These are notes on an original study - something that to my knowledge has not been done before, that is, to draw a link between Schopenhauer's philosophy and neoclassical economic theory. These "raw" notes will be revised and republished from time to time.
Neoclassical Theory is unthinkable without both Schopenhauer’s ethical
metaphysics and Mach’s philosophy of science. And Mach’s philosophy of science
is unthinkable without the “filter” of Schopenhauer’s empiricism and pessimism.
Empiricism is a form of “positivism” – and this is how it will be handed down
to Mach. But not without the all-important “mediation” of Kant’s critique of
Hume and Schopenhauer’s critique of
Kant, after which it will become not just a Weltanschauung but rather a
Lebensphilosophie.
A “World” separates the “truth” of
the British empiricists and Classical Political Economy from the “truth” of the
negatives Denken – contemplative the
former (a stable, immutable adaequatio
mentis et rei that does not challenge the Newtonian mechanistic vision of
reality [Berkeley, Hume] and even of self-identity [Hume]) and the “activist”
notion of “truth” canvassed by the latter (cf. the Cassirer-Heidegger diatribe
over precisely this aspect, with the Neo-Kantians taking the extreme formalist
and contemplative version of Kant’s meta-physics; see also Heidegger on “Das
Wesen der Wahrheit” – and Simmel’s scathing review of “Schopenhauers Metaphysik
des Willens”, ch.3 of “Sch. und N.”), where “truth” becomes an
“Entwicklungsprozess” in the “historial” being of Dasein.
The distinction lies in the fact
that British empiricism from Hobbes to Hume involves a “subjectivism” of both
experience and values (also based on experience) that does not theorise the
relationship of Subject to Object in its “practical” – ethical and political –
dimension. The “empiricist” perspective is entirely “within” the world of human
perception; it does not seek to pose the problem of “the thing in itself” even
when, as in Berkeley ,
it denies its “content” as “matter”. British empiricism is profoundly
“subjective”, its world view is “cinematic” or “imagistic” or “pictographic”
and delivers a “passive, inert, contemplative Subject” more interested in the
theory of knowledge (how we learn things) than in the theory of reality (what
“things” are, in themselves [an sich] and “fur uns”).
Schopenhauer could rightly claim
that Kant’s “grosste Verdienst”
(greatest service) was to distinguish between Erscheinungen (appearances) and Dinge
an sich (things-in-themselves) – because the British empiricists never
inquired into or enquired about “the thing in itself” and the “active” or
“practical” role of the Subject in the “world”. By “separating” Erscheinungen
and Dinge an sich, Kant opened up the entire question of how “truth” is more
than the simple “correspondence” or adaequatio
of the intuition (Anschauung) with
“the thing” (res) by means of the
understanding or intellect (intellectus),
which we call here “instrumental reason” or Verstand.
For Kant as well as for Schopenhauer, “the world” will no longer be something
“to be interpreted”, to be contemplated
or observed from without; rather it
will be a “Wirklichkeit” (activity, worklikeness, actuality) that encompasses
the Subject and its cogito (the “I
think”) as being also an “I will” – whether in its formalistic Kantian or in
its “negative” Schopenhauerian or in its “dialectical” Hegelian or in its
“historico-materialist” Marxian, or indeed in the “evolutionary” dimension favoured
by Schumpeter and Hayek. Nietzsche himself will emend Descartes’s cogito ergo sum to “vivo ergo cogito” (I live therefore I think) to indicate the
precedence of existence and experience over thought and reason. The Subject is
no longer a “receptive” or “reflective” or “regulative” entity: it now yields,
whether in its formal or dialectic or in its “negative (anti-)dialectic” guise,
a “Will” that is either “free” or from which the intellect or “understanding”
(the Verstand/Vernunft of classical
philosophy) has to be “freed” to serve a purely “instrumental” or “operational”
function. The Will displaces Reason from the pre-eminent position that it had
occupied since Plato. Whereas Western metaphysics since Plato had sought to account
for the “totality” of the World, so that the “freedom of the will” became
“freedom from the will”, philosophy
after Kant, and especially in the negatives
Denken from Schopenhauer to Hayek, will seek out the “freedom of the will” – a “free will” that is
either a “freedom to will” or a “will to freedom”, and then a “power to will”
(Pouvoir-Vouloir) or a “will to power” (Vouloir-Pouvoir). This is the
apotheosis of Vichian historicism according to which verum ipsum factum – what is “true” is not some abstract objective
reality but rather the very “doing” (factum) on the part of human beings -, but
this time in “negative” guise, that is to say, the “doings” of human beings do
not constitute a rational sequence, a Progress toward a common humanistic goal,
an inter esse; rather, they are the
record of meaningless strife and irresoluble conflict.
