Theory and History: An Interpretation of Social and Economic Evolution

by Ludwig von Mises, Bettina Bien Greaves (Editor)

Ludwig von Mises was the leading exponent of the Austrian School of economics throughout most of the twentieth century. He has long been regarded as a most knowledgeable and respected economist, even though his teachings were generally outside the “mainstream.”

Theory and History is primarily a critique of Karl Marx, his materialism, and his prediction of the inevitability of socialism. Marx attributes the creation of tools and machines, as well as the economic structure of society, to undefined “material productive forces;” Mises rejects this materialistic view; he points out that tools and machines are actually created by individuals acting on the basis of non-materialistic ideas.

This book discusses the theory of economics, i.e., the study of purposive human action, and with history, the record of the past actions of individuals. All actions are determined by ideas. Thoughts and ideas are “real things,” Mises writes. “Although intangible and immaterial, they are factors in bringing about changes in the realm, of tangible and material things.” Rather than rejecting the study of historical change as a “useless pastime,” Mises considers it of the utmost practical importance. “History looks backward into the past, but the lesson it teaches concerns things to come.” History opens the mind to an understanding of human nature, increases wisdom, and distinguishes civilized man from the barbarian. Moreover, historical knowledge is of the utmost importance in helping to anticipate and plan for the future.

Though Theory and History may not be studied as often as other, more popular Mises works, it provides great insight into Mises’s fundamental thoughts and is a fascinating exploration of human action. 

Ludwig von Mises (1881–1973) was the leading spokesman of the Austrian School of Economics throughout most of the twentieth century. He earned his doctorate in law and economics from the University of Vienna in 1906. In 1926, Mises founded the Austrian Institute for Business Cycle Research. From 1909 to 1934, he was an economist for the Vienna Chamber of Commerce. Before the Anschluss, in 1934 Mises left for Geneva, where he was a professor at the Graduate Institute of International Studies until 1940, when he emigrated to New York City. From 1948 to 1969, he was a visiting professor at New York University.

Bettina Bien Greaves is a former resident scholar, trustee, and longtime staff member of the Foundation for Economic Education. She has written and lectured extensively on topics of free market economics. Her articles have appeared in such journals as Human Events, Reason, and The Freeman: Ideas on Liberty. A student of Mises, Greaves has become an expert on his work in particular and that of the Austrian School of economics in general. She has translated several Mises monographs, compiled an annotated bibliography of his work, and edited collections of papers by Mises and other members of the Austrian School.

Genres: Economics, Philosophy, History, Politics, Nonfiction, Sociology, Science

281 pages, Paperback

First published January 1, 1957

About the author

Ludwig Heinrich Edler von Mises (German pronunciation: [ˈluːtvɪç fɔn ˈmiːzəs]; September 29, 1881 – October 10, 1973) was an Austrian economist, historian, philosopher, author, and classical liberal who had a significant influence on the Austrian government's economic policies in the first third of the 20th century, the Austrian School of Economics, and the modern free-market libertarian movement.

Reviews

[Patrick Peterson · Rating 4 out of 5]

2021-04-21 I listened to most of this fine recording of this book complete once and then many sections again over the course of a long couple drives I made over the last week. Excellent. It made the miles fly by and was so timely in so many parts, that I was actually fairly surprised.

I originally read this book sometime in the early 1980s, I believe. I liked it, but did not love it. It was a bit more than I could handle in some respects then, and now, but much more then than now. Age, experience and being more conversant with the ideas the book discusses has indeed made a difference.

Just some of the things the book covers well that are highly relevant these days:
- how anti-capitalists use the term/idea "justice" (or "social justice") for their own nefarious purposes, NOT really trying to communicate a sincere belief or understanding.

- how pernicious the philosophy of the "equality of wealth &/or income" has been over the years, with even Thomas Jefferson succumbing to the chimera

- The difference between and the need for the dual methodologies of science - for the physical world of "rocks and atoms" vs. the science of praxeology (Human Action). This was covered in his great book "Human Action," but this book does add significant ideas and examples to help clarify it, as well as showing the absurdities of the economics profession's thinking it can use the positivist methodology on human action.

This edition of the book has a glowing preface by Murray Rothbard who claims that this book is Mises' 4th great work, after, "Theory of Money and Credit", "Socialism" and "Human Action". Possibly. But Rothbard says it is his great statement on "methodological dualism" for economics. However, Mises covered that subject very well in Human Action too. Rothbard said it was great because it contained Mises' critique of positivism and scientism. Well, Mises handled those in "Epistemological Problems in Economics", "Human Action" and "The Ultimate Foundation of Economic Science". So I am not sure why Rothbard thought this book was so great. But I did find it of value, and it did have plenty of new material.

