Major traditions of economic sociology

Major Traditions of Economic Sociology
Author(s): Richard Swedberg
Source: Annual Review of Sociology, Vol. 17 (1991), pp. 251-276
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Annu. Rev. Sociol. 1991. 17:251-76
Copyright ? 1991 by Annual Reviews Inc. All rights reserved

MAJOR TRADITIONS OF ECONOMIC
SOCIOLOGY
Richard Swedberg
Departmentof Sociology (B-933), University of Stockholm, S-10691, Sweden

KEYWORDS: capitalism,politicaleconomy,market,business,economics

Abstract
Not only sociologists but also economists have made importantcontributions
to economic sociology. Which particularworks by economists are relevantin
this context is indicatedwith the help of Schumpeter'sHistory of Economic
Analysis, a work unique in that it traces not only the history of economic
theory but also that of economic sociology. Three main traditionsappearin
economic sociology, which are still fairly unexplored:the Germantraditionof
Wirtschaftssoziologie(1890-1930), the Frenchtraditionof sociologie e'conomique (1890-1930), and the US traditionof "economy and society" (1950s).
Since the 1970s a revival of interest in economic institutions has occurred
especially in the United States, and a new economic sociology has come into
being. Both economists and sociologists helped to create this new economic
sociology. Economists have developed an approach known as New InstitutionalEconomics. The main idea here is to explain the emergence and
functioning of economic institutions with the help of microeconomics.
Sociologists have developed an approachto economic sociology, sometimes
referredto as the "new sociology of economic life." This approachattemptsto
analyze core economic problems, as opposedto the problemstraditionallyleft
over by the economists for the sociologists to solve. Today's sociologists have
done importantwork, particularlyon the role of networksin the economy, on
the structureof economic organizations, and on the role of culture in economic life. Though some weaknesses hamper both new institutional economics and the new sociology of economic life, they have breathednew life
and vigor into economic sociology.
251
0360-0572/91/0815-0251$02.00

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252

SWEDBERG

INTRODUCTION
Economic sociology is currentlygoing throughsomething of a revival. New
and exciting studies of such topics as marketsand firms are proliferating,and
a numberof sociology departmentshave introducedeconomic sociology into
their curricula.This developmentmakes it imperativeto try to establish what
has already been accomplished and what remains to be done in economic
sociology. In this review essay we argue that there exist several major
traditions of economic sociology, and that economic sociology has an uncommonly rich and diverse backgroundto draw on.
First of all, there are the threemajorattemptsby sociologists themselves to
launcheconomic sociology: (a) the Germantraditionof Wirtschaftssoziologie
with its origin in the HistoricalSchool of Economics and with Weber's work
as its magnificent centerpiece; (b) the French traditionof sociologie &conomique, which has its roots in Saint-Simon's analysis of "industrialsociety"
and which culminated in the work of the DurkheimianSchool in the early
twentieth century; and (c) the attempt by a few sociologists in the United
States in the 1950s (especially Talcott Parsons and Neil Smelser) to bring
"economy and society" closer together. But even though economic sociology
was mainly created by sociologists, it should be noted that economists also
have made importantcontributions.According to Joseph Schumpeter, who
was himself very interested in sociology, it would be a serious mistake to
identify economic sociology exclusively with sociology-it is equally much a
part of economics. As he once phrasedit: "thereis nothing surprisingin the
habit of economists to invade the sociological field. A large part of their
work-practically the whole of what they have to say on institutionsand on
the forces that shape economic behavior-inevitably overlaps the sociologist's preserves. In consequence, a no-man's land or everyman's land has
developed that might convenientlybe called economic sociology" (Schumpeter 1951:134; emphasis added). To give a full pictureof the majortraditions
of economic sociology, we therefore include a section on the economists'
contribution.

