Glossary for Human Action, Chapters 3 - 7
Here's a glossary for some unfamiliar terms used in chapters three through seven of Human Action, by Ludwig von Mises. These definitions were written after consulting Webster's Third New International Dictionary, the Encyclopedia Britannica, and Mises Made Easier, by Percy L. Greaves Jr.

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anteriority & consequence: More simply, before and after. Used in logic to distinguish that which is logically prior, or anterior, from that which follows as a consequence. Used praxeologically in connection with causes and effects -- the cause is anterior to the effect, and the effect is the consequence of the cause.

antinomy: A paradox; a contradiction.

asceticism: Rigorous abstention from self-indulgence. The doctrine that through renunciation of the desires of the flesh and of pleasure in worldly things -- and through self-mortification or self-denial -- one can subdue his appetities and discipline himself to reach a higher spiritual or intellectual state.

autistic: Literally, self-directed. Note that von Mises' use of this word has nothing to do with the psychological disorder known as autism. An autistic exchange is one that one makes with oneself. The decision to trade hours of labor for hours of leisure is an instance of autistic exchange.

bet: A wager on a specific future event that cannot be characterized using the methods of class probability. Contrast with gamble.

bourgeois (French): A shopkeeper or businessman; a middle class person; one of the social class whose income derives from the profits of commercial and in-dustrial enterprise. One whose social behavior and political views are determined by private property interest; a capitalist.

case probability: Relative certainty or uncertainty concerning a unique future event which cannot be treated using the methods of class probability.

catallactics: The theory of exchange ratios and prices. It analyzes actions that are based on monetary calculation, tracing the formation of prices back to the point at which acting man makes a choice.

category: One of the most abstract and universal terms, concepts, or notions. In Kantian philosophy, one of the pure a priori forms of the understanding: quantity (unity, plurality, universality); quality (relation, negation, limitation); relation (substantiality, causality, reciprocity); and modality (possibility, actuality, necessity). In post-Kantian philosophy, any major fundamental conception or general class of concepts.

cause & effect: Two concepts embedded in the category of action. In praxeology the cause is whatever impels a man to act, and his action is the effect. Also, the cause is the means chosen, and the effect is the result of applying that means. In the mechanistic view of external reality the very notion of cause and effect becomes somewhat problematic; but the terminology is still used to describe the physical interrelationship between two events that are closely related.

"ce que j'appelle mon présent, c'est mon attitude vis-à-vis de l'avenir immédiat, c'est mon action imminente." (French, quoting Henri Bergson on the here and now): "That which I call my present is my outlook upon the immediate future; it is my imminent action."

chrematistic: Of or related to wealth, in so far as it can be reckoned in terms of money.

class probability: Probability in the classic or mathematical sense. Because it deals with events that are conceptually similar -- that can be grouped into sets, or classes -- class probability can be quantified. See case probability.

cockaigne: An imaginary land of extreme luxury and ease, where physical comforts and pleasures are always immediately at hand. Easy street.

combinatorial analysis: A branch of finite mathematics dealing with the number of ways a set of objects can be arranged, or rearranged. For example, an elementary combinatorial argument reveals that when two ordinary cubical dice are rolled there is one way to roll 2, two ways to roll 3, three ways to roll 4, four ways to roll 5, five ways to roll 6, six ways to roll 7, five ways to roll 8, four ways to roll 9, three ways to roll 10, two ways to roll 11, and one way to roll 12.

competition: The peaceful process of the market economy in which each participant seeks satisfaction of his own desires while simultaneously striving to excel in the production of something the other participants want. Competition tends to produce the greatest possible satisfaction of all consumers by assigning to each individual that function in which he can render to all his fellow men the most valuable of all the services he is able to perform.

consumers: Those who utilize economic goods for the satisfaction of wants; or, equivalently, those who employ means to achieve their ends. In a market economy, the consumers are sovereign.

cost: The value of the price paid. The value of that which is renounced in any act of exchange. The contemplation of a cost is always a judgment of value. The concept of cost is embedded in the category of action.

costs & proceeds: Another pair of complementary concepts embedded in the category of action. The cost incurred in any exchange is the value of the thing that is given up; the proceeds are the value of that which is received. See profit, and loss.

de mensura sortis: Literally, of different kinds of measurement. A Swiss mathematician, Daniel Bernoulli, in the 18th century advanced a theory attempting to quantify changes in a man's wealth, or "moral fortune." Briefly, his theory held that proportion is all that matters; that if one man already has twice as much gold as some other man, it will take twice as much additional gold to produce the same sense of satisfaction for the first man as for the second. This idea is similar to the law of decreasing marginal utility, but it is mistaken because it applies an objective yardstick to purely subjective sensations.