There seemed to be more in this book than any other place in Mises' works that I can remember on:
- philosophies (theories, cycles, predictions, etc.) of History - Spengler, Marx, Toynbee, etc.
- discussion of Marx and Engels on various aspects of their using ad hominem/"defamation" attacks on their opponents, not dealing with the arguments themselves, since they knew their own positions were too weak to defend - See how relevant that is today?
- dialectical materialism, Hegel and Marx - the basics, the reasons Marx picked it up but modified Hegel's ideas and the huge contradictions within Marx's writings and how Marx got away with them
- discussion of reason vs. faith in dealing with the world
- evolution - neat stuff
- social Darwinism & competition within a species - some excellent clarifications, but also some areas I am not sure about.
- natural rights - what is correct and timeless about the concept and where the ideas/supporters go wrong.
- equality - before the law vs. "of income and wealth," as well as the idea that all people are created equal at birth, and repercussions of holding that idea. This is a crucial subject for those who mindlessly spout adherence to the Declaration of Independence phrase.
- equating "progressivism" with Marxism - unmasking and knowing what this is and how to deal with this is very important
- his definition of justice - not sure it is anywhere else in his works - I remember not liking his definition the first time I read it, but now 30-40 years later, I am much happier with it, and see how much real value it provides.
- several references to Hume, positive and negative - his idea that "all governments are essentially the few ruling the many" and how that understanding changed thinking about and discussion of the issues from then on, at least for some significant number of serious writers.
- Mises' note that "public opinion is the key tyranny/despotism" per De Tocqueville and JS Mill - too few conservatives, let alone leftist statists/collectivists/"progressives" realize this today.
- discussion of freedom vs. tyranny, especially with respect to: Hegel/Kant/Lenin who flipped the terms - with too few understanding the flip and too many aiding and abetting it. For a great application of this "flipping" issue today, think of AntiFa (AntiFascist) movement, and how they are actually PRO-Fascist in their methods and goals.
- "truth" being what the majority/democratic power (no matter how corrupt) wants, as long as they can get away with it - as opposed to what actually exists in reality.

Unfortunately, there were some technical problems with the MP3 copy that I downloaded from Mises.com:
1. The end of track 3 was cut off mid-sentence, so I bet there is more (have not had time to be able to tell how much) that I missed.

2. Track 4 also ended abruptly, so I bet some of that was cut off and missed too.

3. Track 9 ends abruptly too :-(

But overall, this is a very worthwhile book to listen to, if you have any interest in or appreciation of the issues noted above. There is much more too that I did not have time/space to mention! This book was published in 1957, but as is so typical of Mises, just as relevant, or possibly even more relevant today than 64 years ago!

2021-08-27 - edited/updated

[Patrick Peterson · Rating 5 out of 5]

2021-04-21 - I read this edition in the very late 70s or early 80s.

Since I can't remember too much about what I thought about the book then, I urge you to see my other review of the audio book edition, that I just wrote about a few minutes ago.

There are definite benefits/drawbacks to each edition for sure.
This hard copy edition has the following benefits over the audio version:
- MUCH better for reference
- Much easier to reread, ponder, cross-reference, etc.
- Index
- footnotes
- etc.

This edition does NOT have Rothbard's Preface.

[Allen · Rating 5 out of 5]

I listened to the audio book over the past month. I loved this book because it satisfied a desire I have had for a while - to learn about important philosophies and their interpretations of history and economics. I give some highlights below in my own words, though they are not connected as well as they are in the book. The material and its presentation are just my cup of tea and I highly recommmend this book to anyone interested in these topics.


Von Mises believes individuals, their "judgments of value", and their actions are the ultimate data of human history. Ideas are generated and evaluated and actions taken by individuals. Acting man is not governed by the same laws as stones (physics), trees (chemistry), or animals (instincts). Instead, man uses reason to decide what means would best justify his desired ends. Also man, as a "social animal", has decided to voluntarily cooperate with his fellow man and thus improve his level of existence instead of simply competing against his fellows as is the case for other forms of life. Man always seeks to replace his current condition with one that better suits him (longer life, better health, etc.). The ends sought are subjective and ultimate and are unable to be analyzed by reason - they are his "judgments of value". Different men do not respond to the same stimuli in the same way and may not respond the same way in the future. It is impossible to predict the future based on past trends or worldviews that have been discredited by "discursive reasoning". Specifically, von Mises attacks Marxian socialism using logic and historical results. He argues against the idea that history is irreversibly progressing toward continuous improvement of material well-being and an inevitable ultimate utopian socialist world order. Economic progress can and has stagnated in the past. Nations have risen to greatness and then fallen over and over in history. Von Mises argues that captialism is responsible for the highest level of material well-being enjoyed by more common people than ever before.

The author's writing is very methodical and his arguments logical. He highly values logical consistency and criticizes the inconsistent practice of the various philosophies discussed. Austrian by birth, von Mises wrote during the mid-twentieth century being an atheist of Jewish ethnicity. He fled the Nazis to the U.S. His full bio can be found here: http://mises.org/about/3248

[Renegade · Rating 5 out of 5]

One of the best works in Praxeology and Philosophy of History.

