The Affinity between Pragmatism and institutionalism: Of Political Nature Only?
It is old, established knowledge that there are close political and ideological affinities between pragmatistic philosophy and the institutional position in economics. As Rick Tilman has recently expressed the matter, "the political counterpart of institutional economics is the instrumental political theory of John Dewey" (2001, 117). There is all the reason to think so, but I intend to develop the theme further and to show that the affinity between pragmatism and institutionalism is not just of political nature. I wish to make a somewhat stronger case to the effect that there are theoretical and conceptual commonalities between the two positions. In the title of this paper, I use the logical term "to imply"; I do this on purpose and entertain in serious terms the possibility that the affinity between pragmatism and institutionalism comes close to being of downright logical nature.
It is, of course, the professionals' job to decide what ultimately implies what in their discipline, and economics is not my profession. What I venture to do, nevertheless, is to say the first word, not so much the last word, about the theoretical kinship between pragmatism and institutionalism; final conclusions may belong to the expertise of professionals. The impression that I get from my reading in institutional economics is that a theoretical zero-sum game seems to be going on between this approach and the neoclassical one. This impression may be a bit too simple-my economic colleagues are welcome to correct it, if need be-but the least I can show is that pragmatism is seriously at odds with many of the methodological assumptions that neoclassical economics consistently takes for granted.
What Is Wrong with Methodological Individualism?
Pragmatism opens a new perspective from which to assess critically a central tenet in neoclassical methodology, that of methodological individualism. The first thing to be noted about it is that pragmatism has no quarrel with this position as long as it remains a methodological position. The problem is that it too seldom remains so. In fact, what is innocuously proffered as methodological individualism is too often taken as a position in social ontology. As Hans Joas, the social theorist, has put the matter, "the unreflected assertion that the self-interested, autonomous individual is the natural starting point in all social theory is deeply rooted in the possessive individualism of western culture" (1996, 184). This unreflected assumption, whose theoretical consequences are not always for the best, permeates contemporary social thinking in general and neoclassical economics in particular. (1)
From the viewpoint of pragmatism, the real fault with misunderstood, that is, ontologically interpreted, individualism is not that it treats human beings as separate individuals, although that already is a fault. Even graver is its fault in thinking about human actions as separate individuals, It is here where the ultimate source of even the former error lies. Instead of depicting human activity as a sequence of separate instantaneous "actions," pragmatism understands it as a unified ongoing process, even so that the acting subject's intentionality and rationality are to be found inside rather than outside that process. (2) The first thing to be said about this idea, in comparison with the traditional one, is that it is not only a different but a much more embracive conception. This means that nothing that is of value in the traditional interpretation needs to be sacrificed--its accomplishments do remain at our disposal--but at the same time we are now able to see further on the pragmatistic basis.
An adherent of methodological individualism might have an answer ready. He or she might say that its postulates are not to be taken as accurate empirical descriptions of behavior, economic or otherwise. They rather are to be taken as analytic abstractions whose task is to highlight the constitutive and most important element in human action: its rationality. The individualistic approach is wholesome, it is assumed, because it is best suited to express rationality in action. This interpretation maintains further that human rationality comes out most unambiguously in what is known as "rational choice." And what makes a choice "rational" is its reliance on preceding calculative operations. Thus goes the traditional individualistic argument about rationality, put in barest possible terms. However, the pragmatistic answer to all this still is that it is nor that simple.
The pragmatistic argument pinches the individualistic one from two sides. In the first place, granted that the individualistic postulates are meant as abstractions rather than descriptions, this is to no avail, if they are systematically one-sided abstractions, and so the case turns out to be, from the pragmatistic viewpoint. Recall what was too individualistic in methodological individualism: not only its treatment of human individuals one by one but even more so its treatment of human actions one by one. This leads to a systematic distortion in our understanding of what action is, pragmatism maintains. Furthermore, and more pointedly, such a treatment of actions eventually leads even to a distorted interpretation of what human rationality is. Methodological individualism maintains that if we want to treat action as rational, our only choice is the theory of rational choice. According to pragmatism it is not so; rational choice is a somewhat truncated and pedestrian description of rationality, because human rationality in its essence is a long-term affair.
The pragmatistic argument about rationality again pinches the traditional one from two angles, psychological and logical, as they might be called. First, the old rationalistic position is tacitly based on an idea that dates even further back in history than individualism itself. This is the classical notion of "faculty psychology," the idea of cognition, emotion, and conation as three separate faculties of the human mind. It dates back to Plato, if not to earlier times. It has enriched our art and science, but in the light of present-day knowledge it is rendered obsolete. Cognition and emotion are not two separate mental phenomena; they rather are entangled with each other and enforce each other. The first post-Darwinian philosophy, pragmatism, was also the first to notice this from a systematic viewpoint, and its argument is today carried on by evolutionary cognitive science and neuropsychology (Damasio 1995, 1999; Lakoff and Johnson 1999). The demolition of faculty psychology is bad news to methodological i ndividualism, because it now turns out that human reason is not in the main based on consciously rational operations. In other words, the exclusively calculative interpretation of rationality relies on dated psychology. And it even turns out to rely on dated logic, as such a logician as Charles S. Peirce can tell us. Human rationality comes to its own in inquiry, in truth-advancing (rather than truth-confirming) reasoning, according to his view, Rationality is a long-term affair, I asserted above, and this is to be taken literally. In the sense, namely, that merely adding up choices will never lead us to rationality itself, rationality is continuous sui generis, according to its pragmatistic interpretation.
