As part of last night's "Think Global, Act Local" panel at Rhodes, we had a discussion of the motives for action. Here's an assessment by one of my co-panelists, who nails it. The panel illustrated nicely some of the points Thomas Sowell makes in A Conflict of Visions. The students who organized the panel are to be commended for putting together an absolutely fantastic discussion that featured real and meaningful disagreement between people of good will who are earnestly and intently interested in discovering truth.

I argued that by our nature we engage in calculation--we compare costs (what we give up) with benefits (what we get) and act accordingly. One of the most unfortunate and enduring myths about economics is that it is about money and material ends to the exclusion of other values. It isn't. Monetary and material considerations are a subset of properly "economic" problems. Economics is an exercise in the logic of choice, which is necessitated by the fact that our values and wants are infinite but the resources (knowledge, matter, time, etc) available at any point in time are finite. Further, people have conflicting values and conflicting plans that have to be reconciled somehow. Economics is not in a position to evaluate people's ends or values. Economics as such cannot tell me whether it is good or bad in any moral sense to consume more today or save more for tomorrow. Economics can trace out the implications and consequences of these choices.

Any choice means that we will incur a cost and receive a benefit, by the very nature of choice. This is a fact of action rather than a prescription or worldview. Anamaria Berea, Jeremy Horpedahl, and I explore this in a paper on James Buchanan's Cost and Choice and F.A. Hayek's The Sensory Order.

Perhaps serendipitously, I started re-reading Ludwig von Mises's Human Action yesterday (which was also his birthday). It's the first time I've read it since my first year of grad school; after about sixty pages I'm blown away with just how much of an intellectual tour de force it is. Mises places economics within a broader category of the sciences of human action (praxeology) and in turn places the sciences of human action within the broader framework of human knowledge. A few choice passages that speak to action and calculation (and that clarify my point from last night) are below the fold.

Page numbers refer to the Scholar's Edition, published in 1998 and reprinted in 2008 by the Ludwig von Mises Institute in Auburn, Alabama.

"The general theory of choice and preference goes far beyond the horizon which encompassed the scope of economic problems as circumscribed by the economists from Cantillon, Hume, and Adam Smith down to John Stuart Mill. It is much more than merely a theory of the 'economic side' of human endeavors and of man's striving for commodities and an improvement in his material well-being. It is the science of every kind of human action. Choosing determines all human decisions. In making his choice man chooses not only between various material things and services. All human values are offered for option. All ends and all means, both material and ideal issues, the sublime and the base, the noble and the ignoble, are ranged in a single row and subjected to a decision which picks out one thing and sets aside another. Nothing that men aim at or want to avoid remains outside of this arrangement into a unique scale of gradation and preference. The modern theory of value widens the scientific horizon and enlarges the field of economic studies. Out of the political economy of the classical school emerges the general theory of human action, praxeology. The economic or catallactic problems are embedded in a more general science, and can no longer be severed form this connection. No treatment of economic problems proper can avoid starting from acts of choice; economics becomes a part, although the hitherto best elaborated part, of a more universal science, praxeology." P. 3

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"Praxeology asks: What happens in acting? What does it mean to say that an individual then and there, today and here, at any time and any place, acts? What results if he chooses one thing and rejects another?

"The act of choosing is always a decision among various opportunities open to the choosing individual. Man never chooses between virtue and vice, but only between two modes of action which we call from an adopted point of view virtuous or vicious. A man never chooses between 'gold' and 'iron' in general, but always only between a definite quantity of gold and a definite quantity of iron. Every single action is strictly limited in its immediate consequences. If we want to reach correct conclusions, we must first of all look at these limitations." p. 45

On low-hanging fruit and the "think globally, act locally" concept:

"The road to the performance of great things must always lead through the performance of partial tasks." p. 45