Max Weber, 1864-1920

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M. Weber

Max Weber is best known as one of the leading scholars and founders of modern sociology, but Weber also accomplished much economic work in the style of the "youngest" German Historical School.

Although Weber and Sombart are often lumped together as part of that generation in German economics, no two men could be less alike. The superficial, fanciful and Kaiser-worshipping Sombart was nothing like the thorough, rational and Kaiser-despising Weber. Nonetheless, while Weber was not completely immune from German nationalism, he was just not the military-imperial jingoist Sombart was.  Weber firmly believed that the Herrenvolk should circumscribe their ambitions.

That personal attitude was reflected in his most famous economic work, The Protestant Ethic and the Spirit of Capitalism (1905). In it, Weber argued that the presumed anti-capitalist Puritanical rhetoric of eschewing earthly acquisitiveness was actually an impetus for that very acquisitiveness. The thesis was novel and well-known. Catholicism, Weber argues, was tolerant towards the acquisition of earthly gain and winked at lavish expenditure, an idea engendered by hierarchical structure of the Church (which required struggling and jockeying for "position") as well as its own tradition of lavish expenditure (the church) and its oft-used earthly powers of forgiveness for sin. This might make one conclude that the Catholic ethic was more predisposed towards capitalism than the Protestant (as others, before and since, have argued).  

But no, replied Weber. It is true that the Protestant doctrines asked men to accept a humbler station and concentrate on mundane tasks and duties and, without a hierarchical church structure, there was no example of upward-mobility, acquisitiveness and expenditure. Yet it was precisely this that engendered the "work-and-save" ethic that gave rise to capitalism. Dedication to and pride in one's work, Weber claimed, is inevitably a highly productive attitude. The Calvinist ethic of "godliness" through the humble dedication to one's beruf (calling/duty/task), meant economic productivity was consequently higher in Protestant communities. In contrast, the upward-mobility that was possible in hierarchical Catholic society meant that a lot of people found themselves in jobs which they saw only as way-stations to higher and better positions - thereby dedicating only a minimal or nominal attention to the given task as finding it either beneath their dignity or certainly not worth resigning to as their end in life. Consequently, Weber concluded, Catholic communities tended to be less productive.

The higher productivity of Protestant communities was coupled with higher thriftiness. The sinfulness of expenditure and lavish display of earthly goods was a notable Protestant principle. So too was it Catholic, but the Catholic Church had been more prepared to forgive these (and other) sins. The Protestant church had no such power and thus the inducement to the faithful to stay modest in consumption was high. Yet the higher productivity of the Protestant essentially meant that they earned more than the Catholic, and yet because they saved more, they essentially accumulated; the Catholic was less productive but spent more.

Thus, Weber concluded, the idea of "capitalist accumulation" was born directly out of the Protestant ethic - not because the Protestant churches and doctrines condoned acquisitiveness as such (quite the contrary), but rather quite inadvertently through its claim to productive dedication to beruf and thriftiness in consumption. The subsequent ethical "legitimization" of capitalist acquisitiveness in later society under the rubric of "greed is good" was simply a distorted statement of what was already a fact. In no sense, claimed Weber, is the capitalist ethic of "greed" the creator of "capitalist society" (however much it might later be a propagator), but, rather, quite the opposite. 

Weber's 1905 thesis (echoed independently by R.H. Tawney) was naturally quickly disputed and has since been more or less discredited as a "complete" theory of the rise of the capitalism.  Whatever the case, it certainly engendered much debate.  

Weber's other main contributions to economics (as well as to social sciences in general) was his work on methodology. There are two aspects to this: his theory of Verstehen, or "Interpretative" Sociology and his theory of positivism.

His Verstehen doctrine is as well-known as it is controversial and debated. His main thesis is that social, economic and historical research can never be fully inductive or descriptive as one must/should/does always approach it with a conceptual apparatus. This apparatus Weber identified as the "Ideal Type". The idea was essentially this: to try to understand a particular economic or social phenomena, one must "interpret" the actions of its participants and not only describe them. But interpretation poses us a problem for we cannot know it other than by trying to classify behavior as belonging to some prior "Ideal Type". Weber gave us four categories of "Ideal Types" of behavior: zweckrational (rational means to rational ends), wertrational (rational means to irrational ends), affektual (guided by emotion) and traditional (guided by custom or habit).

Weber admitted employing "Ideal Types" was an abstraction but claimed it was nonetheless essential if one were to understand any particular social phenomena for, unlike physical phenomena, it involved human behavior which must be understood/interpreted by ideal types. Economists prick up your ears - for here is the methodological justification for the assumption of "rational economic man"!

Weber's work on positivism or rather his controversial belief in "value-free" social science, is also still debated. While his arguments in this respect were not novel, they did signal a complete and forceful break with Schmoller and the "Young" Historical School.

Weber's other contributions to economics were several: these include a (seriously researched) economic history of Roman agrarian society (his 1891 habilitiation), his work on the dual roles of idealism and materialism in the history of capitalism in his Economy and Society (1914), present Weber on his anti-Marxian run. Finally, his thoroughly researched General Economic History (1923) is perhaps the Historical School at its empirical best.

Max Weber's position as an economist has been debated, and indeed, it is generally accepted now that it is in sociology that his impact was greatest. However, he comes at the end of the German Historical School where no such distinctions really existed and thus must be seen as an "economist" in that light.

Major Works of Max Weber

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