"Behaviorism proposes to study human behavior according
to the methods developed by animal and infant psychology. It
seeks to investigate reflexes and instincts, automatisms and
unconscious reactions. But it has told us nothing about the
reflexes that have built cathedrals, railroads, and fortresses, the
instincts that have produced philosophies, poems, and legal
systems, the automatisms that have resulted in the growth and
decline of empires, the unconscious reactions that are splitting
atoms. "

"Grumblers may blame Western civilization for its materialism
and may assert that it gratified nobody but a small class of
rugged exploiters. But their laments cannot wipe out the facts.
Millions of mothers have been made happier by the drop in
infant mortality. Famines have disappeared and epidemics have
been curbed. The average man lives in more satisfactory conditions
than his ancestors or his fellows in noncapitalistic countries.
And one must not dismiss as merely materialistic a civilization
which makes it possible for practically everybody to
enjoy a Beethoven symphony performed by an orchestra conducted
by an eminent master. "

"Man is not the member of one group only and does not
appear on the scene of human affairs solely in the role of a
member of one definitive group. In speaking of social groups
it must be remembered that the members of one group are at
the same time members of other groups. The conflict of groups
is not a conflict between neatly integrated herds of men. It is a
conflict between various concerns in the minds of individuals. "

[Juan · Rating 5 out of 5]

Lo leí allá por 2014 ó 2015 y fue una de mis lecturas preferidas aquel año. Lo releeré.

[Anderson Paz · Rating 3 out of 5]

Essa obra de Mises é fundamental na estrutura de seu pensamento. O autor estuda a ação humana como fundamento da ordem econômica e qual o papel da história na compreensão de fatos passados e presentes, alertando que esta disciplina não se presta a estabelecer uma causalidade com eventos futuros como propõe a corrente de pensamento socialista. Por outro lado, esse texto, justamente por ser o fundamento último do pensamento do autor, expõe suas premissas historicistas (evolução social), imanentistas (negação da metafísica e de juízos axiológicos últimos), e relativistas (determinação dos fatos em dado momento e contexto histórico), que são pressupostos questionáveis.

[Don Lim · Rating 5 out of 5]

Many economists and historians attempting to analyze and extract theories from numerical data believe themselves to be free of any theory, bias, or subjectivity. The aim of science, natural and social, is to make universal claims and observations of reality. There is, however, a difference in methodological approaches between natural and social sciences. For the natural science (e.g. biology, chemistry, physics, etc.), hypotheses are put forth, tested through observations, and reasoned through imperfect induction. If contradictory observations occur, rigorous revisions to previously accepted hypotheses occur. Through enough testing and general acceptance of the scientific community, these hypotheses are accepted as universal laws, applicable independent of time and space, in relation to the matter and events in question.

The social sciences, that is, sciences dealing with human action, thought, and emotion (e.g. sociology, economics, psychology, etc.) does not have same tools available to arrive at universal laws. The same stimuli for different individuals produces different reactions, and oftentimes, the same stimuli for the same individuals produces still different reactions. In this manner, observations and rigorous testing of hypotheses pertaining to humans cannot lead to the formulation of universal laws. In this respect, every observation is unique to that individual in a unique time in a unique context, which will never be repeated again. Yet, Mises contends, rightly, universal laws can still be deduced through a priori reasoning. Every human within their minds contains the same logical structure and understanding of the world around them. Though minds are fallible and certain individuals may be able to follow the line of reasoning further than others, it is through logical argumentation in which social universal laws are deduced.

No doubt the two paragraphs I have written above draws more criticism, and more importantly, curiosity as to how the arguments Mises brings forth can be defended. This book examine deeper these claims in a revealing manner, taking apart the concepts of historicism, polylogism, and scientism. Mises, through this book, places himself directly in the conversation between continental and analytical philosophy, methodological dualism and materialist monism, and other important epistemological debates.

[Eric · Rating 5 out of 5]

This is the type of book that anyone with an interest in philosophy should read. Unfortunately, it's likely that only people who are already familiar with Mises and his work on praxeology will ever come across it.

It's highly unfortunate that the state of modern thought is still as hostile to Mises' ideas as it was when this work was written (if not more so). But regardless of your political persuasion Mises has some important things to say about the nature of human action. This book does a great job of reiterating those ideas and focusing on how they affect the way mankind can analyze and use history to its advantage.

It does seem like Mises uses a good portion of this work as a stick to beat Marxism over the head with. That's probably because at the time this book was written, Marxist and socialist ideas were more accepted than they are currently. However, a lot of the same strains of thought which led to the acceptance of Marxism are still alive today. Thus, Mises' critiques of its historical analysis are still relevant.

With any luck, the ideas in this book will gain more popularity and lead to a future worth living in. Perhaps the most important thing to take away from this work is that such a future is not an eminent reality. That's what makes books like this (and keeping them in circulation) so important. Ideas beget the future state of mankind. So let's make sure good ones don't die.

[Markus · Rating 5 out of 5]

In this book Mises' debunks all bullshit determinism and fatalism in the modern theory of history - like Historicism or Marx pretty disturbing and almost religious historical materialism - while defending the methodological dualism in his lucid and rational way based on a clear logical structure.
Although this book doesn't deal directly with economics it's, in my opinion, nontheless one of Mises most enjoyable books simply for the vast amount of important topics Mises tackles and makes clear to the reader. I sure learned alot unexpected stuff reading this book.
A free version of the book as PDF and epub can be found on the Mises Institut website.

[Johhny Appleseed · Rating 5 out of 5]

The most important contribution by Mises to understanding why theory is essential to any address of historical inquiry. After Human Action, this is my favorite Mises book. I love his dry wit and humor and how extensively he delves into a destruction of all Karl Marx's ideas. The introduction by Murray Rothbard is also among the best summaries of the validity of Praxeology. Just great stuff!

