Skip to content

Economics, Situational Analysis, and explaining the money economy in Max Weber


Omar Kassem

Mainstream economics is the most general case of the study of context bound rationality known as situational analysis, and thus a special case of an economic science which Max Weber views in its entirety. Based on Pareto rationality, mainstream economics does not give an account of the money economy, which is Weber’s aim. Weber’s generic and broad notion of rationality allows for a comprehensive account of money, and results in flows of ideas as individuals interact with their environment reflected in deep social patterns of rationality. One type of this kind of rationality is the ‘formal’ rationality which explains the existence of money and is an expression of the need of the subject individual to keep track of things in a continually changing and complex environment.

1 Arrow Kenneth J., and Debreu Gérard. 1954. ‘Existence of an Equilibrium for a Competitive Economy’. Econometrica 22.3: 265-90. [Crossref]

2 Arrow Kenneth J., and Debreu Gérard. 1974. ‘General Economic Equilibrium: Purpose, Analytic Techniques, Collective Choice’. The American Economic Review 64.3: 253-72. Available at

3 Blaug, Mark. 1986.Great Economists Before Keynes. Cambridge: Cambridge University Press.

4 Bruun H.H. 2001.’Weber on Rickert from Value-Relation to Ideal Type’. Max Weber Studies 1.2: 138-60.

5 Clower, R.W. 1967. ‘A Reconsideration of the Microfoundations of Monetary Theory’. Western Economic Journal 6.1: 1-8. [Crossref]

6 David, Paul. A. 2001.‘Path Dependence, its Critics and the Quest for “Historical economics”’ In Evolution and Path Dependence in Economic Ideas, ed. Garrouste P. and Ioannides S., 15-40 . Cheltenham: Edward Elgar.

7 Debreu, Gérard. 1952.‘A Social Equilibrium Existence Theorem’. Proceedings of the National Academy of Sciences 38: 886–93. [Crossref]

8 Debreu, Gérard. 1959.Theory of Value: An Axiomatic Analysis of Economic Equilibrium. New York: Wiley.

9 Drakopoulos, S.A. 2011. ‘Wicksteed, Robbins and the Emergence of Mainstream Economic Methodology’. Review of Political Economy 23.3: 461–70. [Crossref]

10 Grether, David M., and Plott Charles R.. 1979.‘Economic Theory of Choice and the Preference Reversal Phenomenon’. American Economic Review 69.4: 623-38.

11 Heidelberger, Michael. 2015.‘From Mill via von Kries to Max Weber: Causality, Explanation, and Understanding’. Max Weber Studies 15.1: 13-45. [Crossref]

12 Hicks, John. 1930.‘Edgeworth, Marshall and the “indeterminateness” of wages’. Economic Journal 40.158: 215-31. [Crossref]

13 Hicks, John. 1946 [1939]. Value and Capital: An Inquiry into Some Fundamental Principles of Economic Theory, 2nd edn. Oxford: Clarendon Press.

14 Hicks, J.R., and Allen R.D.G.. 1934a. ‘A Reconsideration of the Theory of Value, Part I by J.R. Hicks’. Economica 1.1: 52-76.

15 Hicks, J.R., and Allen R.D.G.. 1934b. ‘Mathematical Theory of Individual Demand Functions, Part II by R.D.G. Allen’. Economica 1.2: 196-219.

16 Hoppe, Herman. 1997. ‘Certainty and Uncertainty, Or: How Rational Can Our Expectations Be?’ Review of Austrian Economics 10.1: 49-78. [Crossref]

17 Houthakker, H.S. 1950. ‘Revealed Preference and the Utility Function’. Economica 17.66: 159–74. [Crossref]

18 Howson, Susan. 2004.‘The Origins of Lionel Robbins’s Essay on the Nature and Significance of Economic Science’. History of Political Economy 36.3: 413-43. [Crossref]

19 Howson, Susan. 2007. The Making of Robbins’ Essay. Lionel Robbins’s essay on the nature and significance of economic science, 75th anniversary conference proceedings, 431-48.

