Dr. Jonathan Newman, an economist and instructor at the Mises Academy, dives deep into the essence of economics, unraveling its core differences from fields like psychology and history. He explains why economics prioritizes understanding over mere prediction and highlights the complexities of human decision-making. Newman also emphasizes the importance of economic education, particularly for homeschooling families, and critiques the limitations of empirical approaches, advocating for a more nuanced comprehension of human behavior in economic contexts.
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insights INSIGHT
Economics as Study of Choice
Economics helps understand human interactions and market phenomena universally through logical deductions, not through empirical generalizations alone.
It differs fundamentally from psychology and natural sciences as economics studies purposeful choice and action rather than mental states or matter.
insights INSIGHT
Economic Laws Are Apodictic
Economic laws are apodictically true like geometric theorems, derived by logical deduction from basic premises about human choice.
Their applicability depends on relevant conditions being met, similar to how geometric proofs assume specific shapes.
question_answer ANECDOTE
Nicolas Cage and Swimming Pools
A humorous observed correlation linked Nicolas Cage movies to drowning in swimming pools to show the absurdity of confusing correlation with causation.
Such spurious correlations illustrate why economics relies on logical deduction more than raw data correlation.
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Human action
A Treatise on Economics
Ludwig von Mises
Human Action is Ludwig von Mises' magnum opus, where he defends an a priori foundation for praxeology and methodological individualism. The book argues that the free-market economy outdistances any government-planned system and serves as the foundation of civilization. Mises explains complex market phenomena as the outcomes of countless conscious, purposive actions and choices of individuals. He critiques government attempts to regulate and control economic activities, emphasizing the futility and counter-productiveness of such interventions. The book is a systematic treatment of the whole body of social and economic relations, integrating various economic problems into a comprehensive system[2][4][5].
Economics in one lesson
Henry Hazlitt
In 'Economics in One Lesson', Henry Hazlitt provides a concise and instructive introduction to economics by dissecting common economic fallacies. The book's central lesson is that good economics involves considering the long-term and indirect consequences of any policy for all groups, not just the immediate effects on a specific group. Hazlitt uses examples like the 'broken window fallacy' to illustrate how focusing only on immediate benefits can overlook the broader, often negative, consequences. The book advocates for free markets, economic liberty, and non-governmental solutions, making it a critical read for understanding basic economic principles and the pitfalls of government intervention[1][4][5].
Lessons for the young economist
Robert P. Murphy
Lessons for the Young Economist provides a clear and engaging introduction to economics, balancing traditional economic theory with the Austrian School perspective. It offers insights into how markets work, the division of labor, and the role of prices in coordinating economic activity. The book is praised for its logical clarity and accessibility, making it suitable for both beginners and those familiar with economics.
Dr. Jonathan Newman returns to the Human Action Podcast to discuss the relaunch of the Mises Academy—including his new course based on Bob's Lessons for the Young Economist textbook. But this conversation goes much deeper than curriculum. Bob and Jonathan unpack the fundamental question: What is economics, really? They explore how Austrian economics differs from psychology, history, and the natural sciences, why economics is more about understanding than prediction, and how praxeology reveals the logical structure of human choice.
Bob's Lessons for the Young Economist Teacher's Manual: Mises.org/HAP498c
The Mises Institute is giving away 100,000 copies of Murray Rothbard’s, What Has Government Done to Our Money? Get your free copy at Mises.org/HAPodFree
The Human Action Podcast 
