Rational Choice Theory (RCT) has been central in social science research for decades, yet its intellectual lineage remains contested. This paper clarifies significant historical and methodological distinctions between two major traditions within RCT: the axiomatic, decision-theoretic approach emerging from Princeton, RAND, and other Cold War institutions, and the empirical, choice-oriented approach of the University of Chicago. Drawing on recent historiography, this paper examines why the influential historical accounts of Cold War social science consistently omit Chicago’s contributions. It challenges prevailing misconceptions by demonstrating that axiomatic RCT, with its emphasis on formalistic and mathematically driven decision-making models, developed independently and often in opposition to Chicago’s empirical emphasis on real-world decision-making, individual judgment, and market-oriented analysis. The paper also scrutinizes how scholarly neglect or confusion about these distinct lineages has led to persistent misinterpretations of both traditions. By distinguishing clearly between decision-making as control (axiomatic tradition) and decision-making as choice (Chicago tradition), the study enhances our understanding of the diverse intellectual roots and complex trajectories of Rational Choice Theory.
This study critically revises narratives in the literature concerning the relationship between Friedrich August von Hayek’s philosophy and utilitarianism, aiming to organize and clarify the discourse in this field. At the heart of Hayek’s philosophical system lies the value of individual liberty, defined as the absence of coercion by others. Hayek presents it as a foundational and autonomous value – one that is essential to moral agency and the very essence of morality. He argues that the denial of individual liberty degrades the individual to a mere instrument for others’ ends, a stance he deems morally indefensible. Despite this, Hayek explores the consequences (across various dimensions) of adopting or rejecting freedom as a cornerstone of social order to engage those who might undervalue freedom. Such explorations have contributed to the common interpretation of his work as utilitarian – one important, though not exclusive, factor behind this attribution. However, examining his works reveals that this classification does not hold, as his approach does not fulfill the necessary conditions to count as utilitarianism (consequentialist reasoning featured in his philosophy is neither central nor aligns with utilitarian frameworks). Demonstrating that Hayek’s philosophy diverges from utilitarianism is essential for its accurate interpretation. Misattributing utilitarianism, and therefore collectivist thinking, to Hayek leads to inaccurate interpretations that undermine the individualistic and libertarian nature of his philosophy.
The purpose of the present paper is to ground the alleged universal law of (positive) time preference. Thus, we take the said positivity of individual time preference rates for granted. However, we also take pains to show that some other time preference rates (even negative ones) are conceivable only providing that ceteris paribus clause is not satisfied. All in all, we cannot but admit that the intuition standing behind the apparently necessary positivity of time-preference rates is quite robust. However, little effort has been made to justify it. For example, in Austrian economics, it is said that positive rate of time preference is somehow implied in the concept of human action. Yet, no demonstration to that effect is forthcoming. In this essay, we are trying to approximate what could serve as a best reason to believe that individual time preference rates are indeed positive. We first consider whether a phenomenon of social interest rates is able to ground the positivity of time preference. Having rejected this apparent solution as circular, we analyse whether a case can be made against non-positive rates of time preference as unjustified under any set of relevant beliefs. This attempt is also rejected, as there seems to exist a relevant belief under which a rate of time preference can rationally be zero. Finally, we appeal to the Parfitian reductionist view on personal identity as allegedly capturing necessarily positive rates of time preference. Here we note the crucial fact that psychological connectedness (something at least partially constitutive of personal identity) between person P at some time and the same person at some other time diminishes as the interval between these two times increases. Finally, this very fact appears to neatly explain the positivity of time preference.
Undoubtedly, all main terms of the theory of public goods are well-grounded in the actions of humans. Therefore, in this paper, an attempt is made to conceptualize public goods from the philosophical theory of action, which can be seen as an advancement of Mises’ theory of action. We found that not a single building block of the standard theory of public goods is entirely grounded in the logic of human action. As a consequence, public goods, as defined in the standard theory, cannot exist at all due to reasons of action theory. This does not mean the end of collective consumption. Instead, our results can be used to develop the theory of public goods further, which rests firmly on the analytical basis of human action.
Austrian price theory is riddled with inconsistencies surrounding the neoclassical income effect and Giffen behavior. It has sometimes been argued that neither the income effect nor Giffen behavior exist. This paper first argues that Giffen behavior is possible and can perfectly well be explained within the framework of Austrian price theory in the tradition of Mises. Moreover, it shows that income effects are real. They are merely an outgrowth of the law of diminishing marginal utility applied to money. The paper also outlines the expenditure approach to income and substitution effects as an alternative conceptualization that does not require any reference to quantifiable and measurable notions of utility, or an unambiguous and objective notion of real income.
