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. JEL classification: B30, B31. The Weber–Austrian connection (Boettke 1998) is relatively unexplored in the current literature in economics and sociology despite a certain number of studies. In particular, studies explicitly analyzing the relations of Weber to Austrian economics are rare, with some exceptions (Boettke 1998, Lachmann 1971, 1992). More frequent are those studies that deal with these issues in more indirect ways, namely via analyzing the relations of Schutz and the Austrians (Pietrykowski 1996, Prendergast 1986, Wagner 1983; see also on these pages Augier 1999), or as parts of more general analyses of Weber’s work in relation to neoclassical economics and classical sociology (Holton and Turner 1989, Parsons 1947, Swedberg 1998). Of all these studies concerned directly or indirectly with the Weber–Austrian connection, those concentrated on Schumpeter and Weber are most frequent (cf., Swedberg 1991). In retrospect, the focus on the connection between Weber and Schumpeter is not surprising given not only their personal relations, but also their interactions as social scientists, especially the influence of Weber on the young Schumpeter. Notably, Schumpeter was considerably influenced by Max Weber’s attempts at creating a ‘new and broad type of trans-disciplinary economics” (Swedberg 1991:2) as an alternative to theoretical and historical economics, and thus as a resolution to their methodological dispute (Methodenstreit). Schumpeter reportedly borrowed (Swedberg 1991:93) the notions of social economics and economic sociology from Weber. More particularly, Schumpeter’s concept of the sociology of enterprise was an application of Weber’s economic sociology, with the Schumpeterian constructed type of the entrepreneur being a special case of Weberian ideal types. No wonder Schumpeter has been characterized as Weber’s greatest successor in the role of an economic sociologist (Hughes 1977). However, what is less known is the general connection, in theoretical and methodological terms, between Weber and Austrian economics as a whole. In the ensuing we focus on this Weberian–Austrian connection, and treat that between Weber and Schumpeter as one of its