Money, Bank Credit, and Economic Cycles - The Ludwig von Mises ...

Bank Credit Expansion and Its Effects on the Economic System 267believes it will help him to achieve. Means must be scarce bydefinition: if the actor did not regard them as such in light ofhis objectives, he would not even take them into accountbefore acting. Ends and means are not “given” (i.e., data) butinstead result from the fundamental entrepreneurial activityof human beings, an activity which consists of creating, discoveringor simply realizing which ends and means are relevantfor the actor in each set of specific circumstances of timeand place he encounters. Once the actor believes he has discoveredwhich ends are worth accomplishing, he forms anidea of the means available to assist him. He then incorporatesthem, almost always tacitly, into a plan of action which heembarks upon through an act of will.Consequently the plan is a mental picture, conjured up bythe actor, of the different future stages, elements and circumstanceshis action may involve. The plan is the actor’s personalevaluation of the practical information he possesses and graduallydiscovers within the context of each action. Moreovereach action implies a continuous process of individual or personalplanning through which the actor continually conceives,revises and modifies his plans, as he discovers and createsnew subjective information on the goals he sets himself andthe means he believes are available to assist him in reachingthese goals. 33 The development of economics as a science which is always based onhuman beings, the creative actors and protagonists in all socialprocesses and events (the subjectivist conception), is undoubtedly themost significant and characteristic contribution made by the AustrianSchool of economics, founded by Carl Menger. In fact Menger felt it vitalto abandon the sterile objectivism of the classical (Anglo-Saxon) schoolwhose members were obsessed with the supposed existence of externalobjective entities (social classes, aggregates, material factors of production,etc.). Menger held that economists should instead always adopt thesubjectivist view of human beings who act, and that this perspectiveshould invariably exert a decisive influence on the way all economictheories are formulated, in terms of their scientific content and theirpractical conclusions and results. On this topic see Huerta de Soto,“Génesis, esencia y evolución de la Escuela Austriaca de Economía,” inEstudios de economía política, chap. 1, pp. 17–55.