The Synthetic A Priori and What It Means for Economics

Note: This article was published on the previous domain and it no longer exists. On a chance, I happened to find it preserved perfectly as a saved file on my computer, so I am here reprinting it as I originally wrote it.

A good reply by Daniel Kuehn is here.

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Immanuel Kant, one of the Enlightenments great philosophers, created perhaps a larger paradigm in the course of philosophy than he himself realized. While famous for his Categorical Imperative, Kants true claim to fame was his discovery into the nature of knowledge and reality. Kant divided claims about the universe into 2 categories analytic and synthetic claims. And he divided ways of knowing them into 2 categories a priori and a posteriori knowledge.

Analytic claims are those claims that are true by definition, but do not necessarily have relation to the real world. These claims are tautologies, in that the truth of the claim is evident in its subject predicate. Analytic claims might be:

All triangles on a plane surface have 180 degrees; Bachelors are unmarried men. Synthetic claims are claims that deal specifically with the real world. Synthetic claims might be:

Blood type O is the universal donor; Muscles burn carbohydrates before burning calories. A priori knowledge is knowledge that comes from understanding, or deductive logic, without reference to experience. A priori knowledge consists of:

2 + 2 = 4; A =/= B.

A posteriori knowledge is knowledge that comes from either empirical studies done by scientists, or common sense observation. A posteriori knowledge consists of:

Trees grow from seeds; Water is composed of H2O. Thus, there are 4 possible ways to know about the universe.

Take A for example. Analytic a posteriori claims are claims that are tautologically true, but can only be understood through empiricism. Walter Block has an excellent example of such a truth.

Although there is some question about this in philosophical circles, one way to characterize the elements in this set is in terms of the ways in which we come to learn language. For example, We shall use language in such a way that rouge in French will translate to red in English. We learn this through experience, but to say Rouge equals red is an analytic statement. For A, the analytic a posteriori, we can learn each of the words in this sentence through experience (in an a posteriori manner), and yet the meaning of it is tautological.[1] Next is B. Analytic a priori claims are those that are apodictically true, and we can learn by logic alone. Mathematics and geometry are made exclusively by analytic a priori claims. They concern abstract logical rules such as the operations of calculus and trigonometry.

Likewise, C easy to understand. The synthetic a posteriori statements are those that appeal to physical reality, but can only be understood by observation. The fact that I am an author of Economic Thought is a synthetic a posteriori claim, much like the truth that more people live in the United States than in Bhutan. The only way to come across this knowledge of the universe is to judge empirically whether it is true; no resort to deductive logic could answer who lives where.

Finally, we come to D the most important claim of truth for this discussion. The synthetic a priori statements are those that deal specifically with the real world, but can only be understood through reason alone. The synthetic a priori is fundamental for epistemology (ie, what can we logically know about reality?). It is thus fundamental for our understanding of economics. Synthetic a priori statements are also known as self-evident truths; they are referred to as such because any denial of their truth would entail a self-contradiction. These statements cannot be refuted by resort to experience.

Hoppe writes: According to Kant, mathematics and geometry provide examples of true a priori synthetic propositions. Yet he also thinks that a proposition such as the general principle of causality (i.e., the statement that there are time-invariantly operating causes, and every event is embedded into a network of such causes) is a true synthetic a priori proposition.

Valid synthetic a priori claims are objectively true, for any denial would entail logical contradiction. For instance, the statement Man acts is another synthetic a priori truth, because if anyone were to deny that man acts, he would be acting in order to deny my statement thus proving its truth.