Before concludingthis review essay, we shall, finally, take a look at a new
kind of economic sociology in the process of constituting itself today.
Schumpeter'sidea that economic sociology is a meeting place for economists
and sociologists seems confirmedby recent developments, during which we
have seen many interestingcontributionsfrom sociologists (such as Harrison
White and Mark Granovetter)as well as from economists (such as Oliver
Williamson and GaryBecker). Whatthe new traditionin economic sociology
will look like more precisely is, however, not yet clear. There exist, as we
shall see, several competing perspectives, and what happensduring the next
few years will probably be decisive.

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MAJOR TRADITIONS OF ECONOMICSOCIOLOGY

253

THE TRADITION OF ECONOMICSOCIOLOGYAMONG
THE ECONOMISTS
To map out the contributionby the economists to economic sociology is no
doubt a very complex and demandingtask. Not only is there an enormous
amountof materialto go through,but there is also the addeddifficulty of first
specifying what one means by "economic sociology" and then extracting
exactly this material.And dependingon how one defines "economic sociology", one will obviously get different results, something which makes the
whole thing even more problematic.To undertakean enterpriseof this type is
also a researchproject in its own right and not suitable for a review article.
We shall therefore take a short-cut and follow Schumpeter's account of
economic sociology in his massive History of EconomicAnalysis. This work

is unique for our purposesin that it explicitly set itself the task of tracingnot
only the history of economic theory (defined as the analysis of "economic
mechanisms")but also that of economic sociology (defined as the analysis of
"economic institutions"-Schumpeter 1954c:14-21). Unfortunately,Schumpeter's work does not include a section on the institutionalists,and we shall
thereforehave to complementthe History of EconomicAnalysis on this point.
We shall also say a few words about some other economists' contributionsto
economic sociology during the twentieth century.
Schumpeter'sbook on the history of economic analysis is divided into four
parts, all of which cover fairly long time periods. The first part begins, for
example, with the Greeks and ends in 1790; and Schumpeterhere discusses
the contributionsto economic sociology by such people as Aristotle, Cantillon, and Adam Smith. Aristotle, Schumpetersays, looked at slavery, property, and the state, while Cantillon tried to introducethe class struggle into
economic analysis as well as to analyze the role that marketshave played in
the emergenceof the modem city. Schumpeterwas not particularlyimpressed
by Adam Smith's analysis of economic institutions. As a matterof fact, he
clearly preferredthe works by the scholastics, especially their analysis of
property. Adam Smith had in Schumpeter'sopinion unduly exaggeratedthe
importanceof the division of labor. Book III of The Wealthof Nations ("Of
the Different Progressof Opulencein DifferentNations")could have become
a starting point for a "historicalsociology of economic life"; but for some
reason Smith chose not to develop his ideas on this topic (Schumpeter
1954c:186-87).
History of Economic Analysis is particularlyuseful in that it contains an
authoritativediscussion of the contributionsto economic sociology by the
majorEuropeaneconomists duringthe nineteenthand early twentiethcentury.
During the classical period (1790-1870), according to Schumpeter, little
progress was made in economic sociology since most economists took the

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254

SWEDBERG

existing economic institutions for granted. This was especially true for the
British economists, many of whom were strongly influenced by utilitarianism. And in Schumpeter's opinion, utilitarianismhad had a very negative
impact on economic sociology: "As regardseconomic sociology, utilitarianism can only be describedas a complete failure since its rationalisticconception of individual behavior and of social institutions was obviously and
radically wrong" (Schumpeter 1954c:409). The classical economists, for
example, just assumedthat the state must not intervenein the economy. They
also assumed, without any discussion whatsoever, that there should be free
competition. But behind all their assumptionsthere existed a specific reality,
which was not openly acknowledged. By "corporations"the classical economists usually meant medium-sized corporations;to them, the owner and the
manager were always the same person; and so on.
The classical economists also ignored the impact by the nation and by
social class on the economy. It is true, Schumpeterargued,that we can find a
class concept in, for example, Ricardo's work. But Ricardo used class in a
purely theoretical and nonsociological sense. Indeed, one of the great intellectual mistakesof the classics was precisely thatthey had failed to develop
a sociological concept of class: "they did not work out a theory of social
classes, insert it into their economic sociology, and then constructeconomic
categories for use in economic analysis: this procedurewould have required
an awareness of the problems involved from which they were far removed.
Insteadthey took a shortcut: they simply turned,with little modification, the
social groupings that are known to the popular mind into categories of
economic analysis" (Schumpeter 1954c:552).
It is true, Schumpetercontinued, that John StuartMill had tried to analyze
the role of a few economic institutions,such as propertyand inheritance(see
Mill 1987:218-37, 889-96). Schumpeteralso pointedto Mill's famous analysis of the role of tradition in price-setting (Mill 1987:242-48). In the last
analysis, however, Mill always judged institutionsin terms of whether they
favored or impeded a certainideal; and this preventedhim from developing a

