What and what is not production

Is there a praxeologic relevance in differentiating between changing what's external to the mind in order to accommodate it to a given scale of values and changing the scale itself in order to accommodate it to a given "external-to-the-mind"?

Yes, there is. A change in the value scale, since is internal to the mind, has no human action manifestation whatsoever.

A change in the outmind can occur by way of either human action or not. Every change in the outmind which brings it closer to the (subjetive) satisfaction of wants is production.

Every successful (in terms of effective satisfaction of wants) human action is at once human action and production. Unsuccessful human action is human action but not production. External changes turning into satisfaction of wants occurred without the concourse of human action are production but not human action.

Every human action aims at production. So, is there a relevant role for the concept of consumption in praxeology? Nope. Consumption is a thymologic, not a praxeologic, concept. There where production ends and consumption begins is the exact frontier between the realms of praxeology and thymology.

Production without human action is production at no cost. (1)

(1) Confront against Israel Kirzner's An Essay on Capital. 1966 -Augustus M. Kelly, Publishers-. Page 5: "Any program of production [...] involves costs." However, here the word program must be interpreted as referring to (by definition deliberate) human action exclusively; this is, excluding "non-human-action production". This interpretation is backed by the sentence in Kirzner next to the previously quoted: "As seen by the economist the cost to [the agent] of the production program that he adopts, consists in the opportunities that he has rejected in order to exploit the program that he has adopted."

Worker and employer: two strong parties

Frequently, the relation between worker and employer is seen as that of a weak party (the worker, of course) facing a strong one (the abusive employer).

In many cases, this is a very misleading picture. Indeed, a more accurate way of describing the relative power of these parties is that of a strong one (the employer) facing an as well strong one (the worker who can dismiss his employer as a new opportunity appears).

The best way of protecting an employer is allowing free competition among firms, a very important part of which is competition for employees.

When the worker is devoid of his power by erecting barriers to entry of competition, then you do have a weak party facing a strong one. This way, abuse turns unavoidable. Passing legislation to supposedly protect the artificially weakened party, too often results in no more than smuggling abuse.

The first battlefront for unions truly moved by the interest of the worker should be tearing down barriers to entry of competition. Owners of firms privileged by protectionism can well lose a substantial portion of profits due to this, but industrious workers have nothing to lose but their chains.

And bear in mind that to expect from an employer unleashed from competition to remain kind to the worker is naivety, pure and huge.

That's an easy one!

The weekly publication The Economist asks what went wrong with economics.

Regrettable though it is, the answer sets so simple: scorning praxeology.

Money proper versus money representatives

There's a distinction praxeologically very relevant to do: money proper and money representatives.

The distinctive feature of money proper, vis-à-vis a money representative, is that money proper absolutely cancels a debt.

The distinctive feature of a money representative, vis-à-vis money proper, is that a money representative serves merely as a sort of IOU. It doesn't matter whether or not the creditor sometime decides to claim debt cancellation. It doesn't matter if the debt is against a specific debtor or against whoever who happens to fulfill certain more or less predetermined requirements. What matters is that a money representative, unlike money proper, doesn't cancel a debt.

This classification doesn't exactly follows Mises's Appendix B to his outstanding The Theory of Money and Credit. I consider Mises's categories as innecesarily tainted by historic development rather than praxeologic relevance.

The rather materialistic distinction between commodity monies and fiat monies is a nothing but a rough approximation to the important distinction pointed out above.

Distinction between money proper and money representatives belongs to the (praxeologic) pure theory of posesion. As such, the institution of legal property plays a major role. This could result in problems to define concrete assets. For instance, I'm not pretty sure if the Costa Rican colones which I carry in my pocket are no liability to anyone or if I could go to court to demand that the Central Bank of Costa Rica give me something in exchange for colones. Currently, as the Central Bank is commited to free sale of dollars (receiving exclusively colones), my colones could somehow be seen as money representatives of dollars proper.

This sheds light on other important aspect of money representation. Effective substitutability requires a reasonable expectation of the price of the credit instrument (money representative) in exchange for the asset which cancels the debt (or alternatively for another money representative, not homogeneous with the original).

As money qua money (this is: without taking into account its use value, but exclussively its exchange value) requires the expectation of it being accepted in an eventual future exchange, it could be argued that money qua money is a representative of something else, that money money qua money is (praxeologically though not legally) nothing but a representative! Ironic as it sounds, this is precisely the core of Macleod's credit-theory of money. (1)

(1) On the difference between use value and exchange value, see Menger's Principles of Economics, chapter VI.

1949

A rich intellectual tradition about to be forgotten.

A lot of wise men compelled to abandon their motherland forever.

Many mocking the now foreigners.

Many treating them as radicals.

Some of the wise men explicitly choosing to deny the old tradition.

Some furtively moving to other fields of research.

A man with the firm conviction of preserving what nobody cares of anymore.

It seems fiction but it's the real-life story of how Human Action was written allowing this way new generations the joy and honor of getting linked to the Austrian School of Economics.

Green policy

A way of spurring tree planting is spending a lot of paper. This will rise tree demand, encouraging suppliers to offer more trees.

Illegal drugs

The one case I have heard of to keep the illegal status of some drugs is the damage on addicts.

However, so far I have never seen junkies in a rally defending the current illegal status of some drugs or fighting for further prohibition on others, say, alcohol or tobacco.

