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Thursday, 9 October 2014

First Principles

In my last post I argued that History and Arithmetic are inadequate to question an ideology. You’ll just get more History and Arithmetic in return, even though some of the History may be suspect. For example, that the golden age of Islam in Cordoba was a haven of tolerance is not something of which I am entirely persuaded. If it was so brilliant and if it was brilliant because of Islam, subsequent Islamic hegemonies might have reinforced this view. But I’m doing History again.

I am not knocking History; History is great – but it is insufficiently persuasive. I can point out that Democracy and Science only ever developed in what we call the West; but Abdul may despise Democracy and regard Science as blasphemy. We will never agree on everything unless we can find something about which to agree. It is perhaps unlikely that we will; but Hope is a virtue.

I am firmly of the opinion that many Muslims are better men than I am. I am equally firmly of the opinion that many of them are better men than they would otherwise have been because of their belief in God. I hope and believe that I am a better man for my Catholicism.

Anyway, the excuse for this post is not theological or political or economic. I am sharing David Gordon with you because he is very lucid about the praxeological method, which is contrasted with Physics. In Physics you make observations and then try to come up with an explanatory hypothesis. You then test the hypothesis by further observation and (sometimes) by experiment. Mathematics, by contrast, does not experiment. We do not measure the angles in a triangle, add them together and shout, ‘Eureka; it always comes to 180 degrees.’ No observation can ever disprove that. Austrian Economics works from first principles. Its conclusions may not be as precise as you wish. The exact price of oranges may be elusive; but we can state unequivocally that, all other things being equal, if the price goes up the quantity of stuff sold will go down. As it happens, observation can be used to confirm this, billions of times per day. It’s complicated: if you have to have oranges or die, it will mean that you forego other stuff. What is more, if you have zillions of quid, the price of oranges will be less likely to affect your purchase decisions. We all have different needs and preferences.

I hope you like David Gordon.

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