Machism lies at the crossroads of
the discovery of this “processuality”, of not moving beyond the
“instrumentality” of reason (as equal to Verstand
in its mechanical character) whereby not only the perception of the world (Weltanschauung) becomes “subjective”, but
also its entire “unfolding”, its entire “actuality” or “action” or
“Wirklichkeit”, seen in opposition to a static “Realitat”. The whole notion of
“reality” as a “given and immutable world” gives way to the notion that there
is no such thing as “reality” but rather a “becoming”. The empiricists had a
“subjective” perspective on what they still believed and considered to be
“objective truth”, even in the “skeptical” Humean version. But Machism replaces
this “truth” with sheer “functionality” through Schopenhauer’s critique of Kant
and Kant’s critique of Hume – although this fact will be made explicit by
Nietzsche and Wittgenstein, not by Schopenhauer or even Mach himself. (Cf.
Simmel on “Relativitat” and “Traum”, pp24-36.) In other words, British
empiricism confined its subjectivism to epistemology, to how we know, whilst it
still posited the existence of an objective reality whether of “things” (Hume,
Kant) or ideas (Berkeley ).
But the German epigones of empiricism and of classical German Idealism, from
Schopenhauer to Mach, extended this subjectivism to reality itself by
eliminating meta-physics as a
relevant or legitimate field of human enquiry, either because of its
impenetrability (Kant’s “thing-in-itself” and Schopenhauer’s qualitas occulta) or else because of its
pragmatic irrelevance (Mach, Peirce and the American pragmatists).
Schopenhauer’s empiricism becomes
more than “materialistic” or “mechanical”: it becomes “instrumental”, “neutral”
from a “meta-physical” viewpoint – indeed, it becomes “anti-metaphysical” and
“scientific” in its “instrumentality” (“the body is objectified Will”). That is
why, for Schopenhauer, Berkeley ’s
insight that “the world is my idea” cannot be carried deeper than its vague
“universal” tone to the “particulars” of Kant’s analysis (WWV, p.xxv and p.4).
Similarly, Hume’s skepticism is derived from the inability of “experience” –
understood uncritically as “evident” – to yield the principle of causation or
“sufficient reason”, whereas Schopenhauer makes this principle the very
foundation of experience (“On the Four-fold Root of the Principle of Sufficient
Reason””). Hume’s insistence on the need for such “necessary causal link”
between cause and effect betrays the very “rationalist” bias that his
“skepticism” was aiming to explode! Even for Hume, “the world” exists
independently of “the idea (Vorstellung)”
and refers us back to those “objects” that the subject cannot com-prehend. His
ontology is not idealist; his “enquiry” is limited to “human understanding”, to
epistemology, and does not nullify meta-physics.
Hence, realism and idealism face
dogmatism and skepticism in an endless squabble over “the nature of reality and
knowledge” (WWV, pp15-6). Hobbes and Hume, just as much as Berkeley and Kant,
remain in a “realistic” world where objects
(Gegenstande) may well be
“unknowable” or “things in themselves”, and yet they still make “impressions” or “images” on minds. Even in Berkeley’s
idealism, “ideas” need to be “objectified” in God. This is still, albeit in a
“pictographic” form, a Newtonian world in which even subjective “utilities” are
“commensurable” through a commonality of “experience” as in Bentham’s
utilitarian worldview.
