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Epistemological Problems of Economics
Ludwig von Mises

4
On the Development of the Subjective Theory of Value

3. Eudaemonism and the Theory of Value

The most troublesome misunderstandings with which the history of philosophical thought has been plagued concern the terms "pleasure" and "pain." These misconceptions have been carried over into the literature of sociology and economics and have caused harm there too.

Before the introduction of this pair of concepts, ethics was a doctrine of what ought to be. It sought to establish the goals that man should adopt. The realization that man seeks satisfaction by acts both of commission and of omission opened the only path that can lead to a science of human action. If Epicurus sees in the final goal of action, we can behold in it, if we wish, the state of complete satisfaction and freedom from desire at which human action aims without ever being able to attain it. Crude materialistic thinking seeks to circumscribe it in visions of Paradise and Cockaigne. Whether this construction may, in fact, be placed on Epicurus' words remains, of course, uncertain, in view of the paucity of what has been handed down of his writings.

Doubtless it did not happen altogether without the fault of Epicurus and his school that the concepts of pleasure and pain were taken in the narrowest and coarsely materialistic sense when one wanted to misconstrue the ideas of hedonism and eudaemonism. And they were not only misconstrued; they were deliberately misrepresented, caricatured, derided, and ridiculed. Not until the seventeenth century did appreciation of the teachings of Epicurus again begin to be shown. On the foundations provided by it arose modern utilitarianism, which for its part soon had to contend anew with the same misrepresentations on the part of its opponents that had confronted its ancient forerunner. Hedonism, eudaemonism, and utilitarianism were condemned and outlawed, and whoever did not wish to run the risk of making the whole world his enemy had to be scrupulously intent upon avoiding the suspicion that he inclined toward these heretical doctrines. This must be kept in mind if one wants to understand why many economists went to great pains to deny the connection between their teachings and those of utilitarianism.

Even Böhm-Bawerk thought that he had to defend himself against the reproach of hedonism. The heart of this defense consists in his statement that he had expressly called attention already in the first exposition of his theory of value to his use of the word "well-being" in its broadest sense, in which it "embraces not only the self-centered interests of a Subject, but everything that seems to him worth aiming at."[2] Böhm-Bawerk did not see that in saying this he was adopting the same purely formal view of the character of the basic eudaemonistic concepts of pleasure and pain—treating them as indifferent to content—that all advanced utilitarians have held. One need only compare with the words quoted from Böhm-Bawerk the following dictum of Jacobi:

We originally want or desire an object not because it is agreeable or good, but we call it agreeable or good because we want or desire it; and we do this because our sensuous or supersensuous nature so requires. There is, thus, no basis for recognizing what is good and worth wishing for outside of the faculty of desiring—i.e., the original desire and the wish themselves.[3]

We need not go further into the fact that every ethic, no matter how strict an opponent of eudaemonism it may at first appear to be, must somehow clandestinely smuggle the idea of happiness into its system. As Böhm-Bawerk has shown, the case is no different with "ethical" economics.[4] That the concepts of pleasure and pain contain no reference to the content of what is aimed at, ought, indeed, scarcely to be still open to misunderstanding.

Once this fact is established, the ground is removed from all the objections advanced by "ethical" economics and related schools. There may be men who aim at different ends from those of the men we know, but as long as there are men—that is, as long as they do not merely graze like animals or vegetate like plants, but act because they seek to attain goals—they will necessarily always be subject to the logic of action, the investigation of which is the task of our science. In this sense that science is universally human, and not limited by nationality, bound to a particular time, or contingent upon any social class. In this sense too it is logically prior to all historical and descriptive research.

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[2] Cf. Böhm-Bawerk, Kapital und Kapitalzins, Part II, Vol. 1, p. 236, footnote.

[3] According to Fr. A. Schmid, quoted by Jodl, Geschichte der Ethik (2nd ed.), II, 661.

[4] Cf. Böhm-Bawerk's comments on Schmoller, op. cit., p. 239, footnote; on Vierkandt, cf. above p. 55.

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