According to the Austrians, economic theories cannot be proved or disproved based on empirical evidence but rather through deduction based on irrefutable axioms. So my question to you, as humans utilizing the little time we have on this world to strive for truth, is what sort of empirical evidence would it take for you to question the truth of some of most defining theories of the Austrians? What would it take to be convinced that, even if you don't have the cognitive capacity to identify where the deductive error in the Austrians' logic occurs, they've gotten it wrong in some fundamentally refuting manner throughout the years? What would it take to convince you, even if it is unlikely/impossible for the existence of a state not to grow and grow into the behemoths we see today, that a little bit of state is better than none at all?
It seems to me that the only field of study in my life that operates independent of any sort of proving or disproving empirical evidence is that of Austrian economics. I understand the arguments for why this might be the case, but when we take into account that somewhere along the way our logic could simply be wrong (even if we don't know where the error is occurring), I don't think it is illegitimate to take into consideration the empirical evidence in favor of or contrary to our economic theories to decide whether or not we've aligned ourselves with a consistent and correct economic school of thought.
I can't possibly be the only frequenter of these forums that struggles with this sort of thing, so my question stands: what would have to happen in the physical world to shake your faith in the correctness of established Austrian economic theory?
"But to answer your question: If suddenly everything was backwards, that is, if government interventionism, inflation, and deficits lead to sustainable/robust growth patterns (~15% per year), or if North Korea's communist system made it the wealthiest nation on Earth, then, and only then, would I reject AE."
Really though? because for my conceptions, I don't think there is enough evidence even in the above examples. The only way to disprove a purely logical system is to show that there was an invalid deduction in my opinion not, an empirical discoordination.
For instance, if the communist system made N.K. the wealthiest nation, then it is totally possible that 1) the communist system is really just private enterprise with the name of communism or 2) that the communist system really comes under the axioms of action and that this system is in fact praxeological.
thelion, which of jevons' books do you recommend?
Alex: "what would have to happen in the physical world to shake your faith in the correctness of established Austrian economic theory?"
The only way AE could be undermined would be to undermine the foundation of human action. If it is discovered that human beings don't act, that praxeology is misplaced, that we do not feel unease, that we do not conceive of a means to relieve that unease, and we do not take action to possess the means to achieve our ends, then the foundation of AE would fracture.
In other words, if human beings turned out to be merely collections of "cognitive waves inside an object", an object that is no different than a rock or a subatomic particle, ie, that human beings are not purposeful, then I think praxeology, and therefore AE, would be undermined.
Barring that kind of perception of the human being, I do not see how the correctness of AE theory can be disputed since the theory it is true by definition. It is true by virtue of the terms used. Opponents of AE must attack praxeology, the study of human action, rather than appeal to empirical data or historical trends. Such data, such trends, are meaningless in light of the fact that human beings act purposefully.
I could list some examples of praxeologically true statements but won't use up the space (reference Hoppe's video "The Austrian Method" from Nielsio's Channel on Utube). What empirical data or historical trends could possibly prove such praxeologically true statements to be false?
"The market is a process." - Ludwig von Mises, as related by Israel Kirzner. "Capital formation is a beautiful thing" - Chloe732.
yessir: thelion, which of jevons' books do you recommend?
Empirical evidence disproving the statement 'humans act'
Really though? because for my conceptions, I don't think there is enough evidence even in the above examples. The only way to disprove a purely logical system is to show that there was an invalid deduction in my opinion not, an empirical discoordination. For instance, if the communist system made N.K. the wealthiest nation, then it is totally possible that 1) the communist system is really just private enterprise with the name of communism or 2) that the communist system really comes under the axioms of action and that this system is in fact praxeological.
Essentially I'm saying that I could only abandon AE if suddenly the entire nature of the universe, human action, and logic were dramatically altered/reversed; if man was not man, and reality was not reality. AE is logically sound, and is empirically supported by all of human history (though some object to its business cycle theory on empirical grounds).
"If we wish to preserve a free society, it is essential that we recognize that the desirability of a particular object is not sufficient justification for the use of coercion."
chloe732: The only way AE could be undermined would be to undermine the foundation of human action.
