How Weber overcame the problems of neoclassical economics. The continuing relevance of his analysis in the neoliberal context

Abstract

The rational choice turn in neoclassical economics sought the authority of Weberian methodology but failed to heed its warnings. Its ambition to shape a science that would arbitrate the public good eventually broke down, and all that survived in the ensuing ideological debate was neoliberal dogma. While Weber saw the benefits of neoclassical economics, his methodology followed a different path in the construction of an ideal-type of the modern capitalist enterprise. This becomes a tool of political economic analysis that establishes an ‘institutional context of accumulation’ on which to base analysis of formal rationality, the results of which inform the path to be taken by the sub-discipline of an evaluative ‘critical economics’. The actualization of neoliberal dogma in a new social order in the 1970s and the particular form of monopolistic rentier capitalism its imperial structure takes, facilitate a new ‘rentier politics’ that gives Weber's construction acute analytical relevance.