This is where Machism and Schopenhauer
e-liminate this “obscure veil” (Nietzsche) that separates human experience from
the world (“the world as Will and Representation [Vorstellung”]) with its obscurantist dichotomy of formalistic
transcendental “Pure Reason” on one side and inscrutable “things-in-themselves”
that we intuit or perceive as “phenomena” and order in accordance with reason,
on the other side. The stated aim of the “negative thought” (negatives Denken) with its new
empiricism and positivism was to abolish this “meta-physics”, this dichotomy or
dualism of Subject and Object (noumenon/phenomenon) and with it to abolish the
notion of “causality” with its Newtonian attributes of space (external
intuition) and time (even in Kant’s version as internal intuition) now made redundant by Kant’s noumena themselves
(!) and to reinstate (Berkeleyan) empiricism: esse est percipi.
Before Schopenhauer, ontology is
still rationalist/deistic, even though epistemology is already empiricist. It
was Kant’s attempt to reconcile epistemological empiricism with rationalist
ontology that prompted Nietzsche’s baleful sarcasm (“Kant is an astute
theologian”). Even as he resisted the heteronomy of instrumental reason, Kant
still believed in a transcendental Reason (Vernunft)
that “regulates” the intellect to the thing. Kant sees the
“technical/instrumental” property of logico-mathematical identities, but these
are then subordinated to, indeed they form the apodictic foundation of, a
“Reason” – a transcendental autonomous entity that is a causa noumenon (Iii of KPV) - because it cannot be itself a
heteronomous phenomenon or appearance - that is transcendent and that “orders”
the world teleologically, has causal truth value, with its ethical-practical
“judgement”. This is the foundation of Kant’s “Dialectic of Pure Reason” that
leads to the notion of “Practical Reason”. Kant mistakenly extends the
apodicticity of logico-mathematical categories (as being synthetic a priori) to
the physical category of “causation”! By so doing, he turns physical causation
into a property of pure reason, independent of noumena in its “reasoning” or
“form” and yet “originating with and prompted by them” in the sense that pure
reason without noumena is “empty form”:- “Thoughts without sense are empty;
sense without concepts is blind”. Only thus can Pure Reason (Vernunft) conceptualise and connect the
various “mere phenomena” (bloss Erscheinungen) it perceives
through its “intuition” (Anschauung) and
orders through its intellect or understanding (Verstand) and link these phenomena into synthetic a priori
judgements or causal laws.
All phenomena have now scientific
status; what science does is to link them together in as simple and economical (and elegant) a manner as is
possible for the description to be useful: simplex
sigillum veri (simplicity is the seal of truth). The problem then becomes
how to erect or construct a “scientific method or language” that banishes
metaphysics and instead links the human observation of physical events with
scientific logico-mathematical propositions that record reliably/truthfully the
regularity of those events. So even in the Machian conception of science and
experience, logical propositions and scientific statements are intimately
connected. The question was to establish the precise nature of such connection
– the Scholastic “adaequatio mentis et rei”. Wittgenstein and the Wiener Kreis
on one side and Husserl on the other.
Utility, Labour and Wealth – from Smith to Schopenhauer to Neoclassics
The Will and its instrumental
reason (Verstand), as understood by
Schopenhauer, “work” reality/actuality, they “labour” the World, the
subject/object of representations, to satisfy a “motivation” that is a “need”.
This is the operari, the
“consumption” of the World on the part of the Will. In this operari there is no telos, no “qualitas occulta”
(hidden quality or “ultimate cause”, Sch., WWR, p.106), no “causa finalis” in the endless chain of
causation (samsara, the cycle of life) that is the veil of Maya (illusion).
“The Will” is the “objectification of the Ding
an sich”: but “Work” is the “motioning” of the Body, which is “the
objectification of the Will”: it is meaningless motion (the Wirklichkeit of Vorstellungen), effort and toil – “dis-utility” or “pain” (cf.