[Geir · Rating 5 out of 5]

An eye opening book in a class of its own. It cuts through a lot of the nonsense we are told and which is accepted as "good" political theory and history. Mises is never disappointing.

[Jacob Aitken · Rating 3 out of 5]

While there is much good in this volume, I have some reservations (which I will list in my conclusion). Still, it is very lucid.

Values are subjective, but not relative.  Subject simply means “from the knowing subject.”  Thus Mises can write that “any scientific treatment of the problems of value judgements must take into full account the fact that these judgments are subjective and changing” (von Mises 24).

Mises holds to a utilitarian version of natural law.  By itself it isn’t that bad, but it is utilitarian to the extent that he knows he really can’t give a justification for it.  This is evident in his treatment of justice: “the ultimate yardstick of justice is conduciveness to the preservation of social cooperation….Social utility is the only standard of justice. It is the sole guide to legislation” (36).  Strong words, indeed.  

Mises’s section on determinism is misleading.  He is seeking the Christian doctrine of providence and the self-contained God who is the concrete universal, for he wants to deny pure randomness.  Mises wants to uphold determinism but reject materialism (52).

Dismantling Marx

Marx had said that “material, productive forces” is the agent of change in society.  However, as von Mises points out, he never told us what these are (73). How do you get technical knowledge from a material superstructure?  Mises lists three problems with this idea:

1) a technological invention is not merely material; it is the product of a mental process.
2) a mere designing of a technological invention is not sufficient to produce it.
3) the utilization of machines presupposes the social cooperation under the division of labor.

Is Wealth Really Concentrated in the hands of a few?

To a certain extent, maybe. But this ignores the most obvious fact about corporations: the bigger the corporation the more widely its stock shares are distributed (79).

Criticisms

He had an awful section on medieval Christianity.  He tried to engage in exegesis and was clearly out of his league (29-30). Further, this is probably a Mises volume that you could skip and not miss anything. If you are the type who is interested in Mises, then you will probably read *Human Action,* anyway. Or at least *Socialism.* You get the same destruction of Marxism there without the extra material where he fights forgotten early 20th century fellow humanists.

[Daniel Clemence · Rating 1 out of 5]

Before I begin to give you my views on Theory and History, I will admit to having a Left-leaning bias. This shapes how I view the book. This is important to note, as the high score this book has on reviews is likely a result of the type of people who are reading it. I.e., if a Christian theology book is only read by Christians, it is likely to be viewed positively. I suspect the prominence of 5-star reviews is likely caused by the number of Libertarians and Conservatives who read this book.

That said, I will get to the review. Theory and History is a grand theory book of philosophy that looks at human experience, epistemology of value, determinism, and the philosophy of history. The book views this from a particular classical liberal lens that emphasises the role of individuals in how they cooperate to create society. Unlike other individualists such as Ayn Rand, who only seem to look at how individuals are selfish, Ludwig Von Mises emphasises the importance of human cooperation in their achievements within society.

Part One is a focus on the values that humans hold. Theory and History emphasise how humans hold rather subjective values that differ from person to person. The criticism that Ludwig Von Mises has for socialists and other collectivists (the book talks a lot about collectivism) is that they tend to ignore the individual preferences that other people have. They also degrade people to be entirely made up of the movements that they are a part of. Subjective values are better in a free-market economy, and this in turn, is a better way of running the economy at large. Tariffs (sorry Trump), subsidies, and other protectionist policies undermine society at large. These are done at the benefit of one group at the expense of the nation at large. The society has a conflict in finding the absolute values within society to all to agree to. For Ludwig Von Mises, the most universal of all values and traits is social cooperation. Indeed, Ludwig Von Mises argues throughout the book that social cooperation is the basis of society and social interaction. Social cooperation allows society to grow in complexity and allows capitalism to develop. Via the use of social cooperation, Ludwig Von Mises seems to argue for some form of utilitarianism. Although Part One rejects grand ideas of absolute values.

Part Two is focused on the ideas of determinism and materialism. Within this section, Ludwig Von Mises argues against the notion of determinism, arguing that it is incompatible for understanding humans. He argues that humans have free will, unlike animals, because we can make choices and ideas. Ideas within Theory and History seem to be a central part of theory within the book, as ideas have the power to change history. Ludwig Von Mises attempts to argue against determinism and, in doing so, rejects the notions of determinism that Marxism and socialism have. In this view, the book tries to assert that humans having free will rejects the notion that people are materially determined by economic conditions. The book attempts to criticise materialist explanations of the world as they fail to take into account how individuals respond to ideas.

Part Three examines the philosophy of history and attempts to reject the notion that history has any source of predictability. Having argued against determinism, the book tries to assert that history does not have any predictable spirit and that individuals are the cause of action within history. To this end, Ludwig Von Mises argues a theory called “praxeology” in order to explain how humans interact within history and theorises that ideas shape history. These ideas ultimately allow people to act and be the agents of history. Part Four follows on from this idea and attempts to outline what holds in the future.

