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Praxeology, broadly speaking, is the study of actions undertaken by humans, and in an economic sense, it refers to an approach to economics heavily reliant on the study of the actions of individuals. This view of economics was developed by Ludwig von Mises and the Austrian School. Human societies have been pondering the role of action in the lives of humans for thousands of years, with a number of Greek philosophers exploring praxeology, and subscribers to the Austrian School argue that economics could be considered a subset of praxeology. These theorists believe that economics is profoundly influenced by individual human choices.
According to Mises, one of the defining features of being human is the ability to make choices and engage in purposeful decision-making. This differentiates humans from other animals and also means that all human action has meaning and intent. Generally, Mises believed that humans undertook actions with the goal of personal betterment and gratification, even if a somewhat roundabout approach was required.
In the Austrian School of economics, human choices are believed to be the driving force behind the market, with groups of people organizing to create shifts in market conditions. People involved in investments and other economic activities have personal satisfaction as a goal and engage in behaviors intended to advance that goal. Observers attempting to study the role of human action also have an impact on the environment around them, making it extremely difficult to study economics in controlled conditions, let alone produce replicable experiments.
Under the logic of the action axiom, one of the grounding points of praxeology in economics, all people behave with purpose as they interact with the environment around them and adjust their behavior to meet changing conditions and needs. In economics, this can be clearly seen as investors shift investment strategies in order to take advantage of changes in the market. This approach to economics is not widely practiced today, although some people still believe it, or integrate aspects of it into a larger understanding of economics and the factors playing a role in economic activity.
A number of texts on the Austrian School and praxeology have been released and are available through publishers interested in economic studies. Such texts are sometimes examined in philosophy and economics classes to learn more about different theories of human behavior and its influence on the economy. Praxeology in general is studied in the humanities by students in a variety of subject areas interested in historical theories and their modern applications.