20 Ingham, Geoffrey. 2004.The Nature of Money. Cambridge: Polity Press. [Crossref]

21 Kalberg, Stephen. 2013.Max Weber’s Comparative-Historical Sociology Today: Major Themes, Mode of Causal Analysis, and Applications. Farnham, UK: Ashgate.

22 Kaldor, Nicholas. 1989.‘John von Neumann a personal recollection’. In John Von Neumann and Modern Economics, ed. Dore Mohamed, Chakravarty Sukhamoy and Goodwin Richard M.. Oxford: Clarendon Press.

23 Keynes, J. M. 1930. A Treatise on Money. London: Macmillan & Co.

24 Knight, Frank. 1921.Risk, Uncertainty and Profit. London: Lund Humphries.

25 Kirman, Alan. 2006.‘Demand Theory and General Equilibrium: From Explanation to Introspection, a Journey down the Wrong Road’. History of Political Economy 38 (suppl. 1): 246-80. [Crossref]

26 Lachmann, Ludwig M. 1982.‘Ludwig von Mises and the Extension of Subjectivism’. In Method, Process, and Austrian Economics: Essays in Honor of Ludwig von Mises, ed. Kirzner Israel, 31-41. Lexington, MA: D.C. Heath.

27 Lakatos, Imre. 1970.‘Falsification and the Methodology of Scientific Research Programmes’. In Criticism and the Growth of Knowledge, ed. Lakatos Imre and Musgrave Alan. Cambridge: Cambridge University Press. [Crossref]

28 Langlois, Richard N. 1984.‘International Organization in a Dynamic Context: Some Theoretical Considerations’. In Communication and Information Economics: New perspectives, ed. Jussawalla M. and Ebenfield H., 23-49. Amsterdam: North-Holland.

29 Langlois, Richard N., and Koppl Roger. 1991.‘Fritz Machlup and Marginalism: a Reevaluation’. Methodus 3.2: 86-102.

30 Langlois, Richard N., and Csontos László. 1993.‘Optimization, Rule-Following, and the Methodology of Situational Analysis’, In Rationality, Institutions and Economic Methodology, ed. Mäki Uskali, Gustafsson Bo and Knudsen Christian, 112-32. London and New York: Routledge. [Crossref]

31 Latsis, S.J. 1972. ‘Situational Determinism in Economics’. British Journal for the Philosophy of Science 23.3: 207-45. [Crossref]

32 Latsis, S.J. 1976. ‘A research programme in economics’. In Method and Appraisal in Economics, ed. Latsis S.J., 1-41. Cambridge: Cambridge University Press. [Crossref]

33 Maas, Harro. 2009.‘Disciplining Boundaries: Robbins’s Essay and the Borderlands of Economics and Psychology’. Journal of the History of Economic Thought 31.4: 500-517. [Crossref]

34 Machlup, Fritz. 1936.‘Why Bother with Methodology’. Economica NS 3: 39-45. [Crossref]

35 Machlup, Fritz. 1955.‘The Problem of Verification in Economics’. The Southern Economic Journal 22.1: 1-21. [Crossref]

36 Menger, Carl. 1871 [2007]. Grundsätze der Volkswirthschaftslehre [Principles of Economics], trans. Dingwall James and Hoselitz Bert F.. Auburn, AL: Ludwig von Mises Institute.

37 Menger, Carl. 1883 [1985]. Untersuchungen über die Methode der Socialwissenschaften und der Politischen Oekonomie insbesondere [Investigations into the Method of the Social Sciences with Special Reference to Economics], trans. Schneider Louis and Nock Francis J.. New York and London: New York University Press.

