vol. 30, no. 2 (June),
The New Subjectivist Revolution: An Elucidation
of Ludwig von Mises's Contributions to Economic
by J. Patrick Gunning
Savage, MD: Rowman and Littlefield Publishers, Inc., 1991, pp. xiii,
New Subjectivism is a recasting of the methodological insights of Ludwig
von Mises as set forth in Human Action (1966), originally published
in 1940 as Nationalkonomie. But it is identical, Gunning tells us, to Mises's
methodological apriorism (p. 21), which is defined as the taking for granted
that individuals "possess the social concepts of causality, time and uncertainty"
(p. 33). Mises, however, may not have fully recognized the significance
of his own method (p. 12) and may have sabotaged his methodological revolution
by misusing the method, creating confusing terminology, and failing to
integrate New Subjectivism with Old Subjectivism (p. 10).
Old Subjectivism emerged
in the nineteenth century as a subjectivist treatment of wants. It was
eventually extended in the twentieth century to the realms of expectations,
knowledge, and plans (p. 18). New Subjectivism has its roots in the writings
of Max Weber and his philosopher predecessors (p. 18). The Old and the
New, then, are only loosely distinguished by age. The crucial distinction,
it turns out, is the epistemological status of the subjectivity. Where
the Old proceeded on the basis of assumption, the New identified a priori
categories of human action. "Intuition and experience" (a phrase used repeatedly
by Gunning), reveal the prerequisites of human action and focus the New
Subjectivist's attention on ends and means, causality and teleology, time
and uncertainty. The task Gunning sets for himself is one of codifying
the New Subjectivist Method and exposing as untenable the alternatives
of statistical, institutional, and historical positivism (p. 23).
The core chapters
are inspired by a single chapter of Mises's magnum opus. Mises's twenty-five
page treatment of "The Scope and Method of Catallactics" underlies seven
of the author's chapters (Chapters four through ten), each of whose titles
begin with the phrase "The Method of Contrasting Images of Functions."
What is being contrasted, here (translated liberally), is some notion of
equilibrium in which there is no human action and some notion of human
action which results in equilibrium. Following these core chapters are
three chapters whose titles begin with the phrase "The Method of Economic
Teleology." According to Gunning (p. 3), Mises employed these two complementary
methods but failed to identify clearly the second-mentioned one. In addition
to the core-plus-three chapters, the book contains some introductory material,
a concluding chapter, and nine short appendices, most of which deal with
Much of the book is
an extended exercise in methodological pronouncement and prescription based
upon stipulative definitions and taxonomies of actions suggested by "intuition
and experience." "Economic interaction" is defined so as to exclude barter
(p. 21). Barter is treated instead as a part of the "non-economic environment"
(p. 26). Economic functions are identified as consuming, saving and factor
supplying. Entrepreneurship "is not an economic function but a cause of
the performance of the economic functions" (p. 82). Gunning does not mean
that entrepreneurship, like barter, lies outside of economics but rather
that it cannot or should not be thought of as a function. Functions can
be performed by robots; entrepreneurship cannot. This distinction, however,
gets blurred when Gunning introduces robot entrepreneurs, which are to
be understood, possibly, as not-quite-entrepreneurs. The "robo-ents," as
Gunning calls them, can earn only "robo-profits" (pp. 103-4 and passim).
Private saving is
contrasted not with corporate saving but with social saving. Social saving,
which is defined so as to exclude hoarding money and holding durable goods,
is also called economic saving (p. 121)—as if holdings of money and goods
constitute non-economic savings. In a footnote Gunning indicates that "Since
money and banking are beyond the concern of this book, private saving is
disregarded" (p. 135, n 1). Using money distinguishes economic interaction
from non-economic environment; holding money is disregarded. How this construction
can be reconciled with Mises's celebrated integration of monetary and value
theory is left as a puzzle for the reader.
theorizing is decidedly unMisesian, his eccentric phraseology comes directly
from Human Action. For instance, instead of discussing consumption
utilities, using this Old Subjectivist term, Gunning writes of "getting
relief from a felt uneasiness" (p. 70). While Mises could get away with
such phrasing in the original German and even in subsequent English editions,
Gunning has the reader wondering whether he is talking about consumption
taxonomies and stipulative definitions give way to statements whose meanings
will escape all readers. "Prediction is history pushed into the future"
(p. 25). Whatever its intent, this pronouncement inspires the reviewer
to compare forecaster, historian, and New Subjectivist: The forecaster
looks straight ahead predicting what he can with the data he has; the historian
turns his head 180 degrees to make what sense he can out of that same data;
the New Subjectivist faces straight ahead but turns his eyeballs 180 degrees:
"Consider the case," Gunning writes, "where an individual could know that
he could pay attention to a particular behavior if he were only to pay
attention to whether he was paying attention to his behavior" (p. 46).
New Subjectivism is conducive to such inwardly regressive thinking. The
New Subjectivist, according to Gunning, "strives to acquire an intersubjective
understanding of individuals' intersubjective understandings of each others'
actions and of their understandings" (p. 35). Had he not dropped the adjective
from that last understanding, the regress would have gone on.
Readers who have a
high tolerance for this mode of thought may take the full dose of Gunning's
New Subjectivism. All others who dip into this book are likely to
be left with a felt uneasiness.
Roger W. Garrison
1. Mises, Ludwig von, Human Action: a Treatise
on Economics, third edition. Chicago: Henry Regnery Company, 1966.