Far from a nihilistic crowd: The theoretical contribution
of radical subjectivist Austrian economics
Published online: 9 February 2011
Springer Science+Business Media, LLC 2011
Abstract This paper compares and contrasts the hermeneutic turn advocated by Don
Lavoie in his 1985 essay on “The Interpretive Dimension of Economics” with the
ontological turn that was gathering momentum amongst other groups of heterodox
economists at about the same time. It is argued that an explicit focus on ontological
issues can complement and support the ‘interpretive turn’, most notably by helping to
show that the charge of nihilism that is sometimes levelled against Lavoie and his
followers is unwarranted. The argument is illustrated by a case study of one of the
inspirations of, and contributors to, Lavoie’sproject,namelyLudwigLachmann.
One of the central tenets of Don Lavoie’s approach to economics is that tradition
matters. In economic life, as we shall see, people’s reliance on shared traditions plays
a key role in enabling them to overcome uncertainty about the future and thereby act
in a purposeful fashion. In the history and methodology of economics, it is tradition
that helps to direct scholarly attention to some types of problem, deemed to be
important, rather than others (Lavoie 2011).
The importance of tradition is readily apparent in the framing and focus of Don
Lavoie’s elegant and insightful essay on “The Interpretive Dimension of Economics”
(Lavoie 2011). The essay is oriented towards the Popperian and Lakatosian tradition
of thought that dominated economic methodology in the 1970s and 1980s.
Rev Austrian Econ (2011) 24:185–198
As one commentator wrote of economic methodology prior to the 1990s, ‘A Popperian dominance,a
kind of Popperian mainstream in economic methodology has prevailed (Mäki 1993: 5).
P. Lewis (*)
King’s College London, London, UK