Hagenberg on Gossen!). Work is “consumption” of the World, and in this
“consuming” it does not have “utility”. “Utility” is to be found “in the
things” as they relate to “the Will as operari”,
in the pro-duct of work, but work itself is only operari, consumption of the “means of work”, of the “means of
production”. (This logical sequence may well be why Gossen’s early Fundamental
Law that still privileged “labour” was untenable for Jevons and his epigones)
Although it pro-duces wealth
mechanically, the worker or labourer uses
the means of production as well as his own body. But whereas the means of
production have “utility” to the extent that they help pro-duce new objects of
“utility”, work itself is an “effort” to the labourer and is therefore a dis-utility. Thus, work is neither the
“measure” nor the substance of wealth, but rather an expense, a consumption, an erogation of “Leid/Kraft” (pain/effort). The source of wealth must then be
“negative”: wealth is not pro-duced
but conserved, though it can be
accumulated; wealth is consumption a-voided or post-poned/delayed: wealth is
“saving”, it is “ab-negation”, ab-stinence, the refraining from or delaying of
consumption.
It is impossible to understand
Bohm-Bawerk and the Austrian
School , starting with
Menger, without understanding Schopenhauer. But even in Smith we have the
beginnings of this “empiricist” philosophy that can be traced back to Hobbes.
In Hobbes’s “mechanicism”, the living activity of human beings is already
described as a “Power” that can be used and appropriated mechanically. Wealth
is not “pro-duced” by labour, because wealth too is a “Power” that can subjugate
and appropriate the labour of others by means of “possessions” that are another form of “Power”.
Wealth or possessions (from Latin potestas, power over things) allow their
possessors to exercise “power” or influence on those who do not possess them. Thus,
labour is the “price” (the “dis-utility”!) that must be paid for the “utility”
of consumption, which is the “wealth” represented by the
“Lebensmitteln”/Viktualien (food) and the means of pro-duction: these are what
“give life”, “the means of life” (Lebensmitteln).
It is the employer, the owner of wealth/capital who “employs”, who “gives work”
(he is the Arbeit-geber or employ-er
of) the worker; and it is the worker who “takes work” (Arbeit-nehmer, employ-ee) from the employer. It is not the worker
who “gives labour” in the sense of “wealth-creating force” to the employer.
Furthermore, “utility” represents
analogously the “principium individuationis” of Schop.’s “will” and its shapeless,
protean subjectivity, its “fungibility” or “malleability”, hence its
“exchangeable” (Simmel, “wechselseitig”) character because of its
“manifestation” or “objectification” in any object or reality or “representation” (Vorstellung). Not to
mention, of course, the “insatiable” nature of the Will, again analogous to
that of accumulation. The attempt to avoid this “bottomlessness” is what moved
Hayek to distinguish the notion of “individual” from that of “in-dividuum” (in
‘CRS’). Hence, the notion of “utility” already constitutes the “in-dividual” in
its unbridgeable, impenetrable “subjectivity”, whereas “labour” contains
immediately the concept of “inter-action”, of “social labour”. Consequently,
economic science must start with the concept of “utility” if it wants to
present social life as market exchange between atomized “in-dividuals”. Any
economic theory that begins with “labour” will eventually encounter the problem
that there is no such thing as “individual labour” and that indeed all labour
is necessarily social labour.
Thus, “prices” do not require a
search into “utilities”. Indeed, the very “subjectiveness” of “utility” is
consistent with the usurpation of “the world” by “the Subject” for whom alone
“the Object” is now posed (not “exists”, for this question is “inconceivable”
given the relation/unity of the Object with the Subject in the Vorstellung, representation). The
“relationship” between Subject and Object is now entirely “internalized”,
“introspected” away into “mere mechanically ordered phenomena” because this is
the status of ‘Vorstellungen’.
“Reality” is now indistinguishable from “dream”; it is replaced by sheer
“action or movement or displacement”, by “Wirklichkeit”
where the nexus with “work/conatus” is evident.
