During the 20th century, Murray Rothbard, a prominent economist and philosopher, made important contributions to libertarian philosophy. He thought that rather than being based on capricious laws established by governments or other organizations, economics should be based on ideas drawn from human nature and natural rights.

The philosophical school of positivism, which prioritizes empirical data over theoretical presumptions, is the subject of Rothbard's criticism. Because positivism tends to ignore the fundamental ideas that underpin market dynamics, Rothbard claims that it can result in a misinterpretation of economic laws. He maintained that, just as physics has fundamental laws like gravity, economics also has inherent natural laws.

Think of the economy as a huge river that flows through a landscape that is full of waterfalls and different types of terrain. Ignoring economic principles can have dire consequences, much like ignoring gravity can have disastrous effects on anyone attempting to cross this river, such as falling off cliffs. According to Rothbard, supply and demand are examples of natural economic laws that operate consistently irrespective of human intervention or belief.

According to him, positivism frequently encourages intellectuals to disregard these fundamental laws in favor of developing ad hoc theories based on particular circumstances. Although this strategy might be effective in the short term, it ignores the more general rules that influence market behavior over time. It's similar to building a bridge without taking into account the basic physics and material properties; it might hold up for a while before collapsing under stress.

The significance of comprehending the fundamental ideas that influence economic results is emphasized by Rothbard's criticism. He thought that by establishing economics on natural law, one could more accurately forecast and explain market phenomena, which would improve policymaking and individual financial management.