The Message of Pragmatism: Relativism or Empirical Responsibility?
I have been talking about pragmatism for some time now without having defined it. When it first came forward, a hundred years ago or so, it gained a reputation as epistemological relativism. (3) Today the famous and illustrious philosopher Richard Rorty toys with the idea that this shows farsightedness on the original pragmatists side. I think, however, together with some others (Kloppenberg 1998; Westbrook 1998), that in so saying he just tries to make a virtue out of a supposed necessity, so that pragmatism in his treatment becomes but another version of contemporary post-modernism.
Above I called pragmatism the first post-Darwinian philosophy, and I think that George Lakoff and Mark Johnson (1999) have something similar in mind, as they praise John Dewey as an "empirically responsible philosopher." By this they mean that Dewey was aware of the state of the art in empirical science, natural and social, and took pains not to contradict it in his philosophical conclusions, although his philosophy is not empiricistic in the traditional sense (cf. Ryan 1995). The only thing to be added is that this description fits as well, if not better, those other pragmatists who also are relevant in regard to our problem, C. H. Mead and Peirce. Furthermore, my opinion is that should we search for pragmatists among our contemporaries; empirically responsible philosophers rather than post-modern relativists would fill the bill. By this I mean such philosophers of mind as D. C. Dennett (1995), Radu Bogdan (1997, 2000), and Lakoff and Johnson (1999), who draw on the findings of evolutionary cognitive science and related sources. I don't know whether they like to be called pragmatists, (4) but I see them continuing the tradition that Peirce, Dewey, and Mead inaugurated and sometimes giving it fresh new corroboration. (5)
In what follows, I draw on both the classical pragmatists and these like-minded later thinkers. Before going further, a brief word is needed about why it is important to include also Peirce's contribution as a part of Our argument. There are two heavy reasons for this. In the first place, Peirce's presence reminds us that the kinship between pragmatism and institutionalism definitely is not of mere political nature, because he differs radically from the other pragmatists in his politics. Dewey and Mead belong to the "progressive" movement in their politics and social thinking (Joas 1985; Cook 1993; Feffer 1993; Diggins 1994; Ryan 1995), whereas Peirce always remained a staunch conservative. This difference extends even to the domain of economics, where Peirce's more favorable attitude toward the theory of marginal utility is in contrast with Dewey's respective position (cf. Peirce CP 4.114; CN 1, 173-74; HP 2,1115; all from 1893; NEM 4, 27ff.; 1902). The crucial point, however--and this is the second reason f or including Peirce--is that his favorable opinion does not extend to approving assumptions about human action and human rationality that are basic in neoclassical microanalysis. Peirce's disagreement with the neoclassicals in this respect is important, because it is most of all of logical nature, and he is the logician of the pragmatistic tradition. Or actually not of that tradition only, he is one of the outstanding classics in the entire history of logic (Dipert 1995; Hintikka 1997). Accordingly, the political positions of the pragmatist philosophers cancel out each other, but the fact remains that this philosophy is seriously at odds with the individualistic suppositions about human action and human reason thatmodern neoclassical economics constantly takes for granted.
In order to marshal evidence to back up this opinion, I proceed as follows. First, I take a look at an explicit confrontation between pragmatism and neoclassical economics in Dewey's work. Thanks to Tilman and Terry Knapp's excellent historical essay, "John Dewey's Unknown Critique of Marginal Utility Doctrine" (1999), we know that such a confrontation has taken place. After this I show that this encounter is not just ad hoc but reflects Dewey's deeper philosophical commitments. And it does not reflect just his commitments; this critical position is shared by other pragmatist philosophers, Mead and Peirce in particular. Finally, it is not just a philosophical position that is in question. Although these thinkers are known as classical philosophers, their ideas are often also empirical hypotheses that are worth taking seriously. The reason to think so is that current scholarship and research are converging toward original pragmatistic conclusions, as I said. Let us now see how Dewey went about his criticism of the theory of marginal utility and of neoclassical economics in wider terms.