The most comprehensive treatment of economic phenomena on the basis of synthetic a priori truth is Human Action by Ludwig von Mises. Using only minor auxiliary empirical assumptions (such as we live in a world of scarcity, and labor involves disutility), Mises takes human action as the only axiom by which he builds his structure. Using the action axiom, Mises makes corollary truths by means of logical deduction. He deduces that when man chooses, he is making a preference. A choice of A over B is in fact a preference of A over B. It also necessarily implies that A is chosen, and B is left aside. Choice implies preference and leaving aside. Soon, Mises builds the concept of opportunity cost from these previous axiomatic deductions. His other synthetic a priori deductions included Man prefers happiness to suffering and Man prefers sooner rather than later. These basic deductions into human nature allowed Mises to construct his model of human society from primitive, autarkic man to a collective society built on an extensive division of labor. All his conclusions arrive from logical deductive processes, and are therefore logically sound. Empirical evidence is useless to challenge these views, they must be argued via reason if one finds them faulty.[2]

The theoretical contributions of Human Action derive from the initial axiom. Mises understanding on monetary policy, competition, capital theory, and theories on interest all initially derive from synthetic a priori truths about man. While it is possible that Mises made an incorrect deductive jump, the rebuttal of such must be by aid of reason alone.[3] Using such self-evident truths, Mises continued the application into the study of man, a logical science called praxeology. Praxeology follows the same chain of logical deductions as mathematics and geometry, and therefore any contention with praxeology must be by resort to logic. Friedman is mistaken when he criticizes praxeologists for being difficult to reconcile.

If you and I are both praxeologists, and we disagree about whether some proposition or statement is correct, how do we resolve that disagreement? We can yell, we can argue, we can try to find a logical flaw in one anothers thing, but in the end we have no way to resolve it except by fighting, by saying youre wrong and Im right.[4] This mindset is typical of many economists used to modeling abstractions based on real-world experience on a posteriori grounds. Roderick Long, in a piece titled Realism and Abstraction in

Economics: Aristotle and Mises versus Friedman, corrects this faulty analysis of those who study economics from observation. He assuages their concern for logic thusly:

Lets take a less controversial case of an a priori discipline: mathematics. If two mathematicians disagree about the results of a calculation, they dont come to blows; nor do they consult a private source of revelation. Instead they try to find a logical flaw in one anothers thing, and presumably one of them will succeed because logical relations are at least as public as empirical ones.[5] Conclusions derived from the synthetic a priori are as contestable as conclusions derived from the analytic a priori if there is a discrepancy between scientists, the proper course of action is to trace the logical deductions to the root and attempt to clarify the logic underneath the challenged conclusion.

The synthetic a priori direction is extremely useful. Other models and hypotheses based on physical observation lack in accuracy, clarity, and/or reason. Because the changing dynamic economy has so many variables, the process of isolating variables (as in a laboratory) is impossible. The application of the scientific method of creating hypotheses, testing them, and reworking hypotheses is ultimately pointless. With the infinite complexity of variables all acting in unison, any attempt to work a model of reality by observing economic actors is to <i>over-simplify</i> and make <i>purposefully unrealistic</i>[6] claims about the world.

Only by proceeding step-by-step from axioms that are objectively true can we arrive at any meaningful understanding of the world. Only by using synthetic a priori knowledge can we make models that are complex enough to satisfy being realistic, and yet do not suffer from the shortcomings of empirical observation. Von Mises work on praxeology must remain the building block on which further understandings of complex economic phenomena rest. Any attempt to model economic behavior without the initial axiom and instead fall into conclusions characterized by instinctual or behavioral explanations will be faulty. Economics must rest on an edifice of logic.

[1] Block, Walter. Realism: Austrian Vs. Neoclassical Economics, Reply to Caplan. (The Quarterly Journal of Austrian Economics. Fall 2003.) http://mises.org/journals/qjae/pdf/qjae6_3_4.pdf

[2] Von Mises, Ludwig. Human Action. (Yale University Press. 1949)http://mises.org/resources/3250

[3] Kuehn, Daniel. You mention nothing in your post about the possibility that Mises took an invalid deductive step. http://www.economicthought.net/2010/05/thoughts-on-empiricism-andlogic/

[4] Friedman, Milton. Friedrich Hayek: A Biography (New York: Palgrave, 2001), p.273.

[5] Long, Roderick. Realism and Abstraction in Economics: Aristotle and Mises versus Friedman (The Ludwig von Mises Institute. 2004) http://mises.org/pdf//asc/2004/long.pdf

[6] Long, Roderick.