The book asserts the dominance of the individual over history. Rather than humans being shaped by their surroundings, Ludwig Von Mises argues that humans shape their surroundings. Individuals can have their mark in history. One of the positive aspects of this book is the emphasis on social cooperation. Unlike many on the political Right who argue for pure individualism, Ludwig Von Mises does see the potential of humanity through cooperation. Indeed, social cooperation has allowed humanity to achieve the things it has achieved. Another positive part of the book is the outright rejection of racism and nationalism. Given how conservatism and other right-wing ideologies are enthralled by nationalism at the moment, it is positive to see that conservatives have not always been so interested in racism. I think it is important to say that Ludwig Von Mises was a conservative liberal in that for him, conservatism is a small-state libertarianism and not some nationalistic idea that exists in the mind among many on the Right.

Despite these positives, it would be uncharacteristic of me not to have some criticism of a book I didn’t like. I did say I have a leftist bias. So, the way I see this book is deeply flawed. Let’s start with the basics as to why I disagree with this book. This book is poorly cited. There are citations and footnotes within the book, but much of the book contains massive generalisations and assumptions. Much of the book lacks citations for any claims made, and this is showing. For example, in Chapter 7 Section 8 “Critics of Marxism”, the book argues that Christians have been great criticises of capitalism. Ludwig Von Mises makes out that churches, for the most part, were hostile to capitalism and receptive to socialism and Communism. Despite such an extraordinary claim, he provides two citations for this, one from a Catholic historian and the other a Christian theology professor of Alexander Miller whom I have never heard of. Now I would have been impressed to find out how the church has been supportive of socialism. The reality is very mixed. One book on Christian history I read found large support for socialism among American clergy in the 1930s in the great depression, but given how wrapped up Christians have been with conservative and right-wing parties in the past 100 years, I find this claim to be rather laughable. Sure, there have been Leftist Christians (like myself), but to paint the whole of Christianity as a socialist religious sect is ridiculous.

Another claim with no evidence is from Chapter 8, where he argues that ideas are not the product of geographical environment. He argues that geographic determinism is a doctrine that “manifestly contradicts the data available”. Does Ludwig Von Mises provide any data? No. Instead, he asserts that ideas are developed by individuals through an evolution of ideas. Again, flatly ignoring the data or just asserting the data without providing is just a naked assertion. Of course, this is not the only time data is ignored, which goes on to my second criticism.

My second criticism is that Theory and History attempts to refute the philosophical idea of determinism, but lacks the evidence or theory to do so. Ludwig Von Mises attempts to argue that because human action is separate from animal behaviour, it must follow that humans have free will and animals don’t. Except that it does not follow that humans are separate entirely from animals and that they have free will. The fact that psychology regularly uses animals as a comparison to human behaviour shows that humans are not some special beings enthralled with free will. Unfortunately for Ludwig Von Mises, the studies from psychology, biology, sociology, and anthropology argue against the idea of pure free will. Unless you want to argue that human will is a product of sub-quantum level chaos, which allows for free will, it follows that determinism has considerably more data to defend. Of course, Ludwig Von Mises, as previously stated, doesn’t deal with data. He could have looked at philosophical papers and books on the issue, but rather spewed his own ideas that lack any defensible position.

The book seems to have an all-encompassing view of socialism. It was written in the height of the Cold War when socialism meant Communist aligned or sympathetic to its ideas. Regarding social cooperation being the heart of society and development. What I find paradoxical about this claim is that if social cooperation is so important to human development and human flourishing, why is it that countries with lower inequality have more social cooperation? This has been shown in books such as Bowling Alone and Spirit Level, that social cooperation is greater in countries with more economic equality. For a book that absolutely disparages socialism, I find it to be of the highest irony that Socialist policies practised by European countries actually increase social cooperation. Policies such as welfare, public education, public healthcare, strong unions, public services, and the like improve social cooperation within society. This always becomes the famous ghost of socialism in how Europe is a capitalist continent, until you are trying to criticise government programmes, which then magically transforms capitalist Europe into socialist Europe.

Another criticism is that the book flat-out ignores how imperialism and coercion shaped the development of capitalism. Whilst Ludwig Von Mises seems to think that capitalism developed from the benign origins of social cooperation, other books are far more critical. Books such as Empire of Cotton argue that the development of capitalism is directly the result of imperialism and slavery, whilst books such as The Making of the English Working Class argue that exploitation is at the heart of capitalism. Again, back to the problem of Ludwig Von Mises is that he asserts broad generalisations and fails to assert with evidence why capitalism is inherently based on social cooperation, when history contradicts this.

Theory and History seem to promote a philosophy of idealism as argued in Chapter 9, “Ideas live longer than walls and other material artefacts”. Ludwig Von Mises seems to argue that ideas almost float purely from individuals, but argues heavily against studying the distant past, as in Chapter 13, studying the Mithras cult or the kings of Egypt as “useless, a waste of time, money, and manpower”. Such intellectual arrogance can only be displayed by an intellectual who has no time understanding how ideas gain traction. Ideas gain prominence because of historical context and circumstance. Aristotle was a great philosopher because he came up with important theories and because he was the tutor of Alexander the Great. Ideas are products of theories developed by mankind as a whole, not just merely popped into the heads of great people. There is a reason why history has fallen out of favour with the Great Man theory of history.

Overall, this book lacks the evidence to back up its great claims. Many of the assertions can be dismissed by other research put forward. Its arrogance on some points made it an irritating book. The book Theory and History is the reason why academics these days avoid making massive claims outside their expertise. They end up being wrong.

