Economic Theory and Theory of Action

Abstract

Economic reality shows the characteristics that the Parsons’ theoretical model seeks to explain. Economic reality is, in itself, dynamic and complex. In this chapter we will seek to expound the theories of L. von Mises, whose aim was to base economic science on a general theory of action. Thus we will show how the desiderative, cognitive and evaluative elements of individual action are internally related.

The economic principle has to be something more radical than the choice of the ends and the means, independently of whatever these ends and means may be. This principle is the reality of having to discover a structure of means and ends, of having to choose between different ends and opt for one of them, while renouncing the others. The basic element for Mises is the irreducible axiom of human action. The second step will be to clarify the prerequisites of action: preference. The third step will be to analyze how these prerequisites imply the causal category, so as to discern within the means-ends relationship. The fourth and final step will be to explain the sequential character of the causal relationship. The conclusion reached by Mises is that action is a temporary preference perceived as a means-ends relationship.