sophisticatedeconomic sociology. The only economistduringthis periodwho
was also a good sociologist was Karl Marx, accordingto Schumpeter.Marx
had made two greatcontributionsto economic sociology: his concept of social
class and his theory of how economic factorsinfluencethe social structureand
the social attitudes(what Schumpetercalled Marx's "EconomicInterpretation
of History"). Schumpeter's analysis of Marx on this point may be complementedby the section on "Marxthe Sociologist" in Capitalism, Socialism
and Democracy, which contains a much fuller discussion of Marx's contribution than does the History of Economic Analysis (Schumpeter 1976:9-20).
Schumpeterwas very enthusiasticaboutMarx's economic sociology; he says
at one point that "the so-called Economic Interpretationof History is doubt-

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SOCIOLOGY 255
MAJORTRADITIONS
OF ECONOMIC
less one of the greatest individual achievements of sociology to this day"
(Schumpeter 1976:10). Schumpeter, however, also warns that Marx had
pushed economic theory and economic sociology so close togetherthat they
practically merged. And this was unacceptable to Schumpeter:Economic
theory should deal with economic mechanismsand economic sociology with
the institutionalframework;and these two tasks should be kept separate.
During the thirdperiod which Schumpetercovered in History of Economic
Analysis, 1870-1914, several important discoveries were made. Jevons,
Menger, and Walras invented marginalutility analysis, and their work was
continuedby such outstandingscholarsas Pareto, Wicksell, and Marshall.In
terms of economic sociology, however, these years were a disappointment.
Sociology took great strides forward, but none of this researchwas used by
the majoreconomists who simply took over the institutionalassumptionsfrom

the classical economists. The result was the following: "Nations remained
amorphousagglomerationsof individuals. Social classes were not living and
fighting entities but were mere labels affixed to economic functions (or
functional categories). Nor were the individualsthemselves living and fighting beings: they continued to be mere clotheslines on which to hang propositions of economic logic. And, with improvingvigor of presentation,these
clotheslines stood out even more visibly than they had in the works of the
preceding period" (Schumpeter 1954c:885-87).
It was also duringthe 1870-1914 periodthatAmericaninstitutionalismwas
born. Schumpeterhad originally plannedto include a section in his book on
the three founders of American institutionalism:Thorstein Veblen, Wesley
Clair Mitchell, and John R. Commons. He died, however, before he got
aroundto writing this section; we shall thereforehave to leave Schumpeterat
this point of our overview (see, however, Schumpeter1950). It is often noted
that the three founders of American institutionalismwere quite dissimilar,
both in terms of their interests and in their style of analysis. This is indeed
true:Mitchell was mainly concernedwith finance and business cycles, Commons with law and labor, while Veblen wrote on the most diverse topics such
as the leisure class, the theory of the firm, and ImperialGermany (Veblen
1899, 1904, 1915; Commons 1919-1935, 1924; Mitchell 1941; for Veblen,
see also Dorfman 1934). Still, the institutionalistsdo have certain things in
common which set them apartfrom neoclassical economists and which show
their affinity to economic sociology. There is first of all their attempt to
develop a different and much broader type of economic theory-a theory
which was to include not only economics but also elements from the other
social sciences, such as psychology, history, and sociology. Veblen, Commons, and Mitchell were also very interestedin analyzingchange over time, a
topic which was impossible to handlewith marginalutility theory in the early
twentiethcentury, but which lent itself very nicely to the sociological type of