John Dewey's Social Psychological Critique of Neoclassical Economics
Tilman and Knapp (1999), I said, have made a service in unearthing Dewey's hitherto unknown, explicitly critical opinions about the theory of marginal utility. Dewey had presented them in his lectures, and according to his interpreters he there "argued that on social psychological grounds alone ontological and methodological individualism were deficient" (405). This concerns us, because a moment ago I had reason to complain about precisely this conflation in the neoclassical position. However, Tilman and Knapp's argument can even be widened, so that it turns out that the question is not just about a single encounter where Dewey showed a lack of enthusiasm for recent neoclassical economic views.
Dewey's most extensive systematic treatment of social psychology is entitled Human Nature and Conduct (1922). It is also the work where his action-theoretic position comes out most unambiguously. Furthermore, even here Dewey's argument is directed against an economic adversary, as he called the position that he opposed "current economic psychology" (1922, 122 et passim). His point against it is that
Those who attempt to defend the necessity of existing economic institutions as manifestations of human nature convert [a] suggestion of a concrete inquiry into a generalized truth and hence into a definite falsity. They take [the idea to be] that nobody would do anything, or at least anything of use to others, without a prospect of some tangible reward. And beneath this false proposition there is another assumption still more monstruous, namely, that man exists naturally in a state of rest so that he requires some external force to set him into action....The idea of a thing intrinsically wholly inert in the sense of absolutely passive is expelled from physics and has taken refuge in the psychology of current economics. In truth man acts anyway, he can't help acting. In every fundamental sense it is false that a man requires a motive to make him do something. (Dewey 1922, 118)
To say this is to attack neoclassical economics, because its position has traditionally been that "The raison d'etre of economics as a separate science is that it deals chiefly with that part of man s action which is most under the control of measurable motives," as Alfred Marshall put it in his founding presentation of the doctrine (1890, 114). Thus, what for Marshall makes the subject matter of economics was a mere trifle for Dewey, not to say a non-existent thing. Further, as Marshall defined motives as the "motor force or incentives to action" (1890, 76), this was for Dewey but the same thing as the traditional Utilitarian idea about motives as "springs of action" (Bentham 1817). True, in his Principles Marshall made an explicit case against the idea that "economists are adherents of the philosophical system of Hedonism or of Utilitarianism" (1890, 77n), but this does not resolve the issue, because pragmatism finds economists Utilitarian even in an empirical sense. The mere assumption that "springs" or i ncenttves" are needed, for any action to take place, renders their thinking Utilitarian (cf. also Veblen 1932a,b).
Current economic psychology thus makes dubious psychology, in Dewey's opinion, on closer analysis in the following sense:
No doubt we sometimes fall to deliberating upon the effect of action upon our future feelings, thinking of a situation mainly with references to the comforts and discomforts it will excite in us. But those moments are precisely our sentimental moments of self-pity and self-glorification. They conduce to morbidity, sophistication, isolation from others; while facing our acts in terms of their objective consequences leads to enlightenment and to consideration of others. The first objection therefore to deliberation as a calculation of future feelings is that, if it is consistently adhered to, it makes an abnormal case the standard one. (1922, 202)
An abnormal case is made the standard one-in what sense exactly? In three senses in all, it turns out. First, according to the Utilitarian and economic interpretation, human doings take place against a universal passive backdrop, but this is a "monstruous" assumption, as Dewey said above. The second abnormality concerns the nature of human choice, economic or otherwise. As Dewey explained elsewhere in his book, pace Utilitarians and neoclassicists, "Choice is not the emergence of a preference out of indifference. It is the emergence of a unified preference out of competing preferences" (1922, 193). His third point nails down the pragmatistic argument. Economic thinking veers toward abnormality already when it understands "deliberation as calculation." To a Utilitarian-and to many an economist-calculation is what human rationality is all about. (6) To a pragmatist it is a statistically prevalent, but theoretically pedestrian, application of human rationality proper.
A pragmatist finds even some logical fault in the understanding of deliberation as calculation. The philosopher to show this in detail is Peirce rather than Dewey, but the latter's above passage sets the stage aptly for further analysis. Recall now what was problematic with methodological individualism: It does not remain methodological; it too easily turns into a position of social ontology. It does so in two mutually related senses: by treating human beings as self-sufficient individuals and by treating human actions as self-sufficient individuals. Pragmatism challenges both of these assumptions, and its unique feature is that it is able to challenge also the latter, even on sundry logical grounds. We have here reached a focal point in our inquiry. As Dewey said above that in truth man acts anyway and cannot help acting, this expresses the pragmatistic interpretation that human action is an ongoing process, not a discrete series of happenings. What remains to be done now is to treat the two other related i ssues: (1) the description of action as an individual affair, as is usual in methodological individualism and (2) the description of human rationality as a calculative affair, which is as usual in that tradition. This is best done with the help of two other classic pragmatists, Mead and Peirce. With the help of Mead, we can deny the individual constitution of human action, so to say, that the case is necessarily about human actors one by one. It is not about human doings one by one, either; this we already heard from Dewey. Third, with the help of Peirce we can conclude that the case is not about human reasonings one by one and, further, that reasonings are not exclusively calculative operations. Together, Mead's and Peirce's respective conclusions enable us to take our argument a step further, from criticism of methodological individualism toward what might be called a critique of monological reason. The individualistic interpretation of human reason is monological in two senses: (1) it is monological as opp osed to dialogical and (2) it is monological in the sense that its logical structure is a stepwise chain-structure. Peirce's logic and related viewpoints enable us to see that it does not have to be so.
