Monday, January 10, 2011

Why Austrian Economics and Literature?

Marxism has been used for a long time in literary studies, to discuss the representation of economics in works of literature and to discuss the methods and social structures of artistic/literary production. They have raised questions about how different classes have been represented in literature. These are interesting questions, even if one may be able to find better answers than the Marxists have come up with. For about a century now, Marxism has been the only economics used to analyze literature. I don’t think it’s a good way to analyze social reality, whether it be actual or represented in art — which is not to say that insights haven’t nevertheless been made because of Marxist analyses. I similarly don’t think that a Keynesian approach would tell us much, either — but, again, such an approach would no doubt uncover something of interest (and would be an improvement over Marxism in any case).For these reasons, it seems an Austrian economic approach would be beneficial. But there are more reasons than that.

It seems to me that if human action is represented in stories, then praxeology is a valuable tool to help understand that action. If economic interactions are represented in stories, then bringing an understanding of how the economy works is going to help us to understand what is going on in the story. And if we want to understand artistic and literary production, then we need a good theory of social organization, such as Hayek’s spontaneous order theory. I think Austrian economics is one of the best ways of interpreting social reality — which is why I am interested in further developing it to help interpret literary representations of that reality as well.

Overall, I am in favor of any interpretive strategy that helps us to understand the creation of and meanings of literature. I think that some strategies are better than others, and I think that some have outlived their usefulness (for currently existing literature — old methods can still be productively used for new works, of course). Austrian economics is a potentially fruitful approach, as I hope my comments to date have suggested. This approach should open up new ideas, and move us beyond Marxist analysis, much as evolutionary approaches have begun to move us beyond postmodernist/poststructuralist ideas in literary theory. (Dare I dream of a neuro-Hayekian/evolutionary psychology convergence?)


  1. I agree wholeheartedly with your statements. When I took a course in literature and culture in college, all I heard about was Marx and post modernism.

    I like the praxeological method in analyzing stories because of its methodological individualism primarily (not so much for its theories on spontaneous order, but ever since Cantor mentioned it in his book, I began to notice those moments of seeming spontaneity in stories I read).

    I think understanding how actors behave in the real world has given me new depth in to understanding why I like some stories and why I don't like others.

    :D great blog btw

  2. Thanks. I'm glad you've been enjoying it.

    I think spontaneous order theory tells us more about artistic production than anything, though understanding society as a spontaneous order can help us to understand and critique the way societies are represented in works of literature. It's one of those things open for investigation, to be sure.

  3. I'm all for different approaches to literature interpretation, but I don't understand how there can even be a "praxeological method." The praxeological understanding of human action is founded on axioms and the rejection of empirical testing, grounded on the assumption that what we observe is too complex to analyze. If we can't analyze human behavior in the real world, how can we do so in literature, whether fiction or non-fiction?

  4. Yes, it is true that praxeology is founded on axioms, but it is not true that empiricism is entirely rejected. Nor that what we observe is too complex to analyze. Mises points out that what we have to do is try to isolate out elements of a complex process to try to understand it's causal features, but then not forget to try to put it all together again. One then has to take into consideration complex feedback, network effects, etc. For Mises, humans act to try to go from a state of less to more satisfaction. If that's not what literature is about, I'm not sure what it's about. :-)

    Fiction has the advantage of being analyzable in the same way as a historical occurrence. One has to have the right theory of human action to have a right understanding of the actions of historical human beings -- or of characters. As Aristotle observed, art is imitation of an action. That being the case, and is being the case that praxeology is the study of human action, then the understandings derived from praxeological study should be applicable to analyzing literature.

    The Austrians rejected Historicism because it treated economics as purely historical and lawless. The Austrians rejected scientism because it treats economics as a physical science that can be understood through math. Between the two, so to speak, is the Austrian method, which understands economics as a complex process that cannot be perfectly modeled or predicted, but which can give pattern predictions. They are often accused of using "literary" methods (Don Lavoie in particular promoted hermeneutical approaches) -- which in fact makes it particularly suited for use in literary analysis. (I would argue too that more literary approaches are precisely what is necessary to understand anything as complex as human (inter)action.)

  5. I don't primarily use Austrian economics to deconstruct literature but I have, for my entire career as a novelist, short story writer, and screenwriter, used Austrian economics and games theory as tools in creating literature and drama -- even to the scene in the episode of Twilight Zone I wrote, "Profile in Silver," in which a time traveler uses a computer programmed with games theory to analyze alternative time-lines resulting from JFK not being assassinated on November 22, 1963.

    My first novel, Alongside Night, applied Austrian monetary theories to project the political and social consequences of a hyperinflationary crack-up boom in a future United States.

    My third novel, Escape from Heaven, applies praxeology to the Judeo-Christian paradigms of God's creation and a society of eternal beings. The humor of this last has often been missed by libertarian atheists who missed the point.

    Given how central a role Austrian economics has played in my literary and dramatic output, it's been disappointing to me how little attention Austrian-school institutions like the Mises Institute have given to fiction and drama, so I applaud your initiative.

  6. I hope you come by periodically and read and leave comments. :-)

    My own literary output is increasingly Austrian-influenced. You can find it in many of my poems and in my more recent plays.