...or by showing that an accepted Austrian theory was improperly derived from these irrefutable foundations. It could be that Mises or Rothbard or one of the other treatise-writing greats simply got some logical deduction wrong along the way, and some of us might not have the cognitive capacity to identify where such an error might have taken place. I think there is only a modicum of brilliant minds in this world capable of evaluating whether the thousands of little logical connections all properly fit together, all completely free of logical fallacies and therefore universally true. I know that I am not (yet) capable of such a thing, so it is not unreasonable (while I am striving for such perfection) to be swayed by empirical evidence that seems to contradict the central tenets of Austrian economics. I'm merely doing the best I can in light of my own uncertainty about whether it all perfectly fits together. It certainly does sound flawless, but can all of you really say with 100% certainty that the edifice of Austrian theory has been perfectly derived from the irrefutable axioms of action, that nowhere along the way was some important deduction overlooked or that some logical fallacy took place? I think it to be pretty unreasonable to boast of such absolute certainty. It's one thing to be certain of the extremely basic axioms, another to be certain that the logical edifice derived from them was flawlessly constructed.
Alex M, you are saying that perhaps there could be a hidden logical flaw somewhere within the vast edifice of AE, but no one has yet been smart enough to locate this error. If the error is located, the whole thing would come crashing down like mainstream economics during a credit crisis (sorry, couldn't resist the analogy).
Do you think perhaps you are actually questioning one aspect of AE, ie, are you questioning whether Austrian Business Cycle Theory is flawed as opposed to AE in general? Should your post say "What sort of empirical evidence would it take to contradict Austrian Business Cycle Theory?"
I just don't see how one empirically disproves human action. Where is the logical flaw in human action? How does one even approach such a question? Now, of course one could use empirical data and historical trends to attempt to refute ABCT, but empirically refute or find a fatal logical flaw in "Austrian economics", ie, human action?
Regarding ABCT, it too is derived from human action. It is about central bank money printing and credit expansion, etc. but the elements of it (time preference, subjective value scales, time structure production, etc.) all these things are built, ultimately, on human action. So, we are back to square one. Human action.
To summarize: How to refute AE - 1) Find the logical flaw in human action (how would one conceive how to begin such an endeavor?), 2) use empirical data and historical trends to refute human action (wrong approach since these things have no meaning relative to human action).
If we were to observe business cycle after business cycle that didn't adhere to the ABCT, Austrian scholars would (hopefully) look at their theory and figure out what they're missing. Theory and empirical work complement one another, without the former you can't do the latter, without the latter the former is likely to turn out to be incomplete at best and hopelessly wrong at worst. Science proceeds by the interaction of the two, not solely by deducing economics from first principles.
Man acts in the Misesian sense because that's how he's defined. Of course, in the real world actors are far more complicated than that, they have all sorts of cognitive imperfections and without these insights any economics is going to be very dry.
"You don't need a weatherman to know which way the wind blows"
Bob Dylan
chloe: If the error is located, the whole thing would come crashing down like mainstream economics during a credit crisis (sorry, couldn't resist the analogy).
Not necessarily. It could simply be missing a gap of insight or two, perhaps that, in fact, "animal spirits" or psychological factors play a bigger role in business cycles than previously thought.
You keep referring to how I must find a flaw in human action, one of the fundamental axioms, in order to disprove Austrian economics, but again, I'm not questioning the axioms, just the process of derivation. Yes, the ABCT is an example of a rigorously derived theorem which is grounded in axioms, but still, its process of derivation is so complicated that something could have been missed along the way. And I don't think it's entirely unlikely that the Austrians throughout years could have overlooked a logical fallacy in the ABCT; if it turned out that business cycles really occurred as a result of some fundamental flaw in the free market system, eminent Austro-libertarians would find it decidedly inconvenient. My point is that they will be focusing their energies on proving the ABCT rather than trying to disprove it, considering the implications if it were found to be damningly incorrect.
"What a ridiculous comment." - I. Ryan
What a meaningless response. Let me illustrate wanking; I deal somewhat in nutrition, fitness, dieting, etc. Used to be a hobby, I used to train people, it's coming back more into my life now for some reason and I'm training and advising people again. And it's a difficult job because their minds of ful of crap from wankers. Wankers tend to cite a whole boatload of studies in which there are conveniently no controls on calorie intake to 'prove' calorie intake isn't the cause for obesity or being over weight, and they then blame 'carbs' or high fructose corn syrup or some other line of shit in an attempt to distract people from basic laws of physics and the fact that if they want to lose weight they need to stop being in a calorie surplus/equilibrium, plain and simple. Or, they will cite endless studies about mTOR and other processes in the muscles to justify some ridiculously complex training protocol to distract people from realizing that both men and women got into very, very fine shape with basic diets, using no protein powders, no specialized pyramid training protocols, but by just lifting heavy shit repeatedly and running a bit.