From Criticism of Methodological Individualism toward a Critique of Monological Reason
Pragmatism's general position in social matters comes out aptly in Peirce's dictum: "Man is essentially a social animal, but to be social is one thing, to be gregarious is another" (Peirce CP 1.11; c. 1897). This is a point too often missed in discussions about methodological individualism. We can see now that the methodological dispute is not necessarily between individualism and collectivism, as it traditionally has been represented. (7) To vouch for the social nature of human beings does not imply treating them only in cohorts. But it does mean the following: Human individuals are not first "just human" and then "enter" social relations--as too often is the tacit understanding behind individualism. To be human and to live in social relations amounts to the same thing.
This idea has its great theorist in the pragmatistic tradition in Mead. As his leading expositor, Joas, has expressed the idea, Mead's greatest discovery is his understanding of intersubjectivity as an anthropological universal. By this is meant that "even in the case of the individual who acts in an instrumental fashion without any manifest cooperative relations with others, [it cannot be assumed] that it is a matter of a kind of action that the intersubjective matrix in which the capacity for action originated does not constitutively enter into" (Joas 1985, 145). (8) To put this in somewhat blunter terms, this means that social action or joint action is the paradigmatic form of human action; what is known as individual action is a special case of the former. Of course, every one of us does things in an individual, personal, even idiosyncratic manner, but the point is that our capacity to do anything at all is something we have acquired under the tutelage of others. Human agency is an accomplishment, not so mething ready-made with which we enter this world (cf. Johnson 1987), and it is accomplished in interaction with others. This pragmatistic interpretation about the social nature of all human doings thus gives ample support to the position of evolutionary economics, as this maintains, in the words of Geoffrey Hodgson, that the "basic element in society is not the abstract individual, but the social individual" (1988, 71). So it turns out to be, but the evolutionary argument in economics receives even further backup from pragmatism, also so far as the interpretation of rationality is concerned.
Even here Hodgson has stated the problem aptly. As he has pointed out, the economic interpretation of rationality does little justice to the undeniable fact that human individuals are capable of learning, not just possessing knowledge. In his words, "How can agents be said to be rational at a given point in time when they are in the process of learning and acquiring relevant information? The very act of learning means that not all Information is possessed and global rationality is ruled out" (1993, 4). Indeed, but this is where the pragmatistic interpretation of rationality comes in, in the hands of Peirce, and maintains that the capability of learning, not mere knowledge possessing, precisely is the defining characteristic of human rationality.
Peirce is famous as a logician, but the first thing to be noted is his insistence to the effect that "our ordinary reasonings, [even] so far as they are deductive, are not, in the main, such syllogisms as the books have taught, but are just such inferences as are particularly dealt with in this new branch of logic" (Peirce CN 2,132; 1896). By "this new branch of logic" Peirce referred to the "logic of relatives," as he called his own new, revolutionizing interpretation of logic. He intended two tasks for it: (1) to advance logical theory (9) and (2) to spell out what happens in the human mind when human beings are using their reason. In his own words, the basic idea in his new conception is "of extreme importance for the theory of cognition" (NEM 4, 56; c. 1902).
According to Peirce, all human thinking is basically-though in the main only implicitly-of inferential nature, and it draws two kinds of inferences during its course: truth-confirming, or explicative, and truth-advancing, or ampliative inferences, respectively. Today it is widely known, also in institutionalist literature (see in particular Dyer 1986), that he distinguished not two but three basic modes of inference, deduction, induction, and abduction, of which the last one is the typical ampliative mode. What is still much less known is that even deductive inference may have an ampliative, knowledge-advancing task of its own, in his conception.
Peirce shared the traditional opinion about the general deductive nature of mathematical reasoning (NEM 4, 47; 1902; CP 5.148; 1903. On this domain, however, he drew a novel distinction, one between what he called (1) "corollarial deduction," which answers to our traditional notion of deductively proceeding rational inference and (2) "theorematic," or creative, deduction, which is able to yield new, unforeseen truths (see, e.g., Peirce EP 2, 96; 1901; NEM 4, 49; 1902). Theorematic deduction, furthermore, yields a number of conclusions as its result, not just one conclusion as is the case in syllogistic reasoning, so that even an element of choice is involved in its use (Peirce NEM 4, 354; 1893). Thus, the mutual relation between these two modes of deductive inference is such that corollarial deduction--which answers to our traditional understanding of calculative rationality--is to be taken as a special, simpler subcase under the more dynamic mode of theorematic, truth-advancing deduction. In other words, Pe irce's logic enables us to question the universalistic aspirations of the calculative use of reason that neoclassical methodology and related approaches obediently take for granted.
