In chapter V of human action, Mises attempts to expel the myth of irrational action under the concept of time. And I quote,
"The attempt has been made to attain the notion of a nonrational action by this reasoning: If a is preferred to b and b to c, logically a should be preferred o c. But if actually c is preferred to a, we are faced with a mode of acting to which we cannot ascribe consistency and rationality."
"This reasoning disregards the fact that two acts of an individual can never be synchronous. If in one action a is preferred to b and in another action b to c, it is, however short the interval between the two actions may be, not permissible to construct a uniform scale of value in which a precedes b and b precedes c. Nor is it permissible to consider a later third action as coincident with the two previous actions. All that the example proves is that value judgments are not immutable and that therefore a scale of value, which is abstracted from various, necessarily nonsynchronous actions of an individual, may be self-contradictory."
"One must not confuse the logical concept of consistency (viz., absence of contradiction) and the praxeological concept of consistency (viz., constancy or clinging to the same principles). Logical consistency has its place only in thinking, constancy has its place only in acting."
I does not seem that the majority of our science accepts this principle. Indeed, for those who have read Predictably Irrational, or some of the other pop-economics books, the concept seems to be on the brink of exclusion. Maybe the Austrians are not making a good distinction between the rational action of perfect information and the rational of a human action. The former assumption seems to be absurd, but it is usually taught in the form of a "blind walk" within the stock market or as a joke of two economists, one who spots a twenty dollar bill on the ground and the other (more wise) who explains that it couldn't be, or someone would have already picked it up. This certainly not what Mises has in mind is it?
Read until you have something to write...Write until you have nothing to write...when you have nothing to write, read...read until you have something to write...Jeremiah
Mises is saying preferences change over time, so to say that one should prefer a to c because they earlier preferred a to b and b to c is a non sequitur. So he is saying this is not a counter-example to the fact that action is rational. When Mises adopts the term "rational" all he means is that, in order to achieve a goal, an agent will adopt the means best suited (from their POV) to accomplish their ends (themselves variable and subject to change, something which influences the means adopted to effect satiation.) This is compatible with their being ignorant, wrong &c. about the suitability of the means. So aside from it not being a valid counter-example (I think it's pretty stupid that the notion is even entertained TBH, a sign of how utterly unrealistic neoclassical econ can be), Mises is not referring to the same thing as many of these books are (and I will add usually what "rational" means for them is action in accord with their own preferences.)
Freedom of markets is positively correlated with the degree of evolution in any society...
So would it be correct to say that, since all human action is function of time (including preferences, since preference is developed through thought and thought is action), that when one says they prefer
a to b , b to c, but C to A
They are drawing all of these conclusions at different references of time. Thus, within the passing instances of moving from preferences a to b, b to c and C to A their preferences have already changed. The action is not irrational because the preferences have changed
what people merely 'say' they prefer is irrelevent to economics. how they act to demonstrate their preference is the thing. (perhaps its pedantic for me to press this point here, but I'd rather catch any naive mistakes earlier than later.).
somone can not prove to you that they concurrently preferred a to b and b to c but c to a in action. it is not possible.
they can however demonstrate in action that at one time they prefered a to c, and at yet another time they prefered c to a. This is here repeating what Mises and Jon said.
Where there is no property there is no justice; a proposition as certain as any demonstration in Euclid
Fools! not to see that what they madly desire would be a calamity to them as no hands but their own could bring
Jeremiah Dyke:when one says they prefer
The praxeological economist doesn't care about what people say their preferences are; he cares about what they truly are as is demonstrated by their actual choices in action.
nirgrahamUK:what people merely 'say' they prefer is irrelevent to economics.
You beat me to it by seconds!
Lilburne: Jeremiah Dyke:when one says they prefer The praxeological economist doesn't care about what people say their preferences are; he cares about what they truly are as is demonstrated by their actual choices in action.
I think this view is problematic. You can't be sure that preferences "demonstrated by their actual choices in action," are any more their "true" preferences than vocalized semantic statements denying the that their their actually demonstrated actions represent their actual preferences. I have no problem with saying that actual behaviors are categorically different than vocalized statements against the idea that their behavior is indicative of their preferences... I also have no problem saying that the praxeological economist does not (and should not) care about the former, but only the latter. However, I think it is arbitrary and unwarranted to call the former "true," as opposed to the latter (and vice-versa). Remember that praxeology starts where psychology ends.
majevska:However, I think it is arbitrary and unwarranted to call the former "true," as opposed to the latter (and vice-versa).