… is from page 160 of Frank Knight‘s 1940 review essay titled “‘What Is Truth’ in Economics?” as this essay is reprinted in Knight’s 1956 collection On the History and Method of Economics (footnote deleted):
The whole subject matter of [human] conduct – interests and motivation – constitutes a different realm of reality from the external world, and this fact gives to its problems a different order of subtlety and complexity than those of the sciences of (unconscious) nature.
The first fact to be recorded is that this realm of reality exists, or “is there.” This fact cannot be proved or argued or “tested.” If anyone denies that men have interests or that “we” have a considerable amount of valid knowledge about them, economics and all its works will simply be to such a person what the world of color is to the blind man. But there would still be one difference; a man who is physically, ocularly blind may still be rated of normal intelligence and in his right mind.
DBx: The subject matter of the social sciences differs fundamentally from that of what Knight calls “the sciences of (unconscious) nature.” Economists and other social scientists ultimately must understand and explain how the phenomena with which they are concerned arise from the subjective and inherently unobservable and unquantifiable mental impressions of individual human beings as they engage with each other in myriad forms of interaction (not the least of which is talking). This understanding requires (among other things) that social scientists understand what is understood by human actors. For example, what do people understand when they encounter market prices? What do human beings understand when they say – and when they hear – “This shirt is mine” or “That land is hers”? What understandings, expectations, and actions occurred to give rise to observed commercial practices? What human purposes are served by the details of contract law? What goes through human minds to enable a relatively small group of human beings to persuade a much larger number of physically stronger (and well-armed) human beings to die for purposes declared by the smaller group to be worthy to die for?
All such understanding requires a deep understanding of human understanding.