[Fabricio Ter★n · Rating 5 out of 5]

Libro de epistemología de las ciencias sociales, sobretodo de la economía, la sociología y la historiografía. Amplio conocimiento de los sistemas de pensamiento abordados y gran capacidad analítica para entender sus virtudes y falencias. Profundidad pero con lenguaje claro. Debería ser más conocido, si pudiera retroceder el tiempo sería el primer libro sobre alguna ciencia social que leería.

[Keith Darrell · Rating 4 out of 5]

This is simply an outstanding book that needs to be read and studied.

Political Individualism is on the wane and Political Collectivism is on the rise - and it seems the same basic parameters are almost identical 60 years later. In light of that, there's a sense in which Mises' work is the antidote to current Political Collectivism. There is, however, another sense in which Mises' work is wholly inadequate to strike the root.

First, the book is a methodological consideration on human action, which Mises' takes to be of a different category than the natural sciences. So, if we approach human action like we do the laws of physics, then we are going to come to errant conclusions, because man is not an involuntary atom. Acting man is different than stones, planets, and atoms, because he has desires and goals. Individual man acts "rationally" and teleologically. This for Mises is axiomatic. In light of this axiom, Mises seeks to apply this understanding to history and how this methodology sets itself off from all forms of collectivism. Mises' critique of collectivism, especially Marx's dialectic, are devastating, but, unfortunately, offered from the wasteland of subjectivism. Mises says,

"Of course, the objections the economists advanced to the plans of the socialists and the interventionists carry no weight with those who do not approve of the ends which the peoples of Western civilization take for granted. Those who prefer penury and slavery to material well-being and all that can only develop where there is material well-being may deem all these objections irrelevant. But the economists have repeatedly emphasized that they deal with socialism and interventionism from the point of view of the generally accepted values of Western civilization. The socialists and interventionists not only have not-at least not openly-denied these values but have emphatically declared that the realization of their own program will achieve them much better than will capitalism."

So, consider Jesse Jackson at Stanford University in the 80's and chanting, "HEY! HEY! HO! HO! Western Culture's got to go!" Mises admits that ultimate ends are subjective, so while he might not like the ultimate ends that Jesse Jackson wants to pursue, he must admit that he has no argument against his ultimate goals.

So, yes, run out and read this book, but realize the error of Mises' subjectivism and develop a worldview that has liberty, political/economic individualism, and the like as an absolute value or fall prey to covering your mouth when your opponent disagrees.

[Vadim · Rating 4 out of 5]

Книга экономиста Людвига фон Мизеса "Теория и история" (см. русский перевод http://www.libertarium.ru/lib_evolution) посвящена методологии общественных наук и отстаивает тезис о том, что они нуждаются в другом методе, чем естественные науки, по крайней мере на нынешнем этапе развития. Для естественных наук -- объяснение через причинность, для общественных -- через обращение к разделяемым людьми идеям, их целям и убеждениям. "Действия людей определяют идеи, ... по крайней мере, при настоящем состоянии человеческой науки невозможно свести возникновение и трансформацию идей к физическим, химическим или биологическим факторам".

Книга Мизеса приятно удивляет даже при повторном ее прочтении не просто широкой эрудицией экономиста в сфере других гуманитарных дисциплин, а глубоким уважением к тому, что делают люди других занятий, в частности, историки и литераторы.

При этом, с его точки зрения, экономика требует встречного уважения. Если "историки воздерживаются от объяснения земных событий сверхъестественными причинами" и "избегают утверждений, которые очевидно противоречат данным естественных наук", в сфере экономики они нередко "придерживаются несостоятельных теорий", что обесценивает проделанную работу.

Современный российский читатель найдет в этой книге шестидесятилетней давности многие комментарии на события сегодняшнего дня: от противопоставления духовности материализму до обсуждения фальсификации истории.

[Bakunin · Rating 3 out of 5]

Although not one of Mises best works, it is worth reading. In it, Mises argues against various philosophies of history (such as historicism) and presents his own view: man acts and history is the result of such actions. These actions cannot be foreseen as no one is omniscient. Past events do not and cannot dictate the unfolding of future events because the summation of individual action is too complex.

[IMPERIVM · Rating 5 out of 5]

Extremely lucid exposition on philosophy of science, epistemology, and ethics.

[Jeff Northrup · Rating 5 out of 5]

This is my favorite of all Mises' books. I recommend starting with this one if you've never read any Mises before.

[BGS · Rating 4 out of 5]

Audiobook

[Garrick Andres · Rating 4 out of 5]

Magnificent philosophy, magnificent mind.

