing from the same music score -- Menger's subjectivist conception of man and society -- but they are underscoring different notes on the music sheet given the different "audiences" for whom they are playing the music.
My Blog: http://www.anarchico.net/
Production is 'anarchistic' - Ludwig von Mises
Boettke says that the best way to read Mises is a Hayekian one and the best way to read Hayek is a Misesian one. I agree with the second part of it: when I read Hayek the first time, parts of it were hard to comprehend, but when I learned the Misesian framework better, things started to become much clearer. I don't agree with the first part though; presupposing a Hayekian framework doesn't really help reading Mises.
The above interpretation seems a reasonably good one. This doesn't mean that there weren't differences in opinion, though. Remember the quote from Hayek in his biography, where he says that Socialism really opened his eyes but (I paraphrase) that he disagreed (now) with Mises his rationalism.
The state is not the enemy. The idea of the state is.
I can see why it would be good to read Hayek from a Misesian point of view. THats how I read Hayek's work, since I just recently started to read him (well a few months) and I already was well read on Mises.
But the blog post is not really the topic I wanted to bring up here, it is the comment that I quoted that I want to discuss. It is basically saying that both these economists are actually very similar. The reasons on why they differ refers to the audience they were trying to debate with. Mises put strong emphasis on rationality and reason precisely because his critics were the German mainstream Econ school of thought. (which is very consistent to what is in "Principles" by Menger) and the reason why Hayek put strong empasis on Knowledge was because his contempories were the central planners that thought they could plan everything just fine. (which the topic of 'lack of knowledge' is influenced by "Investigations" by Menger. )
If the initial comment is valid, then I would say that this is the best reason to why they differed.
I to am discovering Hayek these times, and I’m really struck by the subtle differences between him and Mises. Yes, they share much on the theory of calculation and the business cycles, but Hayek makes it very clear for an attentive reader that the ‘rationalist’ and the ‘evolutionist’ perspectives are as far apart as they can be (of course, he never mention Mises).
Hayek states over and over that e cannot know the full results of our action and policies, even if human intellect can slowly increase its understanding of ever-greater parts of the chain of effects an action/policy will have. Now, he himself sometimes falls victim to this rationalist bias (in his upholding of the Rule of Law as the highest political concept achievable, for example, he bars the evolution of other concepts), but in general Hayek is keen on letting the spontaneous order evolve.
Mises, a true rationalist, insist that the important effect of policies and actions can be foreseen praxeologicaly and aprioristically. Form this position to the natural-rights-anarcho-capitalist one there but one short stroll (and if Mises had moved to the US at a younger age, I’m sure he’d have accepted at least the anarcho-capitalist position).
Hayek again specifically mention the difference between the ‘French economists’ who’s rational style impels to strive for an ancap society, and ‘British economist’, whose evolutionary worldview impels to strive for the evolution of the present order. The enemy of the rationalist is the state, the enemy of the evolutionist is...no enemy actually, at most what slows down evolution.
Its not a distinction in argument, but a basic distinction in worldview.