Catallactics Explained

Catallactics is a theory of the way the free market system reaches exchange ratios and prices.[1] [2] [3] [4] It aims to analyse all actions based on monetary calculation and trace the formation of prices back to the point where an agent makes his or her choices.[5] It explains prices as they are, rather than as they "should" be. The laws of catallactics are not value judgments, but aim to be exact, empirical, and of universal validity. It was used extensively by the Austrian School economist Ludwig von Mises.[6]

Etymology

The term catallactics or catallaxy, respectively, comes from the Greek verb Greek, Ancient (to 1453);: καταλλάσσω which means to exchange, to reconcile.[7] [8]

Definition

Catallactics is a praxeological theory. The term catallaxy was used by Friedrich Hayek to describe "the order brought about by the mutual adjustment of many individual economies in a market."[9] Hayek was dissatisfied with the usage of the word "economy" because its Greek root, which translates as "household management", implies that economic agents in a market economy possess shared goals. He derived the word "Catallaxy" (Hayek's suggested Greek construction would be rendered καταλλαξία) from the Greek verb katallasso (καταλλάσσω) which meant not only "to exchange" but also "to admit in the community" and "to change from enemy into friend."[10]

According to Mises[11] and Hayek[12] it was Richard Whately who coined the term "catallactics". Whately's Introductory Lectures on Political Economy (1831) reads:[13] [14]

See also

Bibliography

External links

Notes and References

  1. Encyclopedia: Oxford English Dictionary third edition . catallactics . 3 October 2023. December 2002 . Oxford University Press.
  2. Encyclopedia: . catallactics . 3 October 2023. 2003 . 11th .
  3. Book: s.v. catallactics . The Oxford English Dictionary: Being a Corrected Re-Issue of with An Introduction, Supplement and Bibliography of a New English Dictionary on Historical Principles . 2 C . 1933 . Oxford . Clarendon Press . 170 . . 3 October 2023.
  4. Book: Rothbard, Murray N. . Murray N. Rothbard . Durlauf, Steven N. . Steven Durlauf . Blume, Lawrence E. . Lawrence E. Blume . catallactics . The New Palgrave Dictionary of Economics . 2nd . New York, NY . Palgrave Macmillan . 1 . 2008 . 704-705 . registration . Internet Archive.
  5. Book: Rutherford, Donald . Donald Rutherford (economist) . catallactics . Routledge Dictionary of Economics . 2nd . London and New York . Routledge . 2002 . registration . 75 . Internet Archive.
  6. Book: Kirzner, Israel M. . Israel Kirzner . Ludwig von Mises: The Man and His Economics . ISI Books . Wilmington, Delaware . 2001 . registration . 93-.
  7. Book: Liddell, Henry George . Henry George Liddell . Scott, Robert . Robert Scott (philologist) . A Greek - English Lexicon . Oxford . Clarendon Press . 1992 . 899 . registration . Internet Archive.
  8. Web site: s.v. καταλλάσσω . ΛΟΓΕΙΟΝ . 30 September 2023.
  9. Book: Hayek, F.A. . Law, Legislation, and Liberty (The Mirage of Social Justice) . 2 . London . Routledge . 1976 . 108–109.
  10. Book: Hayek, F.A. . Law, Legislation, and Liberty (The Mirage of Social Justice) . 2 . London . Routledge . 1976 . 108–109. See also p. 185 n4.
  11. Book: Mises, Ludwig . Ludwig Mises . Human Action: A Treatise on Economics . London . William Hodge and Company, Limited . 1949 . 3 . Internet Archive.
  12. Web site: Catallactics &education . 2010-07-14 . dead . https://web.archive.org/web/20100717142407/http://www.aare.edu.au/99pap/dev99089.htm . 2010-07-17 .
  13. Book: Whately, Richard . Richard Whately . Introductory Lectures on Political Economy: Delivered in Eastern Term, MDCCCXXXI . London . 1832 . B. Fellowes . 2nd . 6-7. . 27 September 2023.
  14. Web site: Online Library of Liberty - Reading Lists - Ian Dunois' Free Market foundations . 2010-07-14 . dead . https://web.archive.org/web/20100717041003/http://oll.libertyfund.org/readinglists/print/130-ian_dunois_free_market_foundations . 2010-07-17 . A footnote to this paragraph continues: "It is perhaps hardly necessary to observe, that I do not pretend to have classical authority for this use of the word Catallactics; nor do I deem it necessary to make any apology for using it without such authority. It would be thought, I conceive, an absurd pedantry to find fault with such words as "thermometer," "telescope," "pneumatics," "hydraulics," "geology," &c. on the ground that classical Greek writers have not employed them, or have taken them in a different sense. In the present instance, however, I am not sure that, if Aristotle had had occasion to express my meaning, he would not have used the very same word. In fact I may say he has used another part of the same verb in the sense of "exchanging;" (for the Verbals in are, to all practical purposes, to be regarded as parts of the verbs they are formed from) in the third book of the Nicom. Ethics he speaks of men who hold their lives so cheap, that they risked them in exchange for the most trifling gain (καταλλάττονται). The employment of this and kindred words in the sense of "reconcilement," is evidently secondary, reconciliation being commonly effected by a compensation; something accepted as an equivalent for loss or injury."

This article is licensed under the GNU Free Documentation License. It uses material from the Wikipedia article "Catallactics".

Except where otherwise indicated, Everything.Explained.Today is © Copyright 2009-2024, A B Cryer, All Rights Reserved. Cookie policy.