This paper compares how Austrian and neoclassical economics construct demand curves and examines the fundamental differences in their approaches to utility theory and price determination. It aims to clarify both standpoints by highlighting how distinct foundational assumptions – such as the treatment of money, the homogeneity of goods, and the role of indifference – give rise to different forms of demand curves. The analysis further shows that the Austrian construction can potentially account for Giffen behavior without resorting to an upward-sloping demand curve. Finally, the paper revisits (Hudík, Marek. 2011. “Rothbardian Demand: A Critique.” The Review of Austrian Economics 24: 311–8) critique of Rothbardian demand, demonstrating that it rests on a set of assumptions different from those underlying standard Austrian theory.
L’article rend hommage à la manière dont Bertrand Lemennicier concevait le raisonnement économique. Après un rappel des différents sophismes pouvant être présents dans l’argumentaire des économistes, l’article met en perspective les avantages et les risques d’une telle approche.
Is the setting of speed limits compatible with the principles of a free society? At present, speed limits are conceived and enforced by public authorities. This would lead to their systematic rejection without further analysis and without questioning the framework in which they are defined. This paper argues that a free society with private roads would establish rules of conduct for their operation. These rules would include speed limits, the purpose of which would be mainly to coordinate individual plans and produce value. This paper explains the foundations of a speed limit in a free society, its characteristics and how it works.
j onathan Rauch claims that the aim of liberalism is not to provide for the moral needs of persons but instead provide the space for their pursuit of meaning. His claim could, however, be construed as rejecting the possibility of an objective standard for human good and indeed moral knowledge. Such a construal would make liberalism vulnerable to the postliberal charge that it is, as Alasdair MacIntyre has warned, the harbinger of nihilism. This essay counters this postliberal charge by providing an account of human good that is objective and yet compatible with liberty being the paramount political value.
Il y a plus d’une trentaine d’années, Bertrand Lemennicier formulait différentes propositions de régulation et de réglementation des marchés des substances psychoactives, allant de la dépénalisation de l’usage à une libéralisation des marchés. Ce papier se propose de les interroger et de les positionner dans un cadre offrant de plus larges alternatives. Alors que la demande de drogues est importante, que l’offre s’intensifie et que les produits se diversifient, les cadres régulatoires semblent encore chercher l’objectif qu’ils se fixent: minimisation du coût social, maximisation des recettes, réduction de la taille des marchés illégaux… En prenant comme exemples le tabac, l’héroïne et le cannabis, non seulement la pertinence des propositions de Bertrand Lemennicier est mise en lumière mais se dessinent également les grandes lignes d’un cadre de régulation commun à toutes les substances psychoactives.
The present paper deals with the question whether democratic systems have an inherent tendency towards self-paralysis, which eventually can only be solved through radical reforms and, in fine, violent upheavals. The paper builds on the theory of democracy formulated by Ludwig von Mises in the 1920s. Mises argues that the very purpose of democracy is to facilitate peaceful transitions of power. Its social function is to reduce the necessity for radical reforms and, especially, for violent upheavals of the population against political leaders and even against the entire system of government.
This article contributes to the economics of economics. It explains the distrust of French economists in the market economy and their interest in the construction of techniques to aid public decision-making. French economists are in favor of various forms of interventionism because they are hired by the government to produce the techniques of government that allow the State to replace the contract and the price mechanism and because to be an economist today one must unknowingly adopt a scientistic posture, in other words learn the tools of government economics. The French status quo can partly be explained by this technocratic ideal of government.
« Dans la sphère économique, un acte, une habitude, une institution, une loi n’engendrent pas seulement un effet, mais une série d’effets. De ces effets, le premier seul est immédiat ; il se manifeste simultanément avec sa cause, on le voit. Les autres ne se déroulent que successivement, on ne les voit pas, heureux si on les prévoit. Entre un mauvais et un bon Economiste, voici toute la différence : l’un s’en tient à l’effet visible, l’autre tient compte et de l’effet qu’on voit et de ceux qu’il faut prévoir. » Frédéric Bastiat (1850), Ce qu’on voit, ce qu’on ne voit pas. Abstract: Outre l’économiste érudit, le spécialiste de l’école autrichienne et de la théorie du Public Choice, Bertrand Lemennicier se passionnait pour la prévision en général et la prévision politique en particulier. Dans cet article en forme d’hommage, nous proposons de faire un point d’étape sur les méthodes de prévision électorale, en allant des méthodes non quantitatives aux méthodes quantitatives au sein desquelles les modèles de vote politico-économiques occupent une place éminente. En l’espèce, nous évoquerons la contribution de Bertrand Lemennicier à « l’art » de la prévision électorale.
