Contemporary Austrian Economics and the New Economic Sociology

Contemporary Austrian economics and the new economic sociology have much in common. First, they share intellectual influences, especially Max Weber. Second, they offer similar critiques of neoclassical economics, and both stress the importance of Verstehen. Third, they have complementary conceptions of rational action and of the role of social institutions in shaping rational action. Specifically, these schools agree on a number of key theoretical propositions and empirical approaches, including but not limited to the notions that economic institutions are socially constructed and that actors are neither social automatons nor asocial creatures (actors are embedded). Although there has been some effort to bring the two traditions together because of these similarities between them, more can be done to bring these schools into conversation with each other. This chapter seeks to tease out the connections between the two schools and discuss possible gains from trade between them.