> What they don't do, because they generally know better, is discuss group-level actions.

I'll happily google for you, but I feel like you're not even trying. If you would just look over the wiki for game-theory you'd see economics is one of it's main applications.

http://en.wikipedia.org/wiki/Game_theory#Economics_and_busin...

As for economics, there's an entire field called behavioral economics. It's about the impact of the individual psyche on the market place, which also incorporates many aspects of game theory.

http://en.wikipedia.org/wiki/Behavioral_economics#Behavioral...

> Surely personal psychology doesn't discuss how a high school clique acts in response to another high school clique?

Why wouldn't it? http://en.wikipedia.org/wiki/Social_psychology#Interpersonal...

> But this is not real.

Value isn't real? Preference isn't real? Drive isn't real? Help me out here.

> Pretending that these do not exist is not empiricism. It's confirmation bias.

I don't know why you think I don't believe social groups. I only claimed that libertarians don't recognize the "rights" of groups, which is completely different.

>> I'm not claiming individuals don't act differently based on their setting and peers, just that these phenomenas can be observed at the individual level in an empirical fashion.

> Show me. You're claiming to have a lot of empirical evidence. Show me.

http://en.wikipedia.org/wiki/Game_theory#Economics_and_busin...
http://en.wikipedia.org/wiki/Social_psychology#Interpersonal...
http://en.wikipedia.org/wiki/Behavioral_economics#Behavioral...

> To prove that this is a false dichotomy, you have to present a third alternative.

The alternative to "So what's the incorrect statement here" is that I didn't make an incorrect statement. The burden on proof is on you to show that "If this were actually true, then libertarians couldn't say anything useful about groups of people". I've provided numerous examples of how actions can be evaluated at the individual level to predict the outcome of a group in the wikis I've linked to. Even the study of market failure is well in the domain of the micro economist.

http://en.wikipedia.org/wiki/Market_failure

> So what is it? Is libertarianism about some vague antithesis of authoritarianism, or is libertarianism a framework for analyzing human action?

I claimed it's a philosophy about human action. This entails a framework for analyzing action, that also concludes authoritarianism is not compatible with maximizing the satisfaction of the individual's preference -- which would lead to the next topic of discussion which is value theory.

> How about starting from some of your axioms and principles

http://en.wikipedia.org/wiki/Voluntaryism
http://en.wikipedia.org/wiki/Non-aggression_principle
http://en.wikipedia.org/wiki/Natural_rights

> just flat-out explaining it like I'm five?

Treat others the way you want to be treated.

Don't take other people's things that don't belong to you, because you wouldn't want your stuff taken from you. Don't start fights with the other kids, because you wouldn't want them to start a fight with you. If you do start a fight, expect conflict and escalation. If you're bullied, feel free to defend yourself because you're not obligated to be bullied.