38 Menger, Karl. 2003.‘Austrian Marginalism and Mathematical Economics’. In Selecta Mathematica, ed. Schweizer B., Sklar A., Sigmund K., Schmetterer L., Gruber P., Hlawka E. and Reich L., 531-53. Vienna: Springer Verlag. [Crossref]

39 Mises. Ludwig von. 1912 [1980]. Theorie des Geldes und der Umlaufsmittel [Theory of Money and Credit], trans. Baston H.E.. Indianapolis IN: Liberty Fund.

40 Mises. Ludwig von. 1920 [1990]. Die Wirtschaftsrechnung im sozialistischen Gemeinwesen [Economic Calculation in the Socialist Commonwealth], trans. Adler S.. Auburn, AL: Mises Institute.

41 Mises. Ludwig von. 1922 [1951]. Die Gemeinwirtschaft: Untersuchungen über den Sozialismus [Socialism: An Economic and Sociological Analysis], trans. Kahane J.. New Haven: Yale University Press.

42 Mises. Ludwig von. 1928.‘Bemerkungen zum Grundproblem der sübjektivistischen Wertlehre’. Archiv für Sozialwissenschaften und Sozialpolitik 59.1: 32-47. In Mises 2003: 177-98.

43 Mises. Ludwig von. 1929.‘Soziologie und Geschichte’. Archiv für Sozialwissenschaften und Sozialpolitik 61.3: 465-511. In Mises 2003: 71-136.

44 Mises. Ludwig von. 1949.Human Action. New Haven: Yale University Press.

45 Mises. Ludwig von. 2003.Epistemological Problems of Economics, 3rd edition, ed. Guido Hülsmann Jörg, trans. George Reisman. Auburn, AL: Ludwig von Mises Institute.

46 Nee, Victor 2002. ‘Sources of the New Institutionalism’. In The New Institutionalism in Sociology, ed. Brinton Mary C. and Nee Victor, 1-16. Stanford CA: Stanford University Press.

47 O’Brien, D.P. 1990.‘Lionel Robbins and the Austrian Connection’. In Carl Menger and His Legacy in Economics, ed. Caldwell Bruce J., 155-84. Durham, NC: Duke University Press: History of Political Economy 22 (supplement).

48 Pareto, Vilfredo. 1906.Manuale di economia politica con una introduzione alla scienza sociale. Milano: Società Editrice Libraria.

49 Pareto, Vilfredo. 1909.Manuel d’économie politique, trans. Bonnet Alfred. Paris: V Girard and E Brière.

50 Plott, Charles R. 1986.‘Rational Choice in Experimental Markets’. The Journal of Business 59.4: Part 2, The Behavioral Foundations of Economic Theory: S301-S327. [Crossref]

51 Popper, Karl R. 1944–45. ‘The Poverty of Historicism I’. Economica 11.42: 86-103; II, 11.43: 119-37; III, 12.46: 69-89. Reprinted as The Poverty of Historicism. London and New York: Routledge, 1957.

52 Popper, Karl R. 1945.The Open Society and its Enemies, 2 vols. London: George Routledge & Sons.

53 Popper, Karl R. 1963.‘Models, Instruments and Truth’. In The Myth of the Framework: In Defence of Science and Rationality, ed. Notturno M.A., 154-84. Oxford: Routledge, 1994.

54 Popper, Karl R. 1967.‘The Rationality Principle’. In Popper Selections, ed. Miller David, 357-65. Princeton, NJ: Princeton University Press, 1985.

55 Robbins, Lionel. 1932.An Essay on the Nature & Significance of Economic Science. London: Macmillan & Co.

56 Robbins, Lionel. 1935.An Essay on the Nature & Significance of Economic Science. London: Macmillan & Co., 2nd edn.

57 Robbins, Lionel. 1971.Autobiography of an Economist. London: Macmillan. [Crossref]

58 Samuelson, P.A. 1938. ‘A Note on the Pure Theory of Consumer’s Behaviour’. Economica 5.17: 61–71. [Crossref]

59 Steedman, Ian. 1992.‘Introduction’. In Wicksteed P.H., The Co-ordination of the Laws of Distribution, 3-45. Aldershot: Edward Elgar.

