We must consider some knowledge as a priori. We can derive that knowledge only by using reason. Always test what people tell you about economic systems with reason. When you think about it, you will realize why government control and socialism cannot work effectively and efficiently.
I consider myself lucky that I did not have to study Latin in high school. Educators were beginning to realize that as a useful language, Latin had died. Some Latin words and phrases, however, just refused to die. Just ask a lawyer, doctor, or botanist.
Occasionally I encounter Latin terms or phrases, for which no reasonable English substitute exists, that provide valuable knowledge. “a priori” fits that criterion.
What does the term a priori mean, and how does it affect understanding the nature and operation of free markets?
The literal translation means “from the former or preceding.” The term refers to self-evident knowledge discovered by reason alone. Such knowledge does not arise from empirical evidence. A person has to gain such knowledge by using their mind alone.
Human systems (e.g., markets) do not lend themselves to experimental research because the subjects of that research learn. However, to understand human systems, we need basic principles. Because of the complex adaptive nature of human systems, we must have principles derived from reason: a priori principles.
In addition, the principle of discreteness (an a priori principle) plays a vital role in understanding free markets. From that premise, one can deduce why collective market systems (aka socialism) do not work effectively and efficiently. Indeed, socialism cannot work. The discrete nature of humans makes collective market systems only an impossible ideal.
The behavior of groups (or communities) of humans does create discernable patterns, but those patterns always arise as the result of individuals acting in concern, never as a single unit. Understanding the patterns of behavior formed in markets requires a priori knowledge of human systems.
In future posts, I will discuss fundamental a priori principles such as subjective value and the action axiom, which form the basis for a better understanding of the structure and behavior of free markets.
Understanding the meaning of a priori plays an essential role in understanding social sciences. We cannot submit living systems, particularly human systems, to rigorous inductive study because research processes cannot be repeated under identical conditions. Living systems learn; therefore, we cannot repeat experiments on them.
The discrete nature of humans and their ability to learn makes a priori concepts vital to studying markets.