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256

SWEDBERG

analysis. Their interest in institutionswas to a large extent an outgrowthof
their fascination with change as well as of their attemptto deal with other
units of analysis than those that are commonly used in neoclassical theory.
The institutionalists'critiqueof mainstreameconomic theory was basically
that it was too narrowand individualistic,and unable to deal with empirical
reality. Mitchell, for example, felt thateconomic theorywas a hindranceto an
effective understanding of business cycles. What was needed was a
straightforwardempiricalapproach,as exemplifiedby the work of the National Bureau of Economic Research (which Mitchell helped to found in 1920).
Commons said that economic theory should be able to deal with "collective
economic behavior,"not only with individualeconomic behavior. Economics
would, for example, do well to incorporatethe concept of "transaction"from
legal science and to view economic action as a "process." As Commons
(1924:7) phrased it in The Legal Foundations of Capitalism: "While the
economists startwith a commodity or an individual's feeling towards it, the
court starts with a transaction. Its ultimate unit of investigation is not an
individual but two or more individuals-plaintiff

and defendant.

. .

. The

transactionis two or more wills giving, taking, persuading, coercing, defrauding,commanding,obeying, competing, governing, in a world of scarcity, mechanism and rules of conduct." This concept of transaction is, no
doubt, very close in spiritto economic sociology (it was also to inspire some
of the analysis in Oliver Williamson's Marketsand Hierarchies, 1975). The

most biting critique of marginal utility theory came, however, not from
Commonsor Mitchell but from Veblen, who arguedthatthe neoclassical type
of economic theory failed to incorporatethe latest developmentsin psychology as well as history. As a result, the economic actor was reduced to
something of a caricature.In an oft cited quote by Veblen: "The hedonistic
conception of man is thatof a lightningcalculatorof pleasuresand pains, who
oscillates like a homogenousglobule of desire of happinessunderthe impulse
of stimuli that shift him about the area, but leave him intact" (Veblen
1898:389).
The emphasis on change in the work of the American institutionalistsis
particularlyclear in Veblen's argument that economics must become an
evolutionaryscience. In Veblen's "evolutionaryeconomics," institutionsare
defined as "settled habits of thoughtcommon to the generalityof men," and
this means that they are historicallyformed (Veblen as cited in Gruchy 1947,
p. 68). To Veblen, it was simply inconceivable that one could analyze
economic behavior without taking history into account and the changes that
societies display over time. Commons was basically of the same opinion, as
his massive History of Labor in the United States testifies (Commons 19181935). And so was Mitchell. Indeed, in Business Cycles the past and the
presentare organicallyconnected to one another-"prosperitybreeds crisis,"
to cite a famous line by Mitchell (1941:153). Mitchell's concern with change

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MAJORTRADITIONS
OF ECONOMIC
SOCIOLOGY 257
is also clear from his work as the chairmanof the committee which in 1934
published the famous interdisciplinaryvolume Recent Social Trends (President's Research Committee on Social Trends 1934).
To trace the contributionsby economists to economic sociology from, let

