Methodological Individualism

110 Austrian methodological individualismthis topic. Methodological individualism now appears as an implication of praxeology,the science of human action.Praxeology deals with the actions of individual men. It is only in the furthercourse of its inquiries that cognition of human cooperation is attained andsocial action is treated as a special case of the more universal category ofhuman action as such.(Mises [1949] 1966: 41)As in Socialism, Mises argues that economics starts with the isolated individualand also that action is exchange. He now makes a distinction, however, betweenautistic exchange and interpersonal exchange ([1949] 1966: 97f). 28 Once again,‘Society is concerted action, cooperation’. As such, it ‘is the outcome ofconscious and purposeful behavior’ (p. 143). More surprising, Mises alsoendorses the following statement, if reluctantly: ‘Individual man is born into asocially organized environment. In this sense alone we may accept the saying thatsociety is – logically and historically – antecedent to the individual’ (p. 143). Thisis a statement typically made by collectivists against individualism. The presumptionis, of course, that the way society is organised to some extent determines thebehaviour of individuals. This is how Schumpeter saw the matter and the reasonhe was a methodological collectivist (universalist) in sociology (see p. 366, note26). But how does Mises avoid this conclusion. By shifting from methodology toontology. ‘[S]ociety is nothing but the combination of individuals for cooperativeeffort. It exists nowhere else than in the actions of individuals’ (p. 142).As in Epistemological Problems of Economics, Mises introduces the topic ofmethodological individualism by discussing its relation to the issue of nominalismversus realism, but now with a more uncertain relation betweenmethodological individualism and nominalism.No less inappropriate with regard to our problem is the reference to theantagonism of realism and nominalism, both these terms being understoodin the meaning which medieval scholasticism attached to them. It is uncontestedthat in the sphere of human action social entities have real existence.Nobody ventures to deny that nations, states, municipalities, parties, religiouscommunities, are real factors determining the course of human events.Methodological individualism, far from contesting the significance of suchcollective wholes, considers it as one of its main tasks to describe and toanalyze their becoming and disappearing, their changing structures, andtheir operation.(Mises [1949] 1966: 42)Mises now seems to suggest that the problem of individualism versus collectivismhas nothing to do with that of nominalism versus realism, but later on in thesame work he once again lumps them together and declares that the doctrines ofcollectivism, conceptual realism, universalism and holism are the arch-enemies