The Domain of Subjective Economics:

Between Predictive Science and Moral Philosophy


  • James M. Buchanan



Economy, subjectivism, forecasting, praxeology, choices


The author explains that the discussion on the methodology of the subjective economy needs to consider a fact and a hypothesis. The fact is that in any science of human behavior, the observer is himself amidst the observed and the hypothesis is that human beings choose. Notes that the two interpretations of the basic analysis of Smith differ in their explananda. The first attempts to explain the relative exchange values of goods and the second the institutions of exchange itself. The first is an objective theory and the second a subjective theory. The central point is that the author positive and predictive economics is an exercise of grinding what is obvious and a subjective economy can offer an analysis of the dynamics in which a society of free people choosing with a genuine sense develops and thrives. Also suggests that the focus of neoclassical economics compared to classical, is changed from empirical estimates for analysis of structures. However, he criticizes Mises by hung too much into the realm of the subjective economy.


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How to Cite

Buchanan JM. The Domain of Subjective Economics:: Between Predictive Science and Moral Philosophy. MisesJournal [Internet]. 2014 Jun. 1 [cited 2024 Jul. 17];2(1):69-7. Available from:



Economics, Methodology and Praxiology