There is even more to come. The fault of methodological individualism, I have asserted, lies in its understanding of human actions as separate instantaneous entities. Peirce's interpretation of rationality has bearing on this question because he maintains that all human thinking "implies existential action," in other words, concrete action in the concrete world (CP 6.324; 1909). Now, how in particular does it imply action, if thinking even in the deductive domain yields general patterns, rather than singular conclusions, as its outcome, as we just have seen? Jaakko Hintikka, one of Peirce's leading exposirors today, provides an answer. According to him, Peirce's dynamic, theorematic interpretation of human rational thought yields as its results at the concrete level "general policies" rather than singular actions. As thought implies existential action, in Peirce's conception, this "can scarcely mean a preference for one particular action in one particular kind of situation, but presumably means a policy reco mmendation" (Hintikka 1998, 516).
So it means also according to Peirce's own testimony. He maintained that rational thinking yields as its result "some implication concerning the general behavior either of some conscious being or of some inanimate object, and so [conveys] more, not merely than any feeling, but more, too, than any existential fact, namely the 'would-acts' of habitual behavior; and no agglomeration of actual happenings can ever completely fill up the meaning of a 'would be"' (EP 2, 401-402; c. 1907; original emphasis). So far so good, but can we be quite sure that he meant also individual actions by that "agglomeration of actual happenings?" We can, because only a few months after the above passage Peirce was writing laconically that
Every action of Napoleon was such as a treatise on physiology ought to describe. He walked, ate, slept, worked in his study, rode his horse, talked to his fellows, just as every other man does. But he combined those elements into shapes that have not been matched in modern times.... [Accordingly,] our power of self-control [i.e., our rationality--E.K.] certainly does not reside in the smallest bits of our conduct, but is an effect of building up a character. (CP 4.611; 1908)
Here we have it. As long as we take Napoleon's actions one by one, they remain pedestrian phenomena and devoid of any rationality to speak of. Peirce maintained that even physiology with its reductive means would be able to treat them in that case. But in so far as they constitute Napoleon's policies, his conduct of life, as Peirce's own expression goes, then they also show an impressive amount of rationality. Peirce's point can also be generalized, and then it suggests the following. The question of rationality in human conduct concerns this conduct in its entirety, as an ongoing long-term process. During its course human beings do make also calculations and rational choices, but these are ancillary reflections of our rationality, rather than its defining characteristics. If your logical armature is capable of treating only singular actions one by one--as the case seems to be with the calculative interpretation of rationality--then you are sacrificing a great deal of the possibilities of human rationality, its most important, creative part included. In that case your rationality-concept is able to handle only "static and given" things, as Thorstein Veblen (1932c) said in his own critical assessment of the theory of marginal utility.
Instead of a Conclusion: Some Emerging Empirical Verifications
I said above that some of the ideas of the pragmatist philosophers are not merely philosophical opinions among others but can even be taken as novel empirical hypotheses. So is the case also with regard to their new interpretation of human subjectivity and rationality. It turns out to receive surprisingly ample corroboration from contemporary empirical research. The best example to show this is the neuropsychological research which Antonio Damasio reported in his Descartes' Error (1995; see also Damasio 1999).
In the first place, Damasio (1995) vindicated both Mead's original insight about the intersubjective constitution of human reason and Peirce's point about the insufficiency of mere calculative operations in its depiction. As regards the former question, Damasio's main finding is that a loss in one's intersubjectivity--as can happen due to brain injury, for example--eventually makes even one's rational and intellectual capabilities deteriorate. In his own words, "systems associated with planning and deciding behaviors [might be subsumed] under the rubric 'personal and social.' There is a hint that these systems are related to the aspect of reason usually designated as rationality" (Damasio 1995, 78). Furthermore, once the individualistic constitution of human reason is disputed, it takes only a short step to come to the conclusion that its right locus is in social practices, rather than in individual actions, and this is also Damasio's conclusion. He corroborated the original insights of the pragmarists by ma intaining that "Reason, from the practical to the theoretical, is probably constructed on [an inherent drive of "passion for reasoning"], by a process which resembles the mastering of a skill or craft. Remove the drive, and you will not acquire the mastery. But having the drive does not automatically make you a master" (Damasio 1995, 245-46; cf. Peirce CP 6.145; 1892). Indeed, Damasio vindicated even the Peircean point about the insufficiency of the calculative interpretation of rationality, as he wrote that
