Sociology of economics or sociology of economy? theoretical-methodological arguments for sociological economics

This paper makes a proposal for reintroducing sociological or social economics into contemporary economic science. Such a reintroduction is proposed to be substantive, by analyzing the social structuring of the economy, and formal, by including sociological/social economics in the current (JEL) classification system of economic disciplines (code A.15). Both epistemological and ontological arguments can be presented to support the proposal. Epistemological arguments invoke the presence of essential components of sociological economics in the development of economic thought, and ontological arguments stress the role of social factors in economic life. In this paper I present primarily epistemological (theoretical-methodological) arguments for sociological economics, and secondarily ontological ones. I show that the present designation, sociology of economics, is something different from sociological or social economics in that the former refers to economic epistemology (knowledge) and the latter to economic ontology (reality). I conclude that, in addition to a sociology of economic science, we need a sociology of economic life. There is nothing surprising in the habit of economists to invade the sociological field. A major part of their work—practically the whole of what they have to say on institutions and on the…[social] forces which shape economic behavior—inevitably overlaps the sociologist’s preserves. In consequence, a no man’s land or everyman’s land has developed that might conveniently be called economic sociology … [or sociological economics] (Schumpeter 1956:134). The author is grateful to two anonymous referees for their constructive comments on an earlier version of this article.     

Money and the emergence of knowledge in society

This paper deals with money’s epistemic relevance in society. Money presents theoretical difficulties for neoclassical economics, which treats it as a cost-reducing tool, leading to a socially neutral, aseptic view on money. Drawing from complexity and social theory I provide a socio-epistemic rationalization for money’s irreplaceable role. Building upon Ingham’s Money Is a Social Relation, I argue that money generates a new orderly system of complex social relations that in turn engenders knowledge as an emergent social and ontological phenomenon irreducible to the fragmented knowledge held by members of society. I show that ultimately money cannot be separated from economic knowledge and market rationality. This paper provides sociological and ontological accounts for the emergence of knowledge crucial to coordinate societies, thus extending recent explorations of the ontology of money.     

An Epistemological Reflection on Social and Solidarity Economy

Social and Solidarity Economy (SSE) is emerging as life affirming solutions to the global crises through the multiple ways people locally reinvent economic life on the margins of the capitalist system based on values of solidarity, reciprocity and sustainability. Although the SSE builds on a strong foundation of real practices and institutions of economic transformation as the way forward for us, this paper argues that this world of practice is in need of its theory to frame discourses and engage with the bigger picture with confidence as an alternative to the dominant economic paradigm. The author argues that the orthodox economics, with its ontological construct of the homo economicus, Cartesian dichotomy and logical positivist epistemology severely constrains our abilities to understand and appreciate economic alternatives based on ‘other’ rationalities. Hence, there is a need for an epistemological revolution to construct a coherent theoretical framework from the wreckages of the neoclassical economics for the SSE. This paper seeks to outline the basic structure and the key elements of the ontological and the epistemological framework for this ‘science-in-the-making’ as a step to stimulate further debate for a paradigm revolution.     

Reappraising Austrian Economics' Basic Tenets in the Light of Aristotelian Ideas

This paper sustains that reappraising Austrian economics in the light of Aristotelian ideas is not only possible but also fruitful. First, I draw a sketch of the essential features of Austrian economics. Next, I argue about the necessity for a thorough analysis of the notion of freedom, and I analyze Mises' conception. Next, I expose Aristotle's social, epistemological and economic thought related to Austrian main traits. An account of how the exercise of Aristotelian virtues may be synergic with economic coordination and a sketch of the consequences of the proposal on the teaching of economics are then provided. Finally, the conclusion shortly sums up the content and relevance of Aristotle's contribution.     

Methodological interactionism: Theory and application to the firm and to the building of trust

Recent insights from the “embodied cognition” perspective in cognitive science, supported by neural research, provide a basis for a “methodological interactionism” that transcends both the methodological individualism of economics and the methodological collectivism of (some) sociology and is consistent with insights from social psychology. It connects with a Mengerian exchange perspective and Hayekian view of dispersed knowledge from Austrian economics. It provides a basis for a new, unified social science that integrates elements from economics, sociology, social psychology, and cognitive science. This paper discusses the roots of this perspective, in theory of cognition and meaning, and illustrates its application in a summary of a social–cognitive theory of the firm and an analysis of processes by which trust is built up and broken down.     

Commodity Prices and the New Inflation

The intention of the article is to explore trends in economics and sociology, as well as other science disciplines, like history, psychology and anthropology, and investigate the interdisciplinary exchanges that have taken place, leading to convergences and divergences between academic subjects. The “imperialism of economics” is increasingly approaching traditional academic fields of history, psychology, and sociology. However, the article concludes that sociology’s public reputation may have declined, while simultaneously economics is shifting its attention to the social dimension of economic behavior and moving toward the other social sciences; a process which has been coined “social-scienciation.” The argument is that those developments can also be seen as chances to upgrade the social sciences “around” economics. The described process also aligns with recent talk about a need for interdisciplinary studies when this article adopts a different take on the issues of interdisciplinarity and embeddedness.     

