The philosophical background

In <#32#>The Counter Revolution of Science<#32#> Hayek is concerned to contrast the natural and social sciences, whose relation to their subject matter, he claims, is fundamentally different. In the natural sciences, advances involve recognising that things are not what they seem. Science dissolves the immediate categories of subjective experience and replaces them with underlying, often hidden, causes. The study of society on the other hand has to take as its raw material the ideas and beliefs of people in society. The facts studied by social science

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differ from the facts of the physical sciences in being beliefs or opinions held by particular people, beliefs which as such are our data, irrespective of whether they are true or false, and which, moreover, we cannot directly observe in the minds of people but which we can recognise from what they say or do merely because we have ourselves a mind similar to theirs. (Hayek, 1955, p. 28)
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He argues that there is an irreducible subjective element to the subject mater of the social sciences which was absent in the physical sciences.

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[M]ost of the objects of social or human action are not ``objective facts;SPMquot; in the special narrow sense in which the term is used in the Sciences and contrasted to ``opinions;SPMquot;, and they cannot at all be defined in physical terms. So far as human actions are concerned, things <#36#>are<#36#> what the acting people think they are. (Hayek, 1955, pp. 27--27)
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His paradigm for the social or moral sciences is that society must be understood in terms of men's conscious reflected actions, it being assumed that people are constantly consciously choosing between different possible courses of action. Any collective phenomena must thus be conceived of as the unintended outcome of the decisions of individual conscious actors.

This imposes a fundamental dichotomy between the study of nature and of society, since in dealing with natural phenomena it may be reasonable to suppose that the individual scientist can know all the relevant information, while in the social context this condition cannot possibly be met.