60 Sugden, Robert. 1991.‘Rational Choice: A Survey of Contributions from Economics and Philosophy’. The Economic Journal 101.407: 751-85. [Crossref]

61 Sugden, Robert. 2009.‘Can Economics be Founded on “Indisputable Facts of Experience”?: Lionel Robbins and the Pioneers of Neoclassical Economics’. Economica 76.s1: 857-72. [Crossref]

62 Swedberg, Richard. 1998.Max Weber and the Idea of Economic Sociology. Princeton, NJ: Princeton University Press.

63 Tversky, Amos. 1969.‘Intransitivity of preferences’. Psychological Review 76.1: 31-48. [Crossref]

64 Weber, Max. 1903–1906. ‘Roscher und Knies and the logical problem of historical economics’. In Weber (2012): 3-94.

65 Weber, Max. 1904.‘Objectivity of Social Science and Social Policy’. In Weber (2012): 100-138.

66 Weber, Max. 1905.‘Critical studies in the logic of the social sciences’. In Weber (2012): 139-84.

67 Weber, Max. 1908.‘The theory of marginal utility and the fundamental law of psychophysics’. In Weber (2012): 242-51.

68 Weber, Max. 1913.‘On Some Categories of Interpretive Sociology’. In Weber (2012): 273-301.

69 Weber, Max. 1920.Gesammelte Aufsätze zur Religionssoziologie. Tübingen: J.C.B. Mohr (Paul Siebeck).

70 Weber, Max. 1922.Wirtschaft und Gesellschaft, III Abteilung Grundiss der Sozialokönomik. Tübingen: J.C.B. Mohr (Paul Siebeck).

71 Weber, Max. 1923.‘Wirtschaftsgeschichte’. Trans. Knight Frank H.. 1927.General Economic History. New York: Greenberg

72 Weber, Max. 1946.From Max Weber: Essays in Sociology, ed. and trans. Gerth H.H. and Wright Mills C.. New York: Oxford University Press.

73 Weber, Max. 1968.Economy and Society: an Outline of Interpretive Sociology, ed. and trans. Roth Guenther and Wittich Claus. Berkeley: University of California Press.

74 Weber, Max. 2012.Weber: Collected Methodological Writings, ed. Henrik Bruun Hans and Whimster Sam, trans. Henrik Bruun Hans. Oxford and New York: Routledge.

75 Whimster, Sam. 2007.Understanding Weber. Oxford and New York: Routledge.

76 Wicksteed, Philip H. 1906.‘Review of Pareto’s Manuale di Economia Politica’. Economic Journal 16.64: 553-57. [Crossref]

77 Wicksteed, Philip H. 1910.The Common Sense of Political Economy including a study of the human basis of economic law. London: Macmillan & Co.

78 Wicksteed, Philip H. 1914.‘The Scope and Method of Political Economy’. Presidential Address to Section F of British Association, Birmingham, 1913. Economic Journal 24: 1-23. [Crossref]

79 Wieser, Friedrich von. 1876.‘Über das Verhältnis der Kosten zum Wert’. In Gesammelte Abhandlungen, ed. Hayek F.A., 1929, 377-404. Tübingen: J.C.B. Mohr (Paul Siebeck).

80 Wieser, Friedrich von. 1884.Über den Ursprung und die Hauptgeseztze des wirtschaflichen Wertes. Wien: Alfred Hölder.

81 Wieser, Friedrich von. 1889.Der Natürliche Werth, trans. Christian A. Malloch. 1893.Natural Value. London: Macmillan & Co.

82 Wieser, Friedrich von. 1914.Theorie Der Gesellschaftlichen Wirtschaft, trans. Ford Hinrichs A.. 1928. Social Economics. London: George Allen & Unwin.

83 Wong, Stanley. 2006.The Foundations of Paul Samuelson’s Revealed Preference Theory. London and New York: Routledge. [Crossref]


Export Citation