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DOI: 10.1177/095269510101400107
2001 14: 119 History of the Human Sciences
Ralph Schroeder
Weber and economic change

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by Pepe Portillo on July 27, 2014 hhs.sagepub.com Downloaded from by Pepe Portillo on July 27, 2014 hhs.sagepub.com Downloaded from
Weber and economic change
RA L PH SC H ROEDER
Richard Swedberg, Max Weber and the I dea of Economic Sociology.
Princeton, NJ: Princeton University Press, 1998, x + 315 pp.
Swedbergs book is the rst full-length examination of Webers thinking
about economics. The lack of a previous treatment of this topic is surprising
since, as Swedberg points out, Weber was professionally rst and foremost
an economist (172), secondly a legal scholar (a topic that has been covered in
at least two major books), and perhaps only in third place the sociologist who
is most important to us today. His economic thinking is also a sorely
neglected topic because and here I want to go further than Swedberg himself
does he is one of the most important thinkers for helping us to make sense
of contemporary economic change.
I shall try to give an indication of this contemporary relevance in the course
of disagreeing with Swedbergs interpretation of Weber. And before quar-
relling with his interpretation, I should say that Swedbergs book is excellent:
he is extremely clear, taking us from Webers account of the rise of capital-
ism, through his basic concepts, to the relation between the economy and
politics, law and religion, and concluding with his relation to contemporary
economic thought (this is almost a summary of the chapter headings).
Throughout, he provides a wealth of detail on the sources of Webers thought
in the controversies of his time and about how Webers ideas developed over
the course of his lifetime, and he systematically lays out his key insights and
arguments. One indication of how good the book is: the notes, which make
up a third of the book, should not be missed; for those who are familiar with
Weber, they yield fascinating asides about the inuences on Webers ideas and
the development of his thought.
H I STORY OF TH E H U MA N SC I EN C ES Vol . 14 N o.1
2001 SAGE Publications (London, Thousand Oaks, CA and New Delhi) pp. 119123
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My two quarrels with Swedberg go right to the heart of how Weber under-
stood economic life and they concern the architecture of Webers thought.
The rst is about social action. Swedberg accepts the view that Weber puts
forward at the outset of Economy and Society; that, in Swedbergs words
(though Weber uses much the same formulation), the basic unit in sociology
is the individual, or more precisely, the social actions of the individual (23).
This means that economic action is basically individual action oriented to
others and it is mainly, though not exclusively, to do with material interests.
Yet, as Swedberg surely knows, there is an extensive debate about the
importance of focusing on individual social action (and here I am talking
just about the literature on Weber; in the social sciences generally, of course,
the literature is enormous). I n interpreting Weber, one can take two extreme
standpoints, and I will grotesquely overstate them to make my point: either,
one takes him at his word when he makes his pronouncement about indi-
vidual social action in Economy and Societyand famously goes on to distin-
guish between the three types of social action in this case, Weber can be
claimed for methodological individualism, which is of course of the utmost
relevance to the study of economics or, one can say (and I , for one, would
have no hesitation saying it), that Webers programmatic pronouncements
about sociology being concerned with individual social action are state-
ments that he made in the context of writing a contribution to a general hand-
book in the social sciences which he was editing, and that in his substantive
analyses of social phenomena he is just as holist, determinist, or even struc-
tural-functionalist as any sociologist (or at least those sociologists who are
interested in macro- and comparative-historical sociology; as opposed to
micro-sociology or social interactionism, or those, like Anthony Giddens
and assorted postmodernists, who claim, wrongly to my mind, that there is
a link between our individual self-understandings and major macro-social
transformations). I n the latter case, one should systematically lay out what
Weber has to offer in terms of arguments about large-scale social changes and
compare or measure this in relation to the state-of-the-art in comparative-
historical sociology, where Weber or perhaps one should say, the Weber
team, those mainly building on Webers groundwork and insights still con-
sistently comes out on top.
Obviously the holismindividualism dispute, in relation to Weber or to the
social sciences, will not be settled here, but one point at least is in order since
we are dealing with economics: the discipline of economics, with the excep-
tion of recent hummings-and-hawings about embeddedness and institu-
tionalism (or, further back in the mists of history, the exception of Marxist
economists), remains wedded, as far as the bulk of its knowledge-production
is concerned, to methodological individualism. This has had the result for the
social sciences that the contribution of economic knowledge to social science
is twofold. First, there is a toolkit for practitioners such as MBAs which
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provides useful tips for current management practice (in a wide sense). Here
the aim is to give the captains of the economy and heads of state and of non-
governmental organizations useful tips about what to do. This part of econ-
omics, though it would probably claim to be methodologically individualist
and thus scientic, is no more, and more likely far less, scientic than good
comparative-historical sociology. I t is a practical art; what the contribution
to the advancement of knowledge is in this case is unclear. The second is a
highly mathematical version of economics, which also claims to be method-
ologically individualist and can claim scienticity. But here again, it is not
clear whether there has been a sustained contribution to our social scientic
understanding of the differences between economic systemsand their major
institutional transformations. Some Weberian comments about world-
mastering as opposed to world-rejecting ascetics to categorize these two
approaches might, if there was time for a sociology of the economics pro-
fession, be appropriate here. (The exception here, incidentally, is economic
history, the area which borders most closely on Webers comparative-
historical concerns and where there have been clear advances.)