us say, the mid-1930s and onwardsis a complicatedtask. It must first of all be
noted that there was practicallyno communicationbetween economists and
sociologists afterthe triumphof neoclassicaltheoryover the HistoricalSchool
in Europe and over institutionaleconomics in the United States. This means
thatpracticallyall "sociological"work, which was done by economists during
the rest of the twentiethcentury,was producedwithoutany contactwhatsoever with the sociological tradition.At the risk of simplifying things too much,
we can say that economists have followed two different routes in their
attemptsto tackle sociological problemsduringthe years after 1930. There is
first of all the small minorityof economistswho have continuedto work in the
traditionof the original type of institutionalism.They basically explain the
emergence and workings of economic institutions through a very broad
conception of economic theory, which also includes a sociological perspective. This older type of institutionalismhas been kept alive since the 1930s
throughthe works of a small numberof well-known economists such as John
Kenneth Galbraith,GunnarMyrdal and Raoul Prebisch (see e.g. Galbraith
1952, 1955, Myrdal 1957, 1968, Prebish 1962, Samuels 1988). Then there
are those economists who have developed a novel type of institutionalism
known as "new institutionaleconomics." These latterexplain the emergence
and workings of economic institutionsthroughthe principle of maximizing
utility.
The new type of institutionalismhas had much more of a following in
mainstreameconomics. It startedto bloom in the 1970s but can in some sense
trace its intellectual roots to the 1930s, especially to Ronald H. Coase's
classic article "The Nature of the Firm"(1937). Coase here makes an argument that lays the foundationfor transactioncost economics (includingOliver
Williamson's Markets and Hierarchies), namely that the decision to use a
market or, alternatively, a firm, depends on the transactioncosts involved.
Though Coase does not explicitly say that non-economicinstitutionscan also
be explained throughthe principleof maximizing utility, it is clearly only a
short step to this position-a step which, however, would not be taken until
some time after World War II(see e.g. Coase 1960). Though we now leave
new institutionaleconomics, we returnto it later.

THE SOCIOLOGICALTRADITIONSIN ECONOMIC
SOCIOLOGY
Unfortunatelyno sociological equivalent to Schumpeter'sHistory of EconomicAnalysis exists; andthe historyof economic sociology, as developed by

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258

SWEDBERG

sociologists, is still very much virgin territory (but see Swedberg 1987).
Three importantattemptshave been made in mainstreamsociology to create a
viable economic sociology: in Germany, France, and the United States. The
attempts in Germany and France paralleled each other in time but were
nonetheless independent of one another. They both started in the 1890s,
culminatedjust before WorldWar I, and died off in the 1930s. The attemptin
the United States, on the other hand, began first in the 1950s and peteredout
in the 1960s. Each of these three traditionsin economic sociology display a
different profile. They are all fairly unexploredand, more importantly,they
are all relativelyunexploited.This is especially truefor the richestof them all,
the German tradition.

The Tradition of German Economic Sociology (1890-1930)
What characterizesthe Wirtschaftssoziologie,which emerged aroundthe turn
of the century, is first of all that it was profoundlyhistoricaland comparative
in nature. An attemptwas also made in this type of economic sociology to
show that the study of economics belongs to the "culturalsciences," which

basically means that an interpretiveapproachhad to be used. In terms of the
objects it studied, German economic sociology focussed primarily on two
topics: economic development and the role of the state in the economy. In
both areas it left behind magnificent achievements, such as the works by
Weber, Sombart, and Schumpeter.
That Germaneconomic sociology was historicaland comparativein nature
primarilymeans that it drew much of its inspirationfrom historicalresearch
and that it made use of comparisons-comparisons between institutions,
between nations, and between civilizations. The idea that economics is not a
naturalscience but a "culturalscience" and thereforemust deal with culturally
constructedmeanings, came from philosophy, especially Dilthey. According
to Weber (1975:151-52), it was an economist called FriedrichGottl who first
stressedthat Verstehenmust be systematicallyintroducedinto economics. To
avoid any misunderstandings,it should be noted thatwhat people like Weber
and others had in mind was not so much subjective opinions about some
aspect of economic life (as in, say, contemporarysurvey research), but
culturallyconstructedmeanings. These could take the form of institutionsbut
could also be embodied in the "spirit"of a whole economic system. The two
major topics that the German economic sociologists chose to focus oneconomic developmentand the role of the state in the economy (e.g. Hoselitz
1960, Bicher 1968)-were both much related to the problems surrounding
the industrializationof Germany.
German economic sociology owes much of its strengthto the Historical
School in Economics and to Marx' masterfulanalysis in Capital (Marx 1967).
The pioneeer in this whole development, however, was FriedrichList, who

