Praxeology is the study of human actions and is heavily used in the Austrian School of Economics, which believes that the economy is influenced by individual human choices. Ludwig von Mises believed that humans make intentional decisions for self-improvement and gratification. The action axiom is a basic tenet of praxeology, stating that all people behave purposefully as they interact with their surroundings. Praxeology is studied in the humanities and some still integrate aspects of it into a broader understanding of economics.
Praxeology, broadly speaking, is the study of the actions taken by human beings and, in an economic sense, refers to an approach to economics heavily dependent on the study of the actions of individuals. This view of economics was developed by Ludwig von Mises and the Austrian school. Human societies have pondered the role of action in the lives of humans for thousands of years, with a number of Greek philosophers exploring praxeology and Austrian School subscribers arguing that economics could be considered a subset of praxeology . These theorists believe that the economy is profoundly influenced by individual human choices.
According to Mises, one of the defining characteristics of being human is the ability to make choices and engage in intentional decision-making. This differentiates humans from other animals and also means that every human action has meaning and intent. In general, Mises believed that humans took actions with the goal of self-improvement and gratification, even if a somewhat circular approach was required.
In the Austrian School of Economics, human choices are believed to be the driving force behind the market, with groups of people organizing to create changes in market conditions. People involved in investments and other economic activities have personal satisfaction as a goal and engage in behaviors intended to achieve that goal. Observers attempting to study the role of human action also impact their surroundings, making it extremely difficult to study the economy under controlled conditions, much less produce replicable experiments.
Under the logic of the action axiom, one of the basic tenets of praxeology in economics, all people behave purposefully as they interact with their surroundings and adapt their behavior to meet changing conditions and needs. In economics, this can clearly be seen as investors shift investment strategies to take advantage of market changes. This approach to economics is not widely practiced today, although some people still believe it, or integrate aspects of it into a broader understanding of economics and the factors that play a role in economic activity.
A number of texts on the Austrian School and praxeology have been published and are available through publishers interested in economic studies. Sometimes these texts are examined in philosophy and economics lessons to learn more about the different theories on human behavior and its influence on the economy. Praxeology in general is studied in the humanities by students in a variety of fields interested in historical theories and their modern applications.
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