Ultimately, “exchange value” or
“value” must be re-translated into “command over living labour”, into a
specific “employment” of living labour. But the brutally crude fact is that
“command over living labour” (value) is dependent on the “political control” of
use values (including “material resources”!); and this opens the way to a total
re-formulation of the “nature and causes” of value in terms of “the market”,
that is, in terms of the ability of “goods” to satisfy individual
incommensurable “wants”. The proto-neoclassics (from Roscher and Knies to
Dupuit to Gossen) therefore “invert” the Classical and Marxist analytical
perspective: they easily take the existing relations of property for granted
and proceed to calculate empirically
the role of the market in “satisfying wants” given the existing structure of property (“endowments”).
Given this existing structure of property, of “endowments”, it follows
that “labour power” is a “dis-utility” in that the worker needs “to consume the
means of pro-duction”, including its body, in order to pro-duce “goods” that
allow its reproduction. The “utility” of these goods lies in the satisfaction
of the worker’s “wants”, one of which is survival. The meaning of “wealth” then
is “stored resources”, delayed consumption: wealth is no longer
“embodied labour power” because this would mean that only “labour power” can
pro-duce “wealth”. Rather, “wealth” is “renunciation” of “the immediate
satisfaction of wants”; wealth is sacrifice or Vernichtung, annihilation/suppression of the “Wille zur Leben” –
something that is not done “in contemplation” but in the “active, effective
renunciation” of the will to life. Nirvana is not a terminus ad quem, a summit, an apex to be reached “at the end”,
that involves the “renunciation of action”. On the contrary, Nirvana is “the
active satisfaction or extinction of ‘wants’ through their renunciation”,
through the “accumulation of wealth”, of “resources”! Not renunciation of this
or that want: as Robbins insightfully put it, “Nirvana is the satisfaction of all wants” – that is to say, the total
extinction of want.
Roscher and Knies still attribute
“exchange value” in terms of “the ability to satisfy wants” to “goods”, “the
object”, to the “thing-in-itself”. (This is part of the “emanationism”
[Parsons’s translation] that Weber criticized as a Hegelian residuum in Roscher-Knies.)
Therefore, it still makes sense to ask “how the goods are pro-duced”, and to
regress to “labour-power” or Arbeitskraft.
Gossen’s initial Fundamental Theorem starts from this “Ptolemaic” perspective
because it measures the utility of goods against the marginal utility of the
labour-power applied to their production. Later, however, he will invert this
perspective to sever once and for all the link between “goods” as a “pro-duct”
and “goods” as “endowments” that are judged/valued according to their “ability
to satisfy individual wants”, and therefore in terms of these “subjective”
individual wants which are “inscrutable” except through the “willingness of
people to pay money for them” (Dupuit and JB Clark, as well as Gossen). Now
“labour” is no longer the “nature and origin” of wealth but simply another
“negative good” to be “exchanged for goods with the ability to satisfy the
worker’s wants”. Labour becomes, not the “source
of value”, but rather “the consumption
of value, of the world”, of “resources” (“wage funds”), and therefore
“immediate consumption”, non-Entsagung,
enslavement to the world (mundanity),
not deliverance from the world!
We note that the “economy” of the
“Principle of Sufficient Reason”, its bland and ruthless reliance on the
irrefutability of the “phenomenon” (Erscheinung)
as the basis of human “scientific causal explanation” of events through the
action of the intellect (Verstand) understood
as purely instrumental reason, as against
teleological or divine Reason, - quite simply, an empirical “tool” that orders
our Vorstellungen or
“re-presentations” of reality – this “economy” in representing the “relativity” or “subjectivity” of
market prices, in denoting “objectively/socially” values that are entirely
“subjective” – this economy is also the “economy” involved in the principium individuationis that allows
Schopenhauer “to isolate” the “selfishness” of the Will to Life in its
irrepressible striving for its own
“interest”, without having to give it any “self-identity” or “self-awareness”
or “self-consciousness” that would then engender the “dialectical” notion of inter-esse or inter-subjectivity or
inter-action on which Hegelian and Marxist philosophies are based. In both
cases it is the “empirical/perceptive/intuitive im-mediacy” of these notions
(reminiscent of Hegel’s hic et nunc
or Bertrand Russell’s “sense-data”) that allows Schopenhauer to regress to the
jejune concept of “human nature” in the ‘Grundprobleme
der Ethik’. (Note, incidentally, on the theme of instrumental reason, Joan
Robinson’s definition of Economics as “a box of tools”, reprised by Schumpeter
in the History, but now attributed to
Pigou by Geoff Harcourt in “J. Robinson’s Early Views on Method”.)