dialectic: In Greek philosophy, a method of argumentation which proceeded from an initial idea (thesis) and another idea (counter-thesis) to an improved idea (synthesis). Aristotle regarded dialectic as intermediate between logic and rhetoric. G.W.F. Hegel used this term to symbolize the struggle between some finite aspect of the human spirit (thesis) with a corresponding aspect of the infinite (antithesis), leading continually to a new synthesis, which may be regarded as the next step in man's continuing spiritual evolution, or nearer approach to God.

dialectical materialism: An ontological theory advanced by Karl Marx, Friedrich Engels, V.I. Lenin and other communists. Briefly, it holds that the Hegelian system of thesis / antithesis / synthesis is the driving force behind all human history, but that it is to be understood as a struggle of physical, and not spiritual, forces. To quote a more extreme example of this sort of "reasoning," Engels said that the kernel of corn is the thesis, the plant that grows is its antithesis, and the ear of corn that ripens is the synthesis.

disutility of labor: An economic principle stating that because man views labor only as a means to achieve some other end he has in mind, he will not labor more than he must to acquire the things he wants.

economic goods: Any physical objects that acting man employs as means that are in limited supply. Economic goods of the first order are ready for use by the final consumer. Economic goods of higher orders are consumed in the process of producing economic goods of the first order. The act of consumption renders an economic good useless. Ideas are not goods. They may be, and often are, useful. But ideas are not limited in supply. They can be reused.

economies of scale: Gains in productivity achieved by making a productive enterprise larger. These arise because some of the factors of production are only available in indivisible units that are quite large. For example, if a productive process uses coal delivered by rail, a plant that is too small to use an entire car load of coal in a reasonable amount of time can increase its efficiency by expanding until it uses coal by the car load. Commonly associated with the law of returns, which is not the same thing.

eugenics: The scientific control of breeding. A systematic effort to "improve" a strain of plants or animals by selective breeding. Specifically, when applied to homo sapiens, the Nazis' plan to produce a master race under Hitler.

exchange: Trading one thing for another. The concept of exchange is embedded in the category of action. Autistic exchange (trade with oneself) is inherent in every action. Interpersonal exchange is the basis of the market.

exculpate: To clear from alleged fault or guilt; to absolve.

ex definitione: By definition.

expatiate: To speak or to write at great length or in considerable detail. To elaborate; to enlarge.

first law of Gossen: A psychological principle first enunciated by Hermann Heinrich Gossen. Repeated experience of a sensual pleasure yields decreasing satisfaction, until finally a point of saturation or satiety is reached. Though similar, this principle is not the same thing as the law of decreasing marginal utility.

free goods: Physical objects that are useful to acting man and that are available in unlimited supply. The classical economists considered air and water to be free goods. Today, water is most often an economic good, and in some localities (e.g., Tokyo) even the air is becoming an economic good.

gamble: A wager on a specific future event that is essentially indistinguishable from all other members of the class of events to which the particular event has been assigned. Gambling is based on class probability. Contrast with bet.

Geist: Literally, mind or spirit. That which guides and directs the actions of an individual. In Hegelian philosophy proper, Geist is the indwelling presence of the Holy Spirit of Christianity which comes to recognize itself as the ground of all being through a dialectical struggle: the finite versus the infinite. After Hegel, this concept of Geist's dialectical struggle developed in many directions. Karl Marx began his career as an outspoken critic of Hegel's personal Geist; he and his followers spoke not of an indwelling presence, but of an overarching almost superhuman Geist, whose struggle with itself is manifest in the world of material things and whose will determines the inevitable course of human history. See dialectical materialism.

Geisteswissenschaft: Literally, mind-science, or spirit-science. Mises calls it "moral science" -- this term was introduced by John Stuart Mill. In modern English we usually speak of "social science" instead of "moral science."

goods: Physical objects of any description that are useful to acting man. Generally speaking, an object becomes a good when a man employs it as a means for the attainment of some end.

goods of the first order: Goods that are ready for consumption by the ultimate consumer. Also called consumer goods.

ideology: The assertions, theories, and aims that constitute a socio-political program. In Marxism, a false doctrine that serves the interests of the class that created it. "The bourgeoisie have used their damnable capitalist ideology to exploit the long-suffering proletariat." Mises carefully separates the concerns of religion and metaphysics from the purely social concerns of ideologies. Compare world view.

labor: Human action expended for a mediate -- and not an immediate -- purpose. Human activity that produces the goods or provides the services that consumers demand. Labor is not an ultimate end -- it is always a means to an end. See disutility of labor.

"la durée pure, dont l'écoulement est continu, et où l'on passe, par gradations insensibles, d'un état à l'autre: Continuité réellement vécue." (French, quoting Henri Bergson on time as perceived duration in the contemplative, or meditative, aspect): "Pure duration in which the flow is continuous, and one passes by imperceptible degrees from one state to the next; Continuity really experienced."

law of decreasing marginal utility: An economic principle logically derived from the category of action: the usefulness, or utility, of one additional unit of some good to a consumer is less than the usefulness of the units of that good already in his possession.

law of returns: Popularly known as the law of diminishing returns, this economic law states that in any process of production that requires two inputs a and b, both of which are economic goods, there is some optimum ratio of those inputs that maximizes output. This law is a consequence of the definition of an economic good and the fact that both inputs are necessary in the production process.