Paths of the Weberian–Austrian Interconnection

This paper centers on the theoretical–methodological interconnections between Weber and the Austrian economists. First, the influence of classical Austrian economics, especially Menger and Böhm-Bawerk, on Weber is reexamined. Then we are concerned with the importance of Weber's ideas in neoclassical Austrian economics, including Schumpeter, Mises and Hayek. Also, Weber's legacy in modern economics is reconsidered. Since little research is done on these interconnections between Weber's sociology and Austrian economics, the paper thereby contributes toward spanning a gap in the present economic and sociological literature.     

The Case For Strategic Realism: A Response To Lawson

Tony Lawson makes a compelling case that it is only naive realism that feminist social scientists and philosophers need to avoid, not any and all realist arguments. However, he leaves mysterious, on the one hand, why so many feminists have preferred epistemological to ontological arguments and, on the other hand, why naive realism, which is indeed problematic, can appear to be a good scientific/epistemic strategy. The essay below tries to demystify these phenomena, notes a possible misleading aspect of his use of the term "epistemological relativism", and argues for a somewhat more limited value of the ontological argument he proposes for standpoint epistemologies.     

The economics of ageing and the political economy of old age

Economic discussion of ageing has been largely neoclassical in approach. Ageing has become a specialism within population economics, which is itself a specialism within the neoclassical mainstream. An alternative view has come from authors in sociology and social policy, who have produced their own ‘political economy of old age’. In contrast with neoclassical individualism, sociological depictions of ageing have stressed the social construction of old age and the structured dependency of the elderly. Non-neoclassical economists have had little to say about ageing, despite some relevant work in the early days of Keynesianism. This paper argues that a combination of structural ideas from sociology and disequilibrium ideas from Keynesian and non-neoclassical economics can provide a suitable framework for the economics of ageing.     

Conceptual Displacement: From the Natural to the Social

This paper distinguishes between epistemological naturalism, which it supports, and ontological naturalism, which it opposes. It sketches the emergence of anti-naturalist social theory among nineteenth-century African-American intellectuals and its refinement by twentieth-century feminists. These movements challenged ontological naturalism in the social sciences by substituting social constructionist concepts of race and gender for naturalist ones. Economics awaits a similar liberation. The paper identifies four naturalist concepts—atomism, determinism and biologically determined race and gender differences—as structuring mainstream economic theory. It concludes that ontological naturalism is inconsistent with the application of the epistemology of the natural sciences to the social sciences.     

Francesco Forte’s Contributions to <Emphasis Type="Italic">Essentials of Fiscal Sociology</Emphasis>

Francesco Forte has made major contributions to many areas of economics with the result that his theoretical work and applications have opened new areas of inquiry. This paper connects Forte’s work with the work of Jürgen Backhaus on fiscal sociology. Positioned at the crossroads of economics and sociology, the answers to these questions helped fill the void which gave rise to the field of fiscal sociology. Fiscal sociology is primarily a study of taxation and fiscal policies which illuminates core issues in the sociology of contemporary capitalism. It includes the causes of poverty and inequality in rich countries and adds to our understanding the basis for the inequality between rich and poor countries. Our paper reviews several of Forte’s papers on Pareto’s fiscal sociology and the failure of European planning for less-developed regions. The paper highlights Forte’s contributions to economic theory focusing on Pareto’s sociological theory and the influence of the European Union on regional development.     

Uncertainty,Rationality and the Study of Social Institutions

The insight that both ontological and epistemological perspectives are intertwined is certainly correct, but at the same time insufficient to differentiate mainstream from heterodox approaches to economic institutions. As this paper argues, it is important whether one starts from ontological or epistemological considerations first. The paper suggests that the difference can be described in terms of function versus rules and demonstrates that an intersubjective ontology for institutions requires also an intersubjective epistemology. Otherwise, ontological precepts contradict the epistemological ones with important repercussions for understanding knowledge, rationality and institutions.     

Critical Realism as a Basis for Economic Methodology: A critique

This paper considers the claim that critical realism provides a convincing critique of mainstream economics and offers a sound methodological basis for an alternative approach. It argues that critical realism presents a tendentious definition of positivism and a characterisation of mainstream economics that is misleading, and that it misrepresents the nature and purpose of the work of Hume and modern Humean philosophers. It also argues that critical realism's bold ontological claims lack epistemological support. The paper concludes that critical realism does not provide a compelling basis for economic methodology.     

Social indicators and comparisons of living standards

Construction of an international index of standards of living, incorporating social indicators and economic output, typically involves scaling and weighting procedures that lack welfare-economic foundations. Revealed preference axioms can be used to make quality-of-life comparisons if we can estimate the representative household's production technology for the social indicators. This method is applied to comparisons of gross domestic product (GDP) and life expectancy for 58 countries. Neither GDP rankings, nor the rankings of the Human Development Index (HDI), are consistent with the partial ordering of revealed preference. A method of constructing a utility-consistent index incorporating both consumption and life expectancy is suggested.     