The traditional, "high-reason" view, which is none other than the common-sense view, assumes that when we are at our decision-making best, we are the pride and joy of Plato, Descartes and Kant. Formal logic will, by itself, get us to the best available solution for any problem. An important aspect of the rationalist conception is that to obtain the best results, emotions must be kept out. Rational processing must be unencumbered by passion.... Basically, in the high-reason view, you take the different scenarios apart and to use current managerial parlance you perform a cost/benefit analysis of each of them. Keeping in mind "subjective expected utility," which is the thing you want to maximize, you infer logically what is good and what is bad.... Now, let me submit that if this strategy is the only one you have available, rationality, as described above, is not going to work. At best, your decision will take an inordinately long time, far more than acceptable if you are to get anything else done that day. At w orst, you may not even end up with a decision at all because you will get lost in the byways of your calculation. (Damasio 1995, 171-172; original emphasis)
Accordingly, Damasio suggested in strong terms that "an alternative view is needed" (1995, 173) to replace the rationalistic one, but it turns out that the first outlines for such an alternative view have already been drawn by the classical pragmatists. Peirce in particular realized that human reason comes to its own in the recognition of general patterns; cost/benefit calculations make only auxiliary operations. At the concrete level such recognition of patterns yields general policies, not just individual actions, as its outcomes. I submit that the original pragmatistic argument, backed up by these more recent corroborations, makes a very strong case against the neoclassical account of human action and its rationality. Is this the same thing as a vindication of the institutionalist approach? This I leave to economists to decide. Instead of an economic conclusion I thus offer one for social policy and social theory. Our social policies should enhance people's capacity for intersubjectivity, which amounts to the same thing, we have seen, as enhancing their rationality. This means that our social policies should advance, in the first place, free, equal, and open societies, market economies only after that. The reason for this order of things is that mere market relations do not suffice to make people as rational as they can be.
(1.) An influential case in point in social theory is Coleman 1990. In economics, Ludwig von Mises's (1949) formulation of this principle seems to enjoy a classical status.
(2.) For definite statements to this effect, see Peirce (W3, 263; 1878; CP 4.611; 1908; Dewey 1922, 223; and Mead 1936, 345. Citations from C. S. Peirce are according to the following established code of abbreviations: CP = Collected Papers of Charles Sanders Peirce, 8 volumes, edited by C. Hartahorne, P. Weiss, and A.W. Burks, 1931-58; NEM = New Elements of Mathematics, by Charles S. Peirce, 4 volumes, edited by Carolyn Eisele, 1976; CN = Contributions to "The Nation," 4 volumes, edited by K. L. Ketner and J. E. Cook, 1975-87; W = Writings of Charles S. Peirce: A Chronological Edition, edited by The Peirce Edition Project, 1982-; HP = Historical Perspectives on Peirce's Logic of Science, 2 volumes, edited by Carolyn Eisele, 1985; EP = The Essential Peirce, 2 volumes, edited by The Peirce Edition Project, 1992-1998. In addition, Peirce scholars nowadays consider it good manners to include also the year when Peirce has either published or written the cited text, and I follow this practice. Of late, Peirce has appeared also in institutionalist literature. See, e.g., Dyer 1986, Liebhafsky 1993, Hodgson 1993, Peukett 1998, and Kilpinen 1998 and 1999.
(3.) Pragmatism's reputation as epistemological relativism is mainly due to two reasons: (1) Some careless expressions that William James used in the first pragmaristic manifesto, his Pragmatism of 1907 and (2) contemporary philosophers' inability to realize that philosophy does not necessarily begin from epistemology but still can take the problem of knowledge quite seriously. In pragmatism, the first post-Darwinian philosophy, the problem of knowledge comes after the problem of action. The reason for this order of things is that all living beings act, but only human beings pose questions of knowledge.
(4.) They occasionally refer briefly to classical pragmatists, mostly John Dewey, so that the comparison is not quite gratuitous.
(5.) It goes without saying that this characterization is meant to include today's self-avowed pragmatistic social scientists such as Hans Joas and Dmitri Shalin. My own position is very close to theirs.
(6.) It has been so ever since Thomas Hobbes's 1651 Leviathan, via Jeremy Bentham's 1789 Introduction to the Principles of Morals and Legislation, all the way to Alfred Marshall's Principles (1890) and Mises's Human Action (1949). For page references, see Hobbes 1968, 110ff., Bentham 1987, 111; Marshall 1890, 80ff.; and Mises 1949, 2ff., 38ff., etc.
(7.) For a quite sophisticated recent defense of methodological individualism against collectivism, see Turner 2002.
(8.) In the secondary literature on George Herbert Mead, Joas 1985 and Cook 1993 are the basic texts. I have recently contributed to the genre by treating Mead as a general semiotician (Kilpinen 2002). For those to whom the idea of universal intersubjectivity might seem counter-intuitive: Think what its opposite, the total lack of intersubjectivity, would be like. It is what is known as "mind-blindness," or autism. Mead's far-sightedness comes out in the fact that it was only after his lifetime, in the 1940s, that autism was definitely diagnosed as a psychological pathology. On this question, see further Bettelheim 1967, Trevarthen 1993, Baron-Cohen 1995, Damasio 1995 and 1999, Plotkin 1995 and 1998, Bogdan 1997 and 2000), and Lakoff and Johnson 1999.