"Le moulin à bras vous donnera la société avec le souzerain; le moulin à vapeur, la société avec le capitaliste industriel." (French, quoting Karl Marx on the industrial revolution): "The handmill gives you society with the feudal lord; the steam-mill, society with the industrial capitalist."

loss: The excess of cost over proceeds. In autistic exchange a loss is always the internalized result of a value judgment. In acts of indirect exchange on the market, loss is reckoned in terms of money.

materialism: Ontologically, a form of monism which holds that all of reality is composed of some sort of material substance; physicalism, as opposed to mentalism, or spiritualism. Ethically, a form of hedonism which holds that the enjoyment of physical things, and material well-being, are the ultimate ends of human existence. "Eat, drink, and be merry, for tomorrow we die."

mandrake: An herb (Mandragora officinarum) of southern Europe and northern Europe that bears yellow fruits which were formerly supposed to have aphrodisiac powers, and whose large forked root has been the subject of superstition.

marginal utility: That utility, or value, which acting man attaches to the last unit of any economic good at his disposal. Utility, or value, is always subjective. Though acting man sorts and grades the means at his disposal, his internal scale of values is not a numerical scale susceptible to precise measurement and arithmetic manipulation.

means & ends: Two concepts that are embedded in the category of action. An end is anything that acting man seeks to obtain.Means are anything employed by acting man in pursuit of his ends.

Physiocrats: A group of very early (mid 18th century) French economists. They regarded agriculture and mining as the only truly productive forms of economic activity, and their teachings influenced Adam Smith, who traveled to France in 1764. Their motto --laissez faire, laissez passer (leave it alone, let it pass) -- has come to symbolize non-interventionist governmental policies.

perorate: To speak grandiloquently; to elaborate.

polylogism: Literally, many logics. The theory that the logical structure of the human mind differs according to certain divisions of mankind, and that as a result the ideas and logic of men also differ in accordance with the specified classification. Marxian polylogism asserts that there are differences according to social classes (e.g., bourgeois logic vs proletarian logic). Other varieties of polylogism assert differences according to race, nationality, religion, etc.

positivism: A doctrine that originated with August Comte, and holding that all man's knowledge passes through three stages (theological, metaphysical, and positive). Contemporary positivism seeks to apply the experimental method of the natural sciences to the sciences of human action. The maxim of positivists is that science is measurement.

price: That which is renounced in an act of exchange. We must carefully distinguish between a price (the thing renounced) and a cost (the value of the thing renounced).

producers: Men who act to provide goods or services for consumption. Every producer is also a consumer.

profit: The excess of proceeds over costs. In its primary sense, profit is subjective, for it arises only within the mind of acting man. Secondarily, a profit may be considered to be a definite quantity of money when it arises in a market that is characterized by acts of indirect exchange.

proletariat: The lowest social or economic class in a community. In Marxism, the class of wage earners who lack their own means of production and who must sell their labor to live.

ratiocination: The process of exact thinking. Deductive reasoning, or a train of logically interrelated thoughts.

rationalization: The provision of plausible reasons to explain, to oneself or to others, behavior for which one's real motives are different, and unknown, or intentionally hidden, or unconscious.

sooner & later: Two concepts embedded in the category of action. In every act, the choice of an end and the selection of the means best suited to attainment of that end must occur sooner than the final action itself. See also anteriority & consequence.

sybaritism: The theory that happiness consists in indulging one's sensual desires for rare and luxurious pleasures. From Sybaris, an ancient Greek city in southern Italy notorious for the voluptuous lifestyle of its inhabitants.

tertium comparationis: Literally, a third [thing] for comparison. Figuratively, a basis for comparison.

time: That which passes as the future becomes the past.

utility: The importance that acting man attaches to his means. See value.

utopia: An utterly impractical plan or scheme for an idyllic human existence which is unattainable because of the inherent character of man. [The word was invented (from Greek) by Sir Thomas More, whose book by this title was first published in 1516.]

value: The importance that acting man attaches to his ends. Means acquire value -- or, more strictly speaking, utility -- as man considers how they might be employed to attain the end he seeks. Value is not intrinsic. It is not in things. It is within the human mind. It reflects man's reaction to his environment. Value is reflected in human conduct. It is not what men say about value that matters -- it is how they act. Value is always relative, subjective, and human. It is never absolute, objective, or divine.

Weber-Fechner law: A psycho-physical principle which states that the least increment in a physical stimulus that a human subject can notice is proportional to the force of the stimulus already being applied. For example, the commonly used decibel scale of sound intensity (based on the logarithm of the energy of the sound waves) utilizes this principle.