The Austrian Anthropology

Austrian economics does not reduce people to mechanisms like most other forms of economics do. While the Austrian perspective is still to approach economics as a positive rather than a normative science, it avoids numerous pitfalls by simply not making simplifying assumptions about people internally and the way they make choices. Rather than boxing people into predictable utility-maximizing decision units, Austrian economics lets people value things subjectively and recognizes that the price of anything arises from how it fits into people’s goals. It does not attempt to understand the nature of human striving and leaves room for it rather than trying to compress it for the sake of predictability. The human is assumed to have actual agency: something almost unheard of in the social sciences. Humans, rather than external forces, are understood to be the foundation of social order, and this shifts the focus from central control to the allowance of emergent coordination.

The Austrian school typically holds that human wants are subjective, and this lets each person be uniquely their own and incomparable. While other systems of economics would hypothetically allow for comparisons about the utility of different people, Austrian economics recognizes that each person‘s aims and utility are fundamentally unable to be compared to the aims of any other. This belief makes central planning, not only practically but morally difficult as it denies the building blocks needed to justify societal utility maximization. This is not to say that an Austrian economist cannot argue that one person’s subjective evaluations are better than others, but it lets that be a discussion for a different discipline. The Austrian school merely creates a baseline that is robust to whatever people believe about human action, recognizing that to do anything else would be to enter a metaphysical realm that economics is not fully suited for. Other forms of economics lose credibility and gain the power needed to coerce people into action when they form very specific beliefs about a human person masked as science.

Humans are assumed to have actual agency and are seen as doing more than responding to environmental stimulus. People actually have the ability to act in a way that would be unpredictable based on their biology and situation. Human unpredictability is one of the most important dividing lines between Austrian economics and other forms of economics. The matter behind the material world is infinitely divisible, and the human mind is even more complex. The Austrian method avoids the great fallacy of our age by avoiding overconfidence in the scientific method. People cannot ever be perfectly predicted as long as they are given freedom and systems that do not recognize agency have a tendency to restrict it. If people’s actions are truly only a result of their environment, then how can we argue that freedom is a good in the end of itself. However, if freedom is a sacred quality which runs through the heart of every human, we must recognize that it is to be prized over almost every other thing. People can act randomly,  unpredictably and make choices to go against the environment they were formed in. A strong belief in human agency is needed to protect against tyranny of all forms, and Austrian economics has it.

Both of these factors force us to recognize that the individual is at the heart of any institution. The individual can join their sympathies with those of other individuals, but the external factors are only the stage on which individual actors play out their aims. This understanding shifts one’s perspective from trying to create good things with government and institutions to instead trying to enable them. When institutions loosen their vice grip on the people and seek to allow for a broader range of good outcomes, they are able to allow for freedom, much more effectively. To see the form of the state itself as the source of the state’s success will inevitably reduce the freedom and responsibility of the people. The future can only poorly be predicted and institutions that allow for human freedom to form emergent order over time will adapt to the future far more effectively than those that seek to impose their vision upon the world. 

The Austrian school operates from an anthropology, which elevates the human person far beyond what other schools of thought restrict the human to be. It does not assume anything about how a person thinks but rather understands that it is unknowable and gives them the freedom to do so. Starting from the individual rather than the collective allows choices in governance that are better for the one and the many at the same time. While Austrian economics is foreign to those in the mainstream, its truth will only continue to make itself evident.