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• Appendix a Critique of Böhm-bawerk’s Reasoning In Support of His Time Preference Theory
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O

Obfuscated. Darkened or cast in the shadow or background; obscured by withholding proper light or emphasis; hence, confused, bewildered or lost sight of.

Objective use-value. The importance attached to a thing because of its technological capacity to produce chemically or physically a desired effect. An example would be the “heating value” or “heating power” of coal.

Obversion. Transformation by logical inference of a proposition into an equivalent negative, contradictory or obverse proposition, as by inferring from the proposition, “all dogs have heads,” that “no dogs are headless.”

Oligarchy. Rule by a few or a small exclusive group.

Oligopoly, oligopolist. Literally, few sellers; a market situation in which a few individuals or business organizations own or control the total supply of a given commodity or service. An oligopolist is one of the few who own or control such a total supply.

Omnipotence. The state or quality of being almighty, all powerful, irresistible, able to overcome all opposition to the actor’s will, including that of natural laws.

Omnipresent. Present everywhere at the same time.

Omniscience. The state or quality of knowing everything. Omniscience is forever denied to human beings.

Ontological facts. The laws of the universe—physical, biological and praxeological (relating to human action)—to which acting men must submit if they wish to succeed. Mises explained (Human Action, p. 761) that, as a result of these laws, there prevails in the universe an inexorable interconnectedness or regularity of physical, biological, and praxeological phenomena which impose real obstacles to the freedom of men to attain their ends. For instance:

Gravity is an ontological fact, an obstacle imposed by a scientific law of physics, which restricts the freedom of men to leap, to fly through the air, or to stop a fall from a cliff or a high building in mid-passage.

Interest: Interest is an ontological fact imposed by the scientific law of praxeology that individuals value present goods over future goods. Hence, other things being equal, people must pay, and are willing to pay, more to have goods now rather than later. (Human Action, p. 526) Interest is an obstacle in the path of all who seek immediate satisfaction through the market. Interest even restricts the freedom of government to inflate or expand credit for its own spending, to benefit special groups, and/or to satisfy the “needs of business.”

Market prices are phenomena, ontological facts, determined within narrow margins by the actions and choices of marginal buyers and sellers and of excluded buyers and sellers, acting in compliance with the praxeological laws of subjective value and marginal utility. Market prices, voluntarily arrived at, facilitate sales, promote production, discourage overproduction, and tend to bring supply and demand into balance. But market prices restrict the freedom of would-be buyers to pay less and would-be sellers to charge more. If force or threat of force is used to compel traders to sell below the market or to buy above the market, undesired consequences follow—shortages or surpluses of the controlled commodities and disruption of the market’s checks and balances.

Monetary devaluation— The devaluation which ensues from an inflated national currency is an ontological fact, arising out of the actions and choices of market participants on the basis of the scientific praxeological laws of supply and demand. Devaluation dilutes the value of every existing monetary unit and thus deprives all who own money of purchasing power and freedom to use their assets as they wish.

Ontology. The science of being or reality in the abstract, particularly as related to ideas or theories.

Optimum returns, law of. See “Returns, law of,” of which it is a part.

Ordinal numbers. Regular, orderly numbers, indicating order or succession: 1st, 2nd, 3rd, 4th, etc.; distinguished from Cardinal numbers q.v.

Originary interest. The inherent component of gross or market interest rates which represents the ever fluctuating ratio between the values assigned to want satisfactions in the immediate future and those assigned to want satisfactions in the more distant future. In short, the difference between the present values of present and future goods. In addition to the originary interest component, gross or market interest includes the entrepreneurial component (uncertainty of repayment) and the price premium component (anticipated changes in the future values of the particular goods, including the monetary unit, under consideration).

Orthodox. Sound of opinion; accepted, approved, standardized, conventional, customary.

Oxford (University). Founded early in the twelfth century, Oxford University and its rival, Cambridge University, are the two oldest and most revered universities of Great Britain.