Foucault on the Marginal Revolution in Economics: Language and the Cartesian Legacy

Scholars have long debated the ‘revolutionary’ character of the ‘Marginal Revolution’ in economics, focusing on theoretical foundations, methodological devices, social context and political aspects. This article offers a new perspective by investigating ontological and epistemological conditions of that intellectual movement. This requires, in turn, a characterization of those conditions, for which purpose we will draw on Foucault's configurations of thought into ‘epistemes’ in The Order of Things. Although not mentioning those conditions, there have been few references in economics to Foucault's approach. They have mainly claimed that he neglected its importance because he did not see it as a ‘revolution’ in The Order of Things. It is argued here that he actually considered it a ‘revolution’ in The Archaeology of Knowledge. A revision of Foucault's account provides some ideas regarding deep philosophical conditions of the emergence of neoclassical theory and defies some usual interpretations of the circumstances that led to the mathematization of economics. The main conclusion is that its revolutionary character did not stem from a change of ontological beliefs, but—just as many historians of economics have defended—it was a methodological revolution. This study suggests a reinterpretation of that event, claiming that it resulted from a new conception of language and a crisis of Descartes's project of a mathematical unifying science. Going beyond that debate, these reflections proffer ideas that deserve an appraisal in economics.     

Political markets? Politics and economics in the emergence of markets for biodiversity offsets

This paper analyses the relationship between politics and performativity of economics in the emergence of markets for biodiversity offsets. While the role of economics in constructing markets has been demonstrated by sociology and social studies of science, it has also become apparent that politics plays an important role in the material outcome of economic experiments. Two case studies of the creation of markets for biodiversity offsets are analysed, in the United States and England. The findings suggest that the creation of both markets is rooted in the language, concepts and models of economics. Politics, on the other hand, functions as a mediator of the material expression of those models. Through this mediation effect, similar economic models are performed differently, resulting in a variety of markets. This suggests that the material outcomes of processes of market creation are not defined at the outset, but can be influenced by political processes.     

Trade Unions Face a New Western Capitalist Society

Nicholas Georgescu-Roegen was hostile to work in economic theory that is based on the notion of a continuum of agents. In this essay, I use this hostility as a point of departure for an exploration of his views concerning representation, language and theory as they pertain to what he saw as economic science. In particular, I view his methodological stance to the "doing of economics," as expressed primarily in his epistemological writings, in the light of Richard Wollheim's reflections on "art and its objects."     

Theories of practice — New inspiration for ecological economic studies on consumption

The dynamics behind ever-increasing consumption have long been a core issue of ecological economics. Studies on this topic have traditionally drawn not only on insights from economics, but also from such disciplines as sociology, anthropology and psychology. In recent years, a practice theory approach has emerged in sociological consumption studies, as part of a general wave of renewed interest in practice theory emanating from a desire to move beyond such dominant dualisms as the structure-actor opposition in sociology. The purpose of this paper is to introduce the practice theory approach in relation to studies of everyday life, domestic practices and consumption, and to argue that this approach can be fruitful for ecological economics and other fields interested in the environmental aspects of consumption. The paper emphasizes the immense challenge involved in promoting sustainable consumption, and the need for collective efforts supported by research into the co-evolution of domestic practices, systems of provision, supply chains and production.     

Institutions and Values: A Methodological Inquiry

Economics entails a study of institutions regardless of the school of thought, and it is inherently an analysis of institutional transformation with a vision toward creating positive social change through economic arrangements. However, the conceptions of institutions, identity of individuals, human nature as it pertains to economics, identification of the economic sphere, its concerns, and studying its evolution, all vary substantively across schools of thought. We examine the following issues: (i) the differences in the ontological identity of the individual between heterodox approaches, new institutional economics (NIE), and the neoclassical school; (ii) the central point of divergence between original institutional economics (OIE) and NIE, despite both schools being committed to the project of an “institutionally” centered approach to economics; and (iii) the absence of a cohesive project to explore foundational theoretical congruencies among those heterodox approaches that have a shared vision, values, and a common ontological identity of socially embedded people.     

The Scope and Promising Future of Social Economics1

This essay explores the future potential for Social Economics. Since the beginning of modern economics, the mainstream has been steered by what might be called a material progress vision, whereby the generally unacknowledged pesumption is that economic growth will make the good life possible. Accordingly, such potential components of human welfare as more creative and fulfilling work, greater equality in the distribution of opportunity, wealth and income, and a greater degree of community can be more or less ignored for the present. Less guided by this vision, and unfettered by a pretense of value-neutrality, Social Economics does not view such components of welfare as subsidiary to economic growth. Instead, it is more focused upon the wholeness of social life, more concerned with the full requisites of the good and just society. By drawing upon recent work in psychology, sociology, and especially happiness research, Social Economics is found to offer a more promising orientation towards future economic concerns than does mainstream economics.