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Thread: Need clarification on this Rothbard passage about Praxeology

  1. #1
    Member Pennsylvania's Avatar
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    Default Need clarification on this Rothbard passage about Praxeology

    from Praxeology: The Methodology of Austrian Economics

    The fact that people act necessarily implies that the means
    employed are scarce in relation to the desired ends; for, if all means were
    not scarce but superabundant, the ends would already have been attained,
    and there would be no need for action.
    The above passage makes sense to me, but the passage that follows it has me confused:

    Stated another way, resources that
    are superabundant no longer function as means, because they are no
    longer objects of action. Thus, air is indispensable to life and hence to
    the attainment of goals; however, air being superabundant is not an
    object of action and therefore cannot be considered a means, but rather
    what Mises called a "general condition of human welfare."
    This seems to take a completely different course of reasoning if I'm understanding it correctly.

    Let's take the example of filling up a balloon with air. Going along with the first passage, there is already a superabundance of balloons filled with air, therefore there is no need to fill up any currently deflated balloons with air. But the second passage does not assume a superabundance of ALL means, but claims to apply to any SINGLE means. So let's assume we have a superabundance of both air and deflated balloons, but we want an inflated balloon, of which there is a limited supply. This passage appears to be claiming that neither the superabundant air, nor the superabundant deflated balloons count as means in achieving the end of having an inflated balloon. How is it possible not to consider the air and the balloon means in this case?

    The statement that resources that are superabundant no longer function as means appears to be false.
    Last edited by Pennsylvania; 03-05-2012 at 10:57 AM.


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  3. #2

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    It means classical economic theory only applies to scarce resources.


    Following your thinking (which is not really relevant to the point)... if neither air nor balloons were scarce, then any market for inflated balloons would be based purely on the work and energy needed to inflate the balloon. You would be paying labor costs, not material costs.

  4. #3
    Member Pennsylvania's Avatar
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    It is relevant because the balloon and air example also applies to the Crusoe situation. Even if there were no market demand for inflated balloons, air and deflated balloons are still means in the production of inflated ones.

  5. #4

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    The problem isn't market demand, it's supply. With an infinite supply, things like price and utility break down and may or may no be zero. People also tend to act irrationally towards free things, so that can add additional complexity.

    Nearly every resource is scarce, so it's not a common issue.

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