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1. Austrian Sociology, Lecture 1
Human Action by Ludwig von Mises
Chapter VIII, pp.143-153
David Gordon
Mises Academy
March 19, 2013

2. Origin of Society
• Mises is a social rationalist. He thinks that
society arises from rational action among
human beings.
• He doesn’t mean by this that a group of
people get together and say, “let’s form a
society”.
• Rather, people recognize the benefits of
cooperation.

3. Cooperation
• People recognize that instead of fighting with
each other, they can benefit by peaceful
exchange.
• If people exchange goods and services instead
of trying to produce everything by themselves,
they benefit from the division of labor.
• The benefits of the division of labor and
peaceful exchange don’t have fixed limits.
They can be extended indefinitely.

4. The Nature of Society
• Society isn’t an independent entity that exists
apart from the individuals in it. If we say that
society or the nation acts, this just means that
particular persons act.
• Mises calls this view methodological
individualism.

5. Sympathy
• One theory of the origin of society is that human
beings sympathize with each other. This draws
them together into society.
• Mises doesn’t accept this theory. He says that
human sympathy is the outcome, not the cause,
of society.
• Once people see the benefits of cooperation and
exchange, the will tend to sympathize with those
who cooperate with them. But rational pursuit of
self-interest comes first.

6. Consciousness of Kind
• A related explanation of the origin of society is
that human beings have a “consciousness of
kind.”
• This phrase comes from the Columbia University
sociologist Franklin Giddings. Mises may have
heard of it through his student Eric Voegelin,
who was impressed by Giddings.
• Mises accepts this only if the phrase is taken to
mean recognition of the benefits of social
cooperation.

7. An Objection
• Mises says that society results from the
actions of individuals. But aren’t individuals
born into previously existing society?
• Mises admits this, be he says this doesn’t
show that society exists apart from persons.
Rather, individuals are socialized by persons
who are already alive when they are born.

8. A Fundamental Division
• One of Mises’s most important contributions
in Part II of HA is a division he establishes
between theories of society.
• The division is between theories that view
society as nothing but individuals and their
relations and theories that view society as an
independent entity that exists apart from
individuals.

9. Division Continued
• Mises’s contribution is what he says about the
theories that claim society exists independently
of individuals.
• Mises thinks that if you say this, then there is a
fundamental conflict between what individuals
want to do and the requirements of society.
• People have to be forced to follow social dictates.
They don’t follow social rules because it is in their
interest to do so.

10. Theology of Society
• If people have to be forced to do what society
requires, the questions come up: Who is going
to force them? How do these people know
what society requires?
• Mises thinks that these questions can only be
answered by postulating a superhuman or
divine origin of society. A priestly caste has
privileged access to God’s requirements.

11. Theology Continued
• Mises rejects this approach as unscientific. A
scientific theory must appeal only to human
reason.
• Mises has a very broad view of which theories
count as divine origin accounts. He considers
Marxism to be one such account, because it
assumes that the forces of production develop
independently of human decisions.

12. The Enlightenment
Mises interprets the Enlightenment as a battle
for the rationalistic view of society against the
divine origin theory.
He doesn’t think that all of the supporters of the
rational or individualist view were atheists.
Adam Smith and Bastiat believed in God, but
they maintained the individualistic view of
society.

13. Ethics
• Mises extends his division between
individualistic, self-interested theories of social
origins and theological theories to ethics.
• Ethical theories can be divided into those based
on individual self-interest and those based on the
demands of some non-human source. Mises calls
these theories heteronomous. This is different
from Kant’s use of that term.

14. Self- Interest theories of Morality
• The view that Mises supports claims that morality
is in everybody’s long-term self-interest. E.g., it’s
better for everybody if we live in a society where
physical aggression is prohibited.
• This doesn’t imply that individuals will always act
morally. People don’t always do what is in there
long run interest and coercion is sometimes
needed to enforce moral obligations.

15. Anarchism
• Mises thinks that anarchists ignore this point.
They think that people will cooperate without
any enforcement mechanism to get them not
to aggress and to keep agreements.
• Mises wasn’t thinking of libertarian anarchists,
who want competing protection agencies. He
had in mind people like Prince Kropotkin who
take a very rosy view of human nature.

16. Democracy
• Mises has an unusual argument for political
democracy.
• All government rests on popular consent.
There is no such thing as a long term
unpopular government.
• If a government no longer suits the people, it
will be overthrown.
• Democracy makes peaceful change of
government possible.