(9.) In the history and theory of logic, Peirce is today remembered as the co-discoverer of the theory of logical quantification, together with Gottlob Frege (Hintikka 1997). His "logic of relatives" answers approximately to what Fregean logicians call "first-order quantified predicate logic."
Baron-Cohen, Simon. Mindblindness: An Essay on Autism and Theory of Mind. Cambridge, Mass., and London: MIT Press, 1995.
Bentham, Jeremy. An Introduction to the Principles of Morale and Legislation. Abridged in John Stuart Mill and Jeremy Bentham: Utilitarianism and Other Essays, edited by A. Ryan. Harmondsworth, U.K.: Penguin, 1987. First published in 1789.
-----. Table of the Springs of Action. London: R.C. Hunter, 1817.
Bettelheim, Bruno. The Empty fortress: Infantile Autism and the Birth of the Self. New York and London: The Free Press & Collier Macmillan, 1967.
Bogdan, Radu. Interpreting Minds: The Evolution of a Practice. Cambridge, Mass.: MIT Press, 1997.
-----. Minding Minds: Evolving a Reflexive Mind in Interpreting Others. Cambridge, Mass.: MIT Press, 2000.
Coleman, James. The Foundations of Social Theory. Cambridge, Mass.: Harvard University Press, 1990.
Cook, Gary A. George Herbert Mead: The Making of a Social Pragmatist. Urbana-Champaign, Ill.: University of Illinois Press, 1993.
Damasio, Antonio. Descartes' Error: Emotion, Reason, and the Human Brain. London and New York: Picador & Avon Books, 1995.
-----. The Feeling of What Happens: Emotion and the Making of Consciousness. New York: Harcourt Brace, 1999.
Dennett, D.C. Darwin's Dangerous Idea: Evolution and the Meanings of Life. New York: Simon & Schuster, 1995.
Dewey, John. Human Nature and Conduct: An Introduction to Social Psychology. New York: Henry Holt, 1922.
Diggins, John. The Promise of Pragmatism: Modernism and the Crisis of Knowledge and Authority. Chicago: University of Chicago Press, 1994.
Dipert, Randall. "Peirce's Underestimated Place in the History of Logic: A Response to Quine." In Peirce and Contemporary Thought: Philosophical Inquiries, edited by K. L. Ketner, New York: Fordham University Press, 1995.
Dyer, Alan. "Veblen on Scientific Creativity: The Influence of Charles S. Peirce." Journal of Economic Issues 20, no. 1 (March 1986): 21-41.
Feffer, Andrew. The Chicago Pragmatists and American Progressivism. Ithaca, N.Y.: Cornell University Press, 1993.
Hintikka, Jaakko. "The Place of C. S. Peirce in the History of Logical Theory." In The Rule of Reason: The Philosophy of Charles Sanders Peirce, edited by J. Brunning and P. Forster. Toronto, Buffalo, N.Y., and London: University of Toronto Press, 1997.
-----. "What Is Abduction? The Fundamental Problem of Contemporary Epistemology." Transactions of the Charles S. Peirce Society 34, no. 3 (1998): 503-533.
Hobbes, Thomas. Leviathan, or The Matter, Form, and Power of a Common-Wealth. Ecclesiasticall and Civill. 1651. Reprint, edited with an introduction by C. B. Macpherson. Harmondsworth, U.K.: Penguin, 1968.
Hodgson, Geoffrey. Economics and Institutions: A Manifesto for a Modern Institutional Economics. Cambridge, U.K.: Polity Press, 1988.
-----. Economies and Evolution: Bringing Life Back into Economies. Cambridge, U.K.: Polity Press, 1993.
James, William. "Pragmatism: A New Name for Some Old Ways of Thinking." In The Works of William James, edited by Ignas Skrupakelis et al. Cambridge, Mass., and London, England: Harvard University Press, 1975.
Joas, Hans. George Herbert Mead: A Contemporary Re-examination of His Thought. Cambridge, U.K.: Polity Press; Cambridge, Mass.: MIT Press, 1985. Originally published as Praktische Intersubjektivitat, Frankfurt: Suhrkamp, 1980.
-----. The Creativity of Action. Cambridge, U.K.: Polity Press; Chicago: University of Chicago Press, 1996. Originally published as Die Kreativitat des Handelns, Frankfurt: Suhrkamp, 1992.
Johnson, Mark. The Body in the Mind: The Bodily Basis of Meaning, Imagination, and Reason. Chicago and London: University of Chicago Press, 1987.
Kilpinen, Erkki. "The Pragmatic Foundations of the Institutionalistic Method: Veblen's Preconceptions and their Relation to Peirce and Dewey." In Institutionalist Method and Value: Essays in Honour of Paul Dale Bush, vol. 1, edited by S. Fayazmanesh and M. R. Tool. Cheltenham, U.K.: Edward Elgar, 1998.