In other words, when someone pelts you with a boatload of shit that's perhaps relevant but not crucial to an issue or debate, they're wanking. They're meandering up and down lines of shit when it's not necessary and there's a simple issue in front of them to deal with. Likewise, a few pages about Hume and Mises and precise definitions are not necessary to answer this OP's question. If a friend of yours has a relatively simple ethical question in front of them and asks your advice and you hand them a copy of Nicomachean Ethics, you're wanking.
And you're not answering the question.
"Did you not even read what I linked to?"
Yes I did. Why don't you link to a straight answer? OT has a concern about the perception that Austrians reject empricism. Now while this is clearly not the case as empirical examinations of current and past events are standard in Austrian analysis, it is a commonly raised objection to and criticism of the Austrian school in my experience. So why not just say, "The 'rejection' of empiricism is a misunderstanding of the Austrian position based on an out of context quote of Mises'; we just think there are limits to what you can reliably test in such a complex system which severely limits empirical examinations unless they are backed up with a sound logical framework that starts from some axiomatic principles."? You don't need three pages of definitions to do that, even if you would have worded it differently. Nor do you end up looking like you're deflecting the question. You just end up looking like you're full of it, because it's a simple question. Any field that claims to study and describe reality has to conform to reality and be testable against reality by some means. Otherwise it's wind baggery, plain and simple.
how many triangles will you need to measure before you believe a certain theory about the sum of the angles?
Poor analogy. Unless the premises plugged into a logical statement are as precise as the measurements of a Euclidean geometry formula, it doesn't hold. The sum of the angles in a triangle may never be more than 180 degrees, however if you're not measuring the angles correctly that formula looses its usefulness.
I have no interest to prove anything. I do know that I went on low-calorie diets for years, only to end up feeling like crap and not losing weight. I then ate many eggs with yolks for breakfast, roast chicken for lunch, and a couple steaks for dinner for a few years. I lost 100 pounds in that time, increased my lifts, and didn't feel like crap. That's proof of nothing, but it is empirical evidence of...I don't know what.
Continuing, when a field claims to talk about reality, it can mean one of two things. The sciences mean that they make predictions - since Descartes they've stopped claiming to properly explain mechanism. Philosophy means that it explains what observations mean. I think of Austrian economics in that regard. Observations simply do not come with their own interpretations, you have to view them through a lens.
"I am afraid xahrx probably thinks mathematical induction (basically iterative deduction) is actually inductive in the sense of "observation", and that Austrians are the only people who use deductive logic." - thelion
No, I think the idea that Austrians reject empiricism is wrong, they just have a proper understanding of it's limits, especially as regards prediction, vis a vi a system like economics, or the weather as another example. And I also think some Austrians, such as yessir above, are a bit disconnected enough to think that a proper logical construct alone guarantees truth, and perhaps arrogant enough to think they know everything and that their premises must therefore be 100% correct, their syllogisms perfectly constructed, and their conclusions unquestionable. It's important to remember that between Kirk and Spock, Kirk was the captain, and Spock didn't get cool until he dropped the logic as the end all be all of existence and tried to some old fashioned wisdom.
Once more, limit the wanking and get to the issue. There's no need for paragraphs about inductive vs deductive logic when all the OP wants to know is: do Austrians really reject empricism; what empirical evidence might disuade one from being an Austrian? I can certainly name one circumstance: a sustained inflation over a long period of time with no collapse, and no reason to see why it shouldn't.
"But for economic questions, since there not technological, but originate from a demand, we can deduce all theorems from preference vectors, and to rely on empiricism for economic theory is at best quackery and at worst muddling the truth (since we are already capable of knowing it exactly). Empirical knowledge gives us examples. It does not give us theorem (which are universally true)."
Have I said differently? Is not the historical examination I mentioned a perfect example of an empirical example used to illustrate the universal truth of the theory by showing how it fits and explains events better than other theories? Is not the use of Austrian theory to suggest avenues for investigation into past events to bring new or hidden facts to light a means of proving by example it's explanatory power?