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MAJORTRADITIONS

OF ECONOMIC
SOCIOLOGY 259
introduced the notion of nation into economics in 1841 in The National
Systemof Political Economy. Schumpeter(1954b:100) writes:"Inthis context
List's contributiontowards an economic sociology is of first importance,
[especially-RS] his conception of the naturaleconomy in the setting of its
historicalcauses as the embodimentof historicallyunique circumstances."A
few years later, in 1843, Wilhelm Roscher(1895:101) took the importantstep
of announcingthat economics must use "the historical method." "It will be
seen," he wrote, "thatthis method aims at much the same result for political
economy as the method of Savigny and Eichhorn has attained in jurisprudence"(Roscher 1895:103). Roscher emphasized that a comparative
approachmust be used as partof the historicalmethod. Schmoller(1952:375)
has summarized Roscher's methodology in the following way: "There is
everywhere the same aim and the same method: a number of collective
entities and their characteristicsare comparedand placed side by side. They
are orderedin historical series. The attemptis made to identify the causes of
institutions,which prevailedunderparallelcircumstances.This should lead to
laws of historical development and producebenchmarksfor the appraisalof
economic policies and of old and modern institutions." (For a critique of
Roscher's methodology-especially his idea that it was possible to establish
economic laws-see Weber 1975).
The greatest achievements in historical economics cannot, however, be
attributedto the so-called Older HistoricalSchool (whose three key members
were Roscher, Knies, and Hildebrand). These achievements were instead
produced by Gustav von Schmoller and his followers, who soon became
known as the "younger historical school." In the 1880s Schmoller got
embroiled in a very bitter fight with Carl Menger-the so-called Methodenstreit-which he lost and which has cast a dark shadow on Schmoller's
accomplishmentsever since (see e.g. Bostaph 1976, JITE 1988). As opposed
to what is commonly thought, however, Schmoller was not hostile to economic theory and was exclusively interested in historical details. As
Schumpeter (1926) has pointed out in one of his key essays, written to

rehabilitatethe founder of the Younger Historical School, much of what
Schmoller wrote actually contains a healthy mixture of analytical generality
and historical facts. Indeed, this mixture is also typical of Wirtschaftssoziologie; and, accordingto Schumpeter(1926:181), "Schmoller'swhole lifework was to a large extent devoted to the founding and development of . . .
economic sociology." Schumpeteralso stressed that no other economist had
takenthe task so seriously as Schmollerconcretelyto describeand analyzethe
economic process. Othersmay have proclaimedthis to be their goal, but only
Schmollermade a serious attemptactuallyto carrythis programout. Schmoller gathered statistics and historical documents; he produced specialized
monographsand he tried to synthesize all of his immense knowledge in a

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general treatise, Grundrissder Allgemeinen Wirtschaftslehre(see especially
Schmoller 1900; see also Hintze 1964).
It should be noted that German economic sociology to a large extent
emerged as an attemptto close the gap in the Methodenstreitbetween the
historically and the theoretically oriented economists. The key idea, most
forcefully articulatedby Weber, was thateconomic sociology could serve as a
bridgebetween these two positions by drawingsimultaneouslyon both historical research and on analytical theory. Between 1890 and 1930 this project
attractedsome of the most creative social scientists in Germany, such as Karl
Bticher, Otto Hintze, Joseph A. Schumpeter,George Simmel, and Werner
Sombart. From the very beginning, however, Max Weber was the towering
figure: it was he who inventedthe field of Wirtschaftssozologieand it was he
who made the most importantcontributionsto it.
In contemporarysociology relatively little attentionhas been paid to Weber's economic sociology, apartfrom The ProtestantEthic and the question of