Military lesson from Central America

If you don't have an army you'll never need it. (Costa Rica, Panama)

If you have an army, you will eventually find a use for it. (Currently, Honduras)

A recondite source of money supply

Not only coin minters or check issuers are money suppliers. Every single agent who is in disposition to sell the money he owns adds to the supply of money.

Say's law

If nobody is prepared to buy there can not be sale. Only it is sale where there is purchase.

Keynes could hardly have been more misleading by interpreting Say's law as: "demand is created by supply". (1)

(1) Keynes, Maynard. Preface to the French edition of "The General Theoryof Employment, Interest, and Money". 1939.

Family is not a legal category

Everything which is really meaninful in the family, the mother's affection for his son, the son's respect for his father, the love among brethren, or the spouse's devotion are all values which are not ultimately defensible by compulsory law.

A man can be physically compelled to feed his son but not to love him, to avoid visiting a mistress but not to violate the eight commandment.

The family is based on values, thus can not be defended trough coercion but only through education on values, an education which itself can not be coercively imposed but only voluntarily accepted.

The article 51 of the Constitution of the Republic of Costa Rica accurately (though needlessly) states that the family is a natural element of the society as well as its foundation, however aspires to an utopia when it declares the State as its protector.

To be sure, the one thing the government can do for advancing the wealfare of the institution of the family is to laisser-faire-et-laisser-passer. Everything else is counterproductive.

Family is not a legal category. Therefore it can not be defended through coercion, this is: by government.

Slavery as freedom, under the sacrament of matrimony

Under the sacrament of matrimony, the wife is a property of the husband. This alone would count for common slavery. However, at the very same time the husband is a property of the wife.

Under the sacrament of matrimony, every spouse belongs to itself only through its spouse. The husband is his own owner as far as he belongs to his wife. The wife is the freer the more she belongs to his husband.

Under the sacrament of matrimony, delivering all doesn't mean losing but receiving all.

Under the sacrament of matrimony taking care of the other is taking care of oneself, loving the other is not just like loving oneself but actually loving oneself.

Under the sacrament of matrimony, marriage is the epitome of the Church.

Freedom is daughter of the market

It is not freedom what is a necessary condition for the development of the market. Quite the opposite, is the market order what allows the birth of freedom.

Michael Moore as an equilibrating force of the market

As someone who doesn't understand enough the complexities of the market as to feel himself able to scholarly criticizing it, I can't but feel a deep suspicion of Michael Moore's superficial critiques to the market order.

Nevertheless, I feel obliged to split Moore's criticism to the market system from his complaints to specific companies.

I think that "Moore, The Company Critic" is a way of broadly transmitting information valuable for exchange decisions. In this sense, Moore is a particularly valuable piece in the intricate information complex which we use to call the market.

Teenage motherhood

Currently in Costa Rica there's a policy which looks for teenage mothers to remain in school.

By lowering the oportunity cost of teenage motherhood, this policy is encouraging teenage motherhood.

The more you help a teenage mother, the more you promote teenage motherhood, ceteris paribus.

Costa Rican policy on teenage mothers is a subsidy to irresponsibility.

Oil depletion never to happen

If people don't value oil, they don't extract it, so there's no depletion.

If people value it, they are going to try to buy it. The more the buy, the scarcer it turns. The scarcer it turns, the more expensive it is; so the less demanded it is and the slower it is extracted.

Extraction is going to arrive to a halt before complete depletion occurs.

Mises versus Rothbard on praxeology

From reading and comparing Mises's Human Action and Rothbard's Man, Economy, and State, I conclude that you can learn better praxeology from Mises but more praxeology from Rothbard.

To me, these two books aren't substitute but complementary goods.

Problems are always for free

A situation which an agent wants to be "solved" is always a condition of his environment. Nobody is ever to incur (not even can he) in a cost for something which perceives as creating uneasiness.

Absolutely anything which is perceived as a problem, as something which provokes uneasiness, occurs in itself with no cost to the agent.

It's solution what can be costly.

Systematic failure of expectations

What is fundamentally relevant to answer in praxeology is not how agents form expectations but why expectations can fail systematically.

Since a systematic failure praxeologically analyzable can only occur with respect to the value of money and the interest, an expectations theory is only of avail in monetary theory and in theory of capital.

While a systematic failure of expectations on, say, choice of technology or industry be only viewed as a psychologic or otherwise statistic affair but not liable to praxeologic analysis, this failure is can't be a part of praxeology. By the way, historically people have learnt to avoid this kind of non praxeologic failure of expectations, so these failures tend to be more and more shortlived and innocuous.

The problem with systematic failure of expectations on money value and interest is precisely that the phenomenon is such that experience isn't enough guarantee of protection in the presence of governmental intervention.

Entrepreneur versus worker

The entrepreneur is, by definition, an ultimate decision taker. (1) Entrepreneurial human action is never based on obeying someone else's commands.

A human action undertaken by obeying other agent's command is not entrepreneurial but laboral. This is: labor is a human action commanded by someone else. So understood, labor can't be but social. Robinson Crusoe alone in his island can't be a worker. He'll remain an entrepreneur while not in the company of someone else's who gives him commands.

Human action only can be either entrepreneurial or laboral. The materialistic classification of goods of higher order among capital, labor, and land is an atavism of past political conflicts irrelevant to praxeology.

A command is understood as issuable only by agents and obeyable only by agents.

(1) Compare to Rothbard's Man, Economy, and State, page 64.