Economics and sociology

Abstract

Organisation theorists tend to see the division between economic and sociological approaches to organisation as a manifestation of wider differences between economics and sociology. Sociologists have attempted to set out the differences between the two disciplines (Hirsch et al., 1990; Swedberg, 1991). Economics is dominated by neoclassical economics, so much so that ‘economics’ is virtually synonymous with neoclassical economics (Bartlett, 1989, p. 18). Sociologists have concentrated on developing a critique of a narrowly defined version of neoclassical microeconomic theory (Swedberg et al., 1990, p. 59), especially the ‘unrealistic and bizarre policy recommendations’ it comes up with (Hirsch et al., 1990, p. 42). Neoclassical economics is a refinement of the classical tradition of economics that developed in Britain during the nineteenth century based on the ideas of Adam Smith, Thomas Robert Malthus and David Ricardo (Galbraith, 1987). The major difference between classical political economy and neoclassical economics is the abandonment of any theory of value and the development of marginalism.