[Discussion of Sraffa and
Wittgenstein in Sen.]
Similarly, “utility” exists only
in the relationship of individuals to “things” and can only be defined
“materially or objectively” in relative prices. The resultant “relativism” is
unlike that of Einstein’s theory, but rather more like Schopenhauer’s
“Principle of Sufficient Reason” according to which causation is an endless
chain given to perception immediately, without necessity or contingency.
(Cf. Cacciari, Krisis, p.24: “Al di fuori di questa
analisi [neoclassica di Bohm-Bawerk] non poteva darsi nulla: nessuna ‘misura teorica’ o ‘legge del valore’. I rapporti di valore erano
immanenti e relativi alla struttura del ciclo”. See also
Simmel regarding the “Funktionen, d.h. in Relativitaten auf und verdanken sich wechselseitig alle ihre Bestimmtheiten,”
p27 in ‘Schop. u. Nietzsche’. For distinction with Kant’s “absolutism”, see
p24.)
The very subjectivity and
ineffability of the notion of “utility” – the utilities of individuals can
neither be compared nor measured, they are heterogeneous
- gives much greater scope and weight to “the market mechanism” as a tool of
social and not strictly “economic” regulation. It is the “self-regulation” of
the market, its ability to reflect the “individual choices” of members of civil
society that determines not just its Economic rationality but also its
Political desirability, its osmotic function as “co-ordination” of the “free
choices” of individuals. (Cf. Hayek on one side and Walras on the other. It is
obvious that the “subjectivist” notion of utility ultimately clashes with the
“determinist” straitjacket of “general equilibrium”, especially at a
“microeconomic” level – cf. Roscher’s reservations against the “idealist
method” in favour of the “historical” one, in Principles of PolEcon.)
This may be the place to emphasize
that “utility” is a singularly “subjective” metaphysical (the euphemism used is
“psychological”) notion that can have no meaning outside of its “empirical”
manifestations – relative prices.
But Smith’s notion of “wealth” is
entirely different from “utility” when he privileges “the labour theory of
value”, which is not dependent on the notion of “equilibrium” except in the
Marxian sense of “simple reproduction”. The reference to “nations” gives
Smith’s notion of “wealth” a far more “sociological” and “objective” flavour
than “utility”.
This is a feature shared by the Old and Young German Historical Schools,
whose notion of a Volksgeist was the real source of the “Methodenstreit”.
(Roscher, for instance, in dismissing Gossen, notes the impossibility of
measuring individual “utilities” for the economy as a whole [pp103-4] –
revealing again his “objective” understanding of the notion – and dismisses
also “the idealist method”, its “algebraic formulae” and “caeteris paribus”
calculations which display a harmful scientistic reductionism against the
spontaneity of “peoples” [see up to p110].)
Note Hagendorf on Gossen: ‘Bourgeois economists since Jevons always
speak of marginal productivity of labour instead, as “labour value” is
considered a “dangerous” concept.’