[Todd · Rating 5 out of 5]

Really a must-read for anyone concerned with not only economics, but also justice, politics, philosophy, or any right-ordering and conduct of society. The work shows Mises' seasoning, experience, and long engagement with the topics contained herein. He does use academic language in the work, making it less accessible to those unfamiliar with such vocabulary. As is typical in such works, his assault upon competing systems is an irresistible battering ram, but his own alternative construction is not beyond criticism itself. Oddly enough, in the case of this book's primary argument, the only real flaw in terms of internal logic is an unforced error and easily avoidable, making it all the more surprising that a man of Mises' caliber and experience with this topic would have chosen such an error.
Rather than sticking with classical Liberalism, Mises chose to embrace Liberalism's offshoot Utilitarianism as the proposed way forward for society. Utilitarianism proposes "the greatest good for the greatest number" without being able to measure good and thereby arrive at any accumulation of good equaling the greatest amount. Nor are Utilitarians agreed as to how that "greatest" should be calculated, assuming they could ever surmount the problem of measuring good in the first place (so far, none of them have). Do we take an average, a median, a sum total, or some other calculation of the unmeasurable good?
Given Mises own wrecking ball he employed against Socialism's inability to engage in economic measurement and therefore calculation and therefore planning, one would think he would be more sensitive to this particular and insoluble problem with Utilitarianism. Further, while Utilitarianism may be able to trace its parentage to Liberalism, and its founders initially adopted Liberal vocabulary, it obviously must violate the individual protections of Liberalism. Individuals are subordinate to society, the collective, in terms of the collective's "greatest good," no matter what that means in terms of sacrifices at the individual level.
Some versions of Utilitarianism try to establish certain negative rights never to be transgressed in the pursuit of the greatest good, but once these are extended to the full amount of protection offered under Liberalism, what is left of Utilitarianism but varying conflicting opinions as to what might be the best choices for individuals to make in terms of their possible contributions to collective good and no ability to enforce such prescriptions?
Although Mises' inexplicable dalliance with anti-Liberal Utilitarianism is a major and unnecessary flaw in an otherwise extraordinary work, it really is otherwise head-and-shoulders above most such works in terms of its clear thinking, precise articulation, and the value it adds to the subject. For me, Mises' top three works include Liberalism: The Classical Tradition, Human Action, and this work; I would recommend reading them in that order. Many others would recommend Socialism An Economic and Sociological Analysis by Mises, Ludwig Von ( Author ) ON Jan-01-1981, Paperback in place of Liberalism, though I personally found Socialism's arguments to be scattered, disjointed, and sometimes guilty of the same criticisms Mises levied against Marx. It is a valuable work, but I'd save it until having read other of Mises works, so at least you understand what he's saying when he fails to explain it on his own therein.
Theory and History is a must read, you will feel your brain cells growing while you read it, whether you find yourself agreeing or disagreeing with it as you go.

[Steven H · Rating 5 out of 5]

THE ‘AUSTRIAN’ ECONOMIST LOOKS AT HISTORY AND OTHER FACTORS

Economist Ludwig von Mises wrote in the Introduction to this 1957 book, “As soon as people venture to question and to examine an end, they no longer look upon it as an end but deal with it as a means to attain a still higher end. The ultimate end is beyond any rational examination. All other ends are but provisional. They turn into means as soon as they are weighed against other ends or means. Means are judged according to their ability appreciated according to their ability to produce definite effects. While judgments of value are personal, subjective, and final, judgments about means are essentially inferences drawn from factual propositions concerning the power of the means to produce a definite effect there can be dissension and dispute between men. For the evaluation of ultimate ends there is no interpersonal standard available. Choosing means is a technical problem, as it were, the term ‘technique’ being taken in its broadest sense. Choosing ultimate ends is a personal, subjective, individual affair. Choosing means is a matter of reason, choosing ultimate ends a matter of the soul and the will.” (Pg. 14-15)

In the first chapter, he asserts, “All judgments of value are personal and subjective. There are no judgments of value other than those asserting ‘I’ prefer, ‘I’ like better, ‘I’ wish… Value is not intrinsic. It is not in things and conditions but in the valuing subject. It is impossible to ascribe value to one thing or state of affairs only. Valuation invariably compares one thing or condition with another thing or condition.” (Pg. 22-23)

He observes, “The characteristic feature of a free society is that it can function in spirit of the fact that its members disagree in many judgments of value. In the market economy business serves not only the majority but also various minorities, provided they are not too small in respect of the economic goods which satisfying their special wishes would require. Philosophical treatises are published---though few people read them, and the masses prefer other books or none---if enough readers are foreseen to recover the costs.” (Pg. 61)

He explains, ‘the sciences of human action… reject… the positivistic and panphysicalistic distortion of determinism… ideas determine human action and … in the present state of human science it is impossible to reduce the emergence and the transformation of ideas to physical, chemical, or biological factors… The sciences of human action by no means reject determinism. The objective of history is to bring out in full relief the factors that were operative in producing a definite event. History is entirely guided by the category of cause of effect…” (Pg. 93)

He argues, “We may summarize the Marxian doctrine in this way:… material productive forces compel men to enter into definite production relations which are independent of their wills. These production relations father on determine society’s juridical and political superstructure as well as all religious, artistic, and philosophical ideas… The inherent weakness of this doctrine is that it deals with classes and not with individuals… Even Marx cannot help admitting that a conflict exists between the interests of an individual and those of the class to which he belongs.” (Pg. 112-113)

He states, ‘Capitalism is essentially mass production to fill the needs of the masses. But Marx always labored under the deceptive conception that the workers are toiling for the sole benefit of an upper class of idle parasites. He did not see that the workers themselves consume by far the greater part of all the consumers’ goods turned out. The millionaires consume an almost negligible part of what is called the national product… The evolution of big business is itself proof of the fact that the masses and not the nabobs are the main consumers.” (Pg. 118-119)

He argues, “the group concept is an ideal type and as such is derived from the historian’s understanding of the historical forces and events. Only individuals think and act. Each individual’s thinking and acting is influenced by his fellows’ thinking and acting… The individual American’s thoughts and conduct cannot be interpreted if one assigns him to a single group.” (Pg. 191)

He says, “Profit is the difference between the higher value of the good obtained and the lower value of the good obtained and the lower value of the good sacrificed for its obtainment. If the action, due to bungling, error, and unanticipated change in conditions… results in obtaining something to which the actor attached a lower value than to the price paid, the action generates a loss. Since action invariably aims to substitute a state of affairs which the actor considers as more satisfactory for a state which he considers less satisfactory, action always aims at profit and never at loss. This is valid not only for the actions of individuals in a market economy but no less for the actions of the economic director of a socialist society.” (Pg. 210)

He notes, ‘Technological innovation hurts the interests of workers who can no longer make a living by clinging to the discarded inferior methods. The vested short-run interests of small business and of inefficient workers are adversely affected by any improvement. This is not a new phenomenon. Neither is it a new phenomenon that those prejudiced by economic improvement ask for privileges that will protect them against the competition of the more efficient. The history of mankind is a long record of obstacles placed in the way of the more efficient for the benefit of the less efficient.” (Pg. 236)

He asserts, “It is hardly possible to mistake more thoroughly the meaning of history and the evolution of civilization than by concentrating one’s attention upon mass phenomena and neglecting individual men and their exploits. No mass phenomenon can be adequately treated without analyzing the ideas implied. And not new ideas spring from the mythical mind of the masses.” (Pg. 263)

He says, “The churches are right to lament the destitution of the masses in the economically backward countries. But they are badly mistaken when they assume that anything can wipe out the poverty of these wretched people but unconditional adoption of the system of profit-seeking big business, that is, mass production for the satisfaction of the needs of the many.” (Pg. 343-344)

In the final chapter, he states, “The key stone of Western civilization is the sphere of spontaneous action it secures to the individual.” (Pg. 374) He continues, “No innovation would ever have been accomplished if its originator had been in need of an authorization from those from whose doctrines and methods he wanted to deviate.” (Pg. 377)

He concludes, “Up to now in the West none of the apostles of stabilization of petrification has succeeded in wiping out the individual’s innate disposition to think and to apply to all problems the yardstick of reason. This alone, and no more, history and philosophy can assert in dealing with doctrines that claim to know exactly what the future has in store for mankind.” (Pg. 379)

This book may interest those studying Austrian economics, and economic history.

[Jon · Rating 3 out of 5]

If you’re looking for a sustained attack on socialism (while steering clear of nationalism) that focuses on the philosophy of history, this is definitely worth reading. The problem with Mises is how caught up he was in assumptions like “All people look with envy upon Western civilization” and gross tropes about non-Western, “backward” economies (e.g., his particular account of Asian economies is horrific). While, in some sense, he was trying to push against a particular form of racism (and nationalism), he drew upon particularly racist ideas to make his case. Still, I think his emphasis on human action is important for the discussion in historiography and sociology (and their relationship to economics), and realizing what he was fighting in the Soviet manifestation helps situate it a bit more. Just reader beware.

[Gregory · Rating 4 out of 5]

Ludwig Von Mises w znakomitym stylu tłumaczy istotę niezaprzeczalnej wyższości wolności gospodarczej nad innymi systemami organizacji gospodarki. Rozprawia się także z pseudofilizoficznymi nurtami. Tłumaczy gdzie leży istota wolności i w czym tkwi jej źródło. Szkoda, że obecnie nie ma tak genialnego umysłu, który byłby w stanie obnażać absurdy kierunków w które zmierza świat. Wolność jest niestety w odwrocie, a do głosu niemal wszędzie dochodzą większe lub mniejsze ideologie socjalistycznej nędzy i upodlenia. Czy ktoś jeszcze sięga po tego typu lektury i jest w stanie je objąć umysłem? Oby!

[Gerry · Rating 4 out of 5]

I was introduced to this text at a Mises University Summer School at Claremont McKenna in California. It's significance did not register until my interests turned away from economics qua economics to a broader study of complex systems. Not that this text provided me with insights into complex systems but did provide part of a window into a bigger and Broder view of the world.

[harcourt · Rating 4 out of 5]

Mises at his best. Like Menger's book on the social sciences but with greater depth, and with comparable clarity. Mises' distinguishing between the different objectives of sciences and their methods is vital. I recommend any aspiring social scientist (whether economist or historian) to read this.

[Наталія Толмачова · Rating 5 out of 5]

Одна з найважливіших книжок Мізеса. Варто прочитати всім, хто здобуває фундаментальну методологічну освіту.

[Marcelo Corghi · Rating 5 out of 5]

O último capítulo é genial, é quase profético. Mais uma vez, Mises foi correto em suas ideias sobre o futuro da liberdade. Excelente livro.

[Farhan Sinha · Rating 4 out of 5]

I started reading Human Action after getting through about half of this book, but I didn't really like his writing style in this book, it was confusing and hard to read