All this is a way of saying that the peculiar as Weber on one occasion
insightfully calls it rationality of modern society is better understood in
relation to social structures than to individual action, and all the most import-
ant economic thinkers have wrestled with rationality in this broader
context, in spite of their own methodologically individualist protestations,
and of the straitjacket of their discipline. And so it is with the analysis of the
nature of rational individual and economic action in other disciplines,
where anthropologists (Louis Dumont, Ernest Gellner), political scientists
(Mancur Olson, John Rawls), philosophers (Martin Hollis, Jon Elster), and
development economists (Amartya Sen, Albert Hirschman) have allowed us
to recognize that rationality is a complex and many-sided phenomenon.
And again, even those on this list who might champion individualism as a
method of study do so in a way that does not posit any acontextually maxi-
mizing creatures. This understanding of the historically variable and struc-
turally conditioned nature of rationality is also what Weber bequeathed to
us. The best starting-point for getting to grips with Webers ideas about
rationality, incidentally, remains Rogers Brubakers study of Weber, The
Limits of Rationality: An Essay on the Social and Moral Thought of Max
Weber.
The main point here is that Swedberg does not treat Webers ideas outside
of his alleged individual social action framework. He thereby misses much
of what is important, not so much for our understanding of Weber himself,
but how he can be applied to understanding contemporary economic change.
Let me give just one example of what we miss with individual social action:
it is often argued that there is a free market in which individual economic
action governs. But, as Michael Mann points out, though a far broader range
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of goods are now bought and sold, many of the most important ones are not
actually sold as commodities on free markets. None of the three biggest
industries in the US economy, defence, health care and (probably) illicit
drugs, are simply dominated by commodity production (1997: 488). I t is
easy to see why, in these three industries, it would be impossible to identify
individual rational economic behaviour in any straightforward way. Weber at
least would be completely at home in highlighting, like Mann, the great vari-
ability of economic behaviour in different social systems or networks. Mann
also notes, incidentally, in relation to the points made above about the limi-
tations of economic knowledge, that economists now more or less admit that
they have no explanation of the great booms or slumps of the twentieth
century (or at least one that does not depend on singular events like great
world wars) (1997: 482).
Let me turn to my second quarrel, which is to do with Swedbergs lack of
elaboration of Webers notion of different spheres of social life in this case,
the economic sphere. Swedberg says that Weber thinks of spheres as not
the same as an institutional arena, but rather some kind of existential arena,
perhaps a distinct and meaningful department of life (209, note 6). We should
note the connection with what has just been said about social action, since
Webers sociology is often said, in Parsons (in my view mis-) interpretation,
for example, to be about the individuals meaningful actions. Swedberg is
right in pointing to this existential aspect, which Weber discusses most
explicitly in the Zwischenbetrachtung essay (in English: Religious Rejec-
tions of the World and their Directions; 1948: 32359). But Weber also uses
the notion of the spheres of life throughout his writings, and he uses it to
make strong claims about the relations between these spheres on a non-
individual level. I n my view, these claims are much more insightful than
Webers existential musings although they are not unrelated.
Webers view of the implications of the Russian revolution provides an
example. Weber thought that the attempt to impose a political order on the
economic sphere was bound to fail since the logics of the political and econ-
omic spheres diverged; or, to put it in functionalist language, in moderncapi-
talism, there was ongoing differentiation between these spheres. This kind of
analysis requires a comparative-historical account of the relation between
states and markets, and it is difcult to see how these insights could be
achieved in relation to individual economic behaviour. And in analysing the
relations between spheres of life in an institutional way, Weber is, again, at
one with his contemporary descendants among comparative historical soci-
ologists here Mann, Randall Collins, Ernest Gellner, John Hall, W. G.
Runciman and Charles Tilly could be mentioned. Economists, on the other
hand, would of course have a great deal of difculty with the institutional
relations between the economic and the cultural and political spheres.
I n sum, I hope that in my disagreements with Swedbergs book I have also
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given a brief account of the thought-provoking contribution to understand-
ing economic change that he and Weber make. Apart from the general issues
I have raised, the reader will nd an enormously rich set of comparative-
historical concepts in Webers sociology for making sense of markets and
other economic phenomena in todays society, and Swedberg often puts them
together in a more lucid and accessible way than Weber himself does, since
the systematic nature of Webers ideas is often difcult to extract from the
unnished patchwork of his writings. My quarrelsomeness here is simply a
different way of saying that Swedberg could have pressed much harder in
making Webers ideas relevant to shaping the future direction of economic
sociology a eld that Swedberg himself has elsewhere done much to
promote. To this he might, justly, reply, that that was not the aim of the book.
But the wider issue of the present-day relationship between sociology and
economics surely has to be raised in the context of this book: in the past econ-
omists tried to encroach on and take over the social sciences, a move which
was labelled economic imperialism. Swedbergs book is an indication that,
if anything, in the future, the movement should be in the other direction.
REFEREN C ES
Brubaker, Rogers (1984) The Limits of Rationality: An Essay on the Social and Moral
Thought of Max Weber. London: Allen & Unwin.
Mann, Michael (1997) Has Globalization Ended the Rise and Rise of the Nation-
state?, Review of I nternational Political Economy 4(3): 47296.
Weber, Max (1948) From Max Weber: Essays in Sociology. London: Routledge &
Kegan Paul.
BI OG RA PH I C A L N OTE
RALPH SCHROEDER is Professor in the Department of Technology and Society
at Chalmers University in Gothenburg. He is the author of Max Weber and
the Sociology of Culture(1992) and of Possible Worlds: The Social Dynamic
of Virtual Reality Technology (1996). He has recently edited Max Weber,
Democracy and Modernization (1998), which is reviewed in this volume.
Address: Technology and Society, Chalmers University, S-412 96 Gothen-
burg, Sweden. [email: ralsch@mot.chalmers.se]
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