But note also the following in Papadopoulos,
‘Karl Knies’:
In the quest to find Karl Knies’s contribution to
the emergence of marginal utility theory, one can find a reliable source in the
writings of Carl Menger himself, the founder of the Austrian branch of
neoclassical economics. In Appendix C of his first and most famous publication,
Principles of Economics13, Menger makes direct reference to Knies’s
aforementioned “richly suggestive essay” on value, criticizing, nonetheless,
several parts of his theory, which he evaluates as leading to “doubtful
conclusions.” First, he alludes to Knies’s
definition of value as “the degree of suitability of a good for serving human
ends,” to which he objects because he says that it confuses the nature of
value with the measurement of value: “the measurement of value belongs as little
to the nature of value as the measure of space or time to the nature of space
or time” (Menger 1950, p.293). Thus,
Menger understands Knies to attribute inherent value to goods, which obviously
cannot correspond to the psychology of the newly born (Austrian) neoclassical
methodology14. (pp14-5)
After Schopenhauer and Nietzsche,
through to Machism and the neoclassics, the individual becomes a Unicum, echoed in Stirner’s The Ego and Its Own, a bottomless pit or
black hole of “utility/will” in which “truth” is only an instrument and no
“common-ality” or “inter-esse” is epistemologically possible. As Cacciari puts
it,
“I neoclassici definiscono un
sistema generale d’equilibrio [di mercato]… che parte dalla individualita’ economica concreta e ne
segue lo sviluppo fino alla costituzione di un sistema che non e’ se non
l’incontro, empirico, impotente a operare qualsiasi metamorfosi, tra gli interessi
specifici di ogni individualita’” (Cacciari, p29)
These are interests that will
remain inscrutable and insubstantial except as “empirically observable” relative prices. How to reconcile or
“co-ordinate” these interests through
“relative” market prices will become the principal problem of economics either
“providentially” (Smith’s “invisible hand”) or abstractly (Walrasian General Equilibrium)
or “a priori” (Misesian praxeology and its neo-Kantian concept of homo agens, game theory, rational
expectations) or technically-empirically in relation to a General Equilibrium
framework (Hayek’s and Robbins’s “science of choice” with its homo quaerens) or through “evolutionary
institutional factors” (immanent, in Hayek and the New Institutional Economics,
or transcendental, in Schumpeter’s “innovation”).
In this regard, the neoclassical
notion of “the market” has an uncannily “democratic” structure in that it
excludes theoretically “accumulation for its own sake” and “concentration” as
its “monopolistic” aberration (contra Weber’s protestant work ethic where
individual accumulation and anti-competitive behaviour are seemingly
unrestrained, even “ethically” – see below) by allowing the “social
synthesis/osmosis” or the “reconciliation” of “subjective interests or utilities”
through the self-regulating price mechanism.
The “equal exchange” that the
market pricing mechanism serves to establish allows a co-ordination of
individual activities in the sphere of material reproduction of society that
can preserve the private ethical beliefs and customs of “individuals” whose
“material self-interest” can be given “rational-scientific” free rein in the
market whilst the Political sphere is kept well out of the ambit of individual
beliefs. The market therefore achieves a double “equilibrium”: - by ensuring
“equal exchange” and optimal satisfaction of individual “utility” in the
material sphere, it preserves individual “freedom of expression” in the
cultural sphere. It is the “scientific” rationality of the market, its ability
“to maximize” the “wealth/utility” of the nation that permits the neutrality of
the Political with regard to other spheres of social life. The bourgeois can
co-exist with the citizen in light of this “rationality” of what can then be
called appropriately “Political Economy” – an oxymoron for Antiquity, as Arendt
reminds us (in The Human Condition)
in that the “Political” is reduced to privatistic Volkswirtschaft and the latter is erected to the only appropriate
real sphere of “individual choice”! Similarly, Weber’s “Protestant ethic” is
marginalized in the wider, now irretrievably “secular”, neoclassical market
equilibrium (see discussion below).
I know this is very, very late, but as it is said, better late that never. Good notes, I appreciated overall the Menger-Schopenhauer connection. Im a Schopenhauer thankful reader, and I incline towards Austrian economics. Your notes help me to make connections between both.
ReplyDeleteAlso id like to add, I have always used Schopenhauer´s theory about private property to justify private property. The private property becomes property when you have worked it (for example, in the soil worked we have "expend" our own volition-will). But, you can lend that property to others for work. That´s why property is not of the workers, but of the originals owners.
In fact Schopenhauer´s solutions are so clearly and elegant that it is strange to say the least that there have not been a good revision about it. But again, the prosperity and equitity that capitalism brings is also very clear, but academics and ignorant people tends to champion socialism. So, in fact Schopenhauer´s prediction comes to fruition once again: after all we are irrational beings.
Thanks, cheers from Perú.
But there are many people above the voting age who have little or no interest in elections and are not conversant with social or economic issues. Paskolos Internetu
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