the relationshipbetween economic theoryand Weber's sociology. The debate
on The Protestant Ethic has usually centeredon the question whetherWeber
meant that protestantismhad "caused"capitalismor whether he had a more
subtle interpretationin mind (for a review of the literaturesee e.g. Marshall
1982). And the studies of the relationship between economic theory and
Weber's sociology have very much been preoccupiedwith the influence of
neoclassical theory and/orhistoricaleconomics on Weber's work (e.g. Clarke
1982:186-242; Hennis 1987; Schon 1987; Holton & Turner 1989; but see
Osterhammel1987). Little attention,however, has been directed at Weber's
economic sociology per se (see, however, Parsons 1947, Collins 1986). This
is a greatpity because huge partsof Weber's work containextremelyvaluable
contributionsto economic sociology. Throughouthis career Weber, for example, made studies of such topics as medieval trading corporations, the
stock exchange, the economic history of Antiquity, the Historical School in
Economics, German agriculture,the productivityof industrialworkers, and
the economic ethic of the majorreligions (see especially Weber 1975, 1976,
1978, 1979, 1980, 1988a,b,c).
To outline the main gist of these studies and their relevance for economic
sociology cannotbe done in this overview. Whatmust be mentioned, however, is Weber's attemptto lay a theoreticalfoundationfor economic sociology.
He did this during the last few years of his life, in the text which today is
contained in chapter2 of Economy and Society, "Sociological Categories of
Economic Action" (Weber 1978:63-21 1). When Weberlecturedon this topic
in the late 1910s, however, the students found it far too abstract. Weber
thereforedecided to give a general course in economic history in 1919-1920
in orderto give some "flesh and blood" to his concepts in economic sociology. This course was latertranslatedinto English (by FrankKnight)as General

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MAJOR TRADITIONS OF ECONOMICSOCIOLOGY

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Economic History and represents, together with chapter2 in Economy and
Society, an indispensible guide to Weber's economic sociology (Weber
1981).
Chapter 2 in Economy and Society and in General Economic History
complement one anothernicely and should also be read together. The main
theoretical categories are the same, even if they are presented in different
ways: in a dry, systematic mannerin Economy and Society and as part of a
historical unfolding in General Economic History. Two key themes, present
in both works, are that economic sociology must be interpretive, and that
power plays a key role in the economy. In Economy and Society Weber
(1978:64) stresses that"all 'economic' processes and objects are characterized
as such entirelyby the meaningthey have for humanaction."And in General
Economic History Weber exemplifies this approachby observing: "Thereis
greatdifference between the fact that a Chinese or Japanesepeasantis hungry
and knows the while that the Deity is unfavorableto him or the spirits are
disturbedand consequentlynaturedoes not give rain or sunshine at the right
time, and the fact that the social order itself may be held responsible for the
crisis, even to the poorestlaborer.In the first case, men turnto religion;in the
second, the work of men is held at fault and the laboring man draws the
conclusion that it must be changed" (Weber 1981:292). In Economy and
Society Weber (1978:68) says that the notion of economic power is "indispensible" to economic sociology (the exact term Weber uses is Verfiigungsgewalt or "powersof control and disposal"). According to Weber, a
numberof importanteconomic phenomena-such as profitmaking,consumer
behavior, and so on-can only be understoodif the role of economic power is
properlytaken into account. His analysis also contains many brilliantsociological observationson economic behavior in different civilizations (mainly
China, India, and Europe), on different types of economic ethics (e.g.
"internalethics" versus "externalethics"), and on different economic roles
(e.g. "the alien trader"versus "the residenttrader").It should finally also be

mentioned that both works contain a sophisticated attempt to develop a
sociology of markets.
Many of the themes thatWebertouchedon in his economic sociology were
also discussed by othersocial scientists, who were eitherinfluencedby Weber
or became interestedin them on theirown. The attemptto determinewhat had
"caused"capitalismcharacterizes,for example, WernerSombart'sgiant work
Der moderne Kapitalismus (Sombart 1987). Sombart's work in economic
sociology is marredby the author'seccentric scientific style but is also filled
with flashes of great insight (see e.g. Hintze 1975). In Die drei National6konomien Sombart (1930), for example, made an interesting attempt to
outline the methodology of "an interpretive economics" ("verstehende
Nationalokonomie").The relationshipof the state to the economy plays a key

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role in Germaneconomic sociology and also in Otto Hintze's work, especially
in his fine study of mercantilistpolicy in eighteenthcentury Prussia (Hintze
1987). While Hintze had primarilybeen concernedwith the role of the state in
the constructionof national markets, Schumpetertried to analyze its budget
and its involvement in various imperialist ventures (Schumpeