Methodological individualism
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In the
social science Social science is one of the branches of science, devoted to the study of societies and the relationships among individuals within those societies. The term was formerly used to refer to the field of sociology, the original "science of soc ...
s, methodological individualism is the principle that subjective individual motivation explains social phenomena, rather than class or group dynamics which are illusory or artificial and therefore cannot truly explain market or social phenomena. This concept was introduced as an assumption in the social sciences by
Max Weber Maximilian Karl Emil Weber (; ; 21 April 186414 June 1920) was a German sociologist, historian, jurist and political economist, who is regarded as among the most important theorists of the development of modern Western society. His ideas profo ...
, and discussed in his book ''
Economy and Society ''Economy and Society: An Outline of Interpretive Sociology'' (1921; ; or simply ''Economy and Society'') is a book by political economist and sociologist Max Weber, published posthumously in Germany by his wife Marianne. Alongside ''The Prote ...
''. Methodological individualism is often contrasted with methodological holism and
methodological pluralism __notoc__ Epistemological pluralism is a term used in philosophy, economics, and virtually any field of study to refer to different ways of knowing things, different epistemological methodologies for attaining a fuller description of a particular f ...
.


In economics

In
neoclassical economics Neoclassical economics is an approach to economics in which the production, consumption and valuation (pricing) of goods and services are observed as driven by the supply and demand model. According to this line of thought, the value of a good ...
, people's behavior is explained in terms of rational choices as constrained by prices and incomes. The neoclassical economist accepts individuals' preferences as given.
Gary Becker Gary Stanley Becker (; December 2, 1930 – May 3, 2014) was an American economist who received the 1992 Nobel Memorial Prize in Economic Sciences. He was a professor of economics and sociology at the University of Chicago, and was a leader of ...
and
George Stigler George Joseph Stigler (; January 17, 1911 – December 1, 1991) was an American economist. He was the 1982 laureate in Nobel Memorial Prize in Economic Sciences and is considered a key leader of the Chicago school of economics. Early life and ...
provide a forceful statement of this view: :On the traditional view, an explanation of economic phenomena that reaches a difference in tastes between people or times is the terminus of the argument: the problem is abandoned at this point to whoever studies and explains tastes (psychologists? anthropologists? phrenologists? sociobiologists?). On our preferred interpretation, one never reaches this impasse: the economist continues to search for differences in prices or incomes to explain any differences or changes in behavior.


Criticisms

Economist
Mark Blaug Mark Blaug FBA (; 3 April 1927 – 18 November 2011) was a Dutch-born British economist (naturalised in 1982), who covered a broad range of topics during his long career. He was married to Ruth Towse. Life and work Blaug was born on 3 April ...
has criticized over-reliance on methodological individualism in economics, saying that "it is helpful to note what methodological individualism strictly interpreted ..would imply for economics. In effect, it would rule out all macroeconomic propositions that cannot be reduced to microeconomic ones ..this amounts to saying goodbye to almost the whole of received macroeconomics. There must be something wrong with a methodological principle that has such devastating implications". Similarly, the economist Alan Kirman has critiqued
general equilibrium theory In economics, general equilibrium theory attempts to explain the behavior of supply, demand, and prices in a whole economy with several or many interacting markets, by seeking to prove that the interaction of demand and supply will result in an ov ...
and
modern economics Economics () is the social science that studies the production, distribution, and consumption of goods and services. Economics focuses on the behaviour and interactions of economic agents and how economies work. Microeconomics analyzes ...
for its "fundamentally individualistic approach to constructing economic models", and showed that an individualist
competitive equilibrium Competitive equilibrium (also called: Walrasian equilibrium) is a concept of economic equilibrium introduced by Kenneth Arrow and Gérard Debreu in 1951 appropriate for the analysis of commodity markets with flexible prices and many traders, and s ...
is not necessarily stable or unique. However, stability and uniqueness can be achieved if aggregate variables are added, and as a result he argued "the idea that we should start at the level of the isolated individual is one which we may well have to abandon".


See also

*
Austrian School The Austrian School is a heterodox school of economic thought that advocates strict adherence to methodological individualism, the concept that social phenomena result exclusively from the motivations and actions of individuals. Austrian school ...
*
Praxeology In philosophy, praxeology or praxiology (; ) is the theory of human action, based on the notion that humans engage in purposeful behavior, contrary to reflexive behavior and other unintentional behavior. French social philosopher Alfred Espinas ...


References


Further reading

* Agassi, Joseph
"Methodological individualism."
The British journal of sociology 11.3 (1960): 244-270. * Kenneth J. Arrow (1994), "Methodological Individualism and Social Knowledge," ''American Economic Review'', 84(2)
pp. 1–9
* Kaushik Basu (2008), "Methodological Individualism," ''
The New Palgrave Dictionary of Economics ''The New Palgrave Dictionary of Economics'' (2018), 3rd ed., is a twenty-volume reference work on economics published by Palgrave Macmillan. It contains around 3,000 entries, including many classic essays from the original Inglis Palgrave Diction ...
'', 2nd Edition, New York : Palgrave Macmillan
Abstract.
* Brian Epstein (2009), "Ontological Individualism Reconsidered," ''Synthese'' 166(1), pp. 187–213. *
Friedrich A. Hayek Friedrich August von Hayek ( , ; 8 May 189923 March 1992), often referred to by his initials F. A. Hayek, was an Austrian–British economist, legal theorist and philosopher who is best known for his defense of classical liberalism. Hayek ...
(1948), '' Individualism and Economic Order''.
University of Chicago Press The University of Chicago Press is the largest and one of the oldest university presses in the United States. It is operated by the University of Chicago and publishes a wide variety of academic titles, including ''The Chicago Manual of Style'', ...
. *
Geoffrey Hodgson Geoffrey Martin Hodgson (born 28 July 1946, Watford) is Emeritus Professor in Management at the London campus of Loughborough University, and also the editor-in-chief of the ''Journal of Institutional Economics.'' Hodgson is recognised as one o ...
, (2007) "Meanings of Methodological Individualism", ''Journal of Economic Methodology'' 14(2), June, pp. 211–226. * Harold Kincaid (2008), "Individualism versus Holism," ''The New Palgrave Dictionary of Economics'', 2nd Edition, New York: Palgrave Macmillan
Abstract.
* Steven Lukes (1968), "Methodological Individualism Reconsidered," ''British Journal of Sociology'' 19, pp. 119–29. *
Ludwig von Mises Ludwig Heinrich Edler von Mises (; 29 September 1881 – 10 October 1973) was an Austrian School economist, historian, logician, and Sociology, sociologist. Mises wrote and lectured extensively on the societal contributions of classical liberali ...
, "The Principle of Methodological Individualism", chapt. 2 in ''
Human Action ''Human Action: A Treatise on Economics'' is a work by the Austrian economist and philosopher Ludwig von Mises. Widely considered Mises' ''magnum opus'', it presents the case for laissez-faire capitalism based on praxeology, his method to under ...
''
Eprint
*
Joseph Schumpeter Joseph Alois Schumpeter (; February 8, 1883 – January 8, 1950) was an Austrian-born political economist. He served briefly as Finance Minister of German-Austria in 1919. In 1932, he emigrated to the United States to become a professor at Ha ...
(1909), "On the Concept of Social Value", ''Quarterly Journal of Economics'', 23(2), February, pp. 213–32. * Lars Udéhn (2002), "The Changing Face of Methodological Individualism", ''Annual Review of Sociology'', 28, pp. 479–507.


External links

{{DEFAULTSORT:Methodological Individualism Reductionism Sociological theories Criticisms of economics Individualism Philosophy of social science