Résumé Cette étude présente une revue de la littérature ayant trait à la démocratisation sous la menace des révolutions. Elle met en parallèle les analyses arguant que la démocratisation résulte de l’action des élites qui bénéficient de l’extension du droit de vote à d’autres segments de la société. Elle analyse également les tests empiriques qui valident ou infirment les théories de la menace révolutionnaire.
Abstract This paper builds on the critique that Renaud Filleule addresses in this issue to radical ecological economics – known also as socio-ecological economics (SEE) – and more specifically to the works of one of his most famous representatives, Clive Spash. Filleule builds his critique from Austrian economics. I adopt a broader perspective. Indeed, although Austrian economics identifies key caveats of SEE, one may challenge its whole scientific substance on more general grounds. True, Clive Spash’s works are keen on putting forth methodological arguments to institute SEE not only as a scientific theory but also as the major paradigm in ecological economics. However, such arguments are unconvincing, amounting to activism-in-disguise of science, as reflected in Spash’s semantic ambiguity, his misconception of social science and overstated claims and pointless ordering of scientific knowledge. Moreover, Spash’s critique of economic growth is not only empirically wrong – as correctly noticed by Filleule – but also conceptually irrelevant. This is because defective theories necessarily lead to wrong or insignificant statements.
The standard microeconomic analysis of taxation suggests that excise taxes on goods with a price-inelastic demand are more efficient in that they lead to a lower deadweight loss. This argument ignores secondary effects on the rest of the economy. By narrowly focusing on the primary effects on the market where the tax is raised, the overall deadweight loss is underestimated when demand is price-inelastic. Moreover, it is overestimated when demand is price-elastic. This puts into question the validity of the standard argument. In this paper we address this issue from the point of view of causal-realist price theory. Following this approach we can clearly see how the impact of an excise tax is not limited to one market in isolation, but is spread over all markets and affects the demand for cash balances.
Abstract Today’s views and analyses about taxation are dominated by the social-welfare approach based on various categories of utilitarianism, most notably those developed by the optimal-tax literature. By contrast, this paper focuses on the ethical foundations of taxation and analyses a tradition that harks back to the 17th century. In particular, we emphasise the notion of legitimate taxation in the history of economic thought from the libertarian, the classical-liberal and socialist perspectives. By means of this very notion, we define the essence of a desirable tax structure and draw conclusions in regard to today’s tax policies.
Abstract This paper delves into the work of Clive L. Spash, a British radical ecological economist well-known in his field who currently holds a professorship at the Vienna University of Economics and Business. We start with an examination of the principles of his “social ecological economics.” We then critically evaluate his attack on economic growth and his perspective on the standard economic models of climate change. Lastly, we explore his approach to science as a theoretical pursuit and his policy recommendations. The first version of this paper was given as a keynote lecture at the 7th Austrian Economics Meeting Europe, May 12-13, 2023, Université Catholique de l’Ouest, Angers, France, and a second version at the Summer University in Political Economy, July 20-22, 2023, Aix-Marseille University, France. I wish to thank the organizers of these conferences, and also the anonymous referees whose remarks have been taken into account to improve the paper.
Abstract This study endeavors to investigate the theory of the value of money from the vantage point of late scholastic scholars, with a specific focus on the Salamanca School and the two prevailing monetary doctrines: Objectivism (Metallism) and Subjectivism (Chartalism). Our investigation employs the classical works of late scholastic thinkers from the 15th to the 17th centuries to illuminate the perspectives held by the Salamanca School concerning monetary value. The findings affirm that the twofold theory of money value proposed by late scholastic thinkers constitutes a nuanced iteration of the multidimensional approach to money. This comprehensive framework encompasses various facets of value, such as the final, actual, formal, and material dimensions. Moreover, the conspicuous emphasis placed by late scholastic thinkers on the subjective aspects of money value imparts a multifaceted character to their theory, demonstrating striking parallels with modern subjective doctrine.