-----. "What is Rationality? A New Reading of Veblen's Critique of Utilitarian Hedonism." International Journal of Polities, Culture and Society 13, no.2(1999): 187-206.
-----. "A Neglected Classic Vindicated: The Place of George Herbert Mead in the General Tradition of Semiotics." Semiotica 142, 1/4 (2002): 1-30.
Kloppenberg, James. "Pragmatism: An Old Name for Some New Ways of Thinking?" In The Revival of Pragmatism, edited by M. Dickstein. Durham, N.C.: Duke University Press, 1998.
Lakoff, George, and Mark Johnson. Philosophy in the Flesh: The Embodied Mind and Its Challenge to Western Thought. New York: Basic Books, 1999.
Liebhafsky, E. E. "The Influence of Charles Sanders Peirce on Institutional Economies." Journal of Economic Issues 27, no. 3 (September 1993): 741-754.
Marshall, Alfred. Principles of Economies. London and New York: Macmillan, 1890.
Mead, G. H. Movements of Thought in the Nineteenth Century. Edited by M. H. Moore. Chicago: University of Chicago Press, 1936.
Mises, Ludwig von. Human Action: A Treatise on Economics. New Haven, Conn.: Yale University Press, 1949.
Peirce, C. S. Collected Papers of Charles Sanders Peirce (CP). Vols. 1-6. Edited by C. Hartsborne and P. Weiss; vols. 7-8 edited by A. W. Burks. Cambridge, Mass: Harvard University Press, 1931-35, 1958.
-----. New Elements of Mathematics, by Charles S. Peirce (NEM). 4 vols. Edited by Carolyn Eisele. The Hague and Patio: Mouton, 1976.
-----. Contributions to "The Nation" (CN). 4 vols. Edited by K. L. Ketner and J. E. Cook. Lubbock, Tex.: Texas Tech University Press, 1975-1987.
-----. Writings of Charles S. Peirce: A Chronological Edition (W). Edited by The Peirce Edition Project. Blooming. ton and Indianapolis: Indiana University Press, 1982.
-----. Historical Perspectives on Peirce's Logic of Science (HP). 2 vole. Edited by Carolyn Eisele. Berlin, New York, and Amsterdam: Mouton de Gruyter, 1985.
-----. The Essential Peirce: Selected Philosophical Writings (EP). Vol. 1, edited by N. Houser and C. Kloesel, 1992. Vol. 2 edited by the Peirce Edition Project, 1998. Bloomington and Indianapolis: Indiana University Press, 1998.
Peukett, Helge. Das Handlungsparadigma in der Nationalokonomie. Marburg, Germany: Metropolis-Verlag, 1998.
Plotkin, Henry. Darwin Machines and the Nature of Knowledge. Harmondsworth, U.K.: Penguin, 1995.
-----. Evolution in Mind: An Introduction to Evolutionary Psychology. Harmondsworth, U.K.: Penguin, 1998. Ryan, Alan. John Dewey and the High Tide of American Liberalism. New York and London: W. W. Norton, 1995.
Tilman, Rick. "Institutional Economics, Instrumental Political Theory, and the American Tradition of Empirical Collectivisim." Journal of Economic Issues 35, no. 1 (March 2001): 117-138.
Tilman, Rick, and Terry Knapp. "John Dewey's Unknown Critique of Marginal Utility Doctrine: Instrumentalism, Motivation, and Values," Journal of the History of the Behavioral Sciences vol. 35, no. 4 (1999): 391-408.
Trevarthen, Colwyn. "The Self Born in Intersubjectivity." In The Perceived Self, edited by U. Neisser. Cambridge: Cambridge University Press, 1993.
Turner, Stephen P. Brains/Practices/Relativism: Social Theory after Cognitive Science. Chicago and London: University of Chicago Press, 2002.
Veblen, Thorstein. "Why Is Economics Not an Evolutionary Science?" In The Place of Science in Modem Civilization, and Other Essays. 1919. Reprint, New York: Viking Press, 1932a.
-----. "The Preconceptions of Economic Science, I-III." In The Place of Science in Modern Civilization, and Other Essays. 1899-1900. Reprint, New York: Viking Press, 1932b.
-----. "The Limitations of Marginal Utility." In The Place of Science in Modern Civilization, and Other Essays. 1909. Reprint, New York: Viking Press, 1932c.
Westbrook, Robert. "Pragmatism and Democracy." In The Revival of Pragmatism, edited by M. Dickstein. Durham, N.C.: Duke University Press, 1998.
The author is a researcher at the University of Helsinki, Finland. An earlier version of this paper was presented at the Clarence E. Ayres Memorial Session during the annual meeting of the Association for Evolutionary Economics, Washington, D.C., January 3--5, 2003. The author thanks this association, especially its presidents lames Swaney and James Peach, for the invitation to attend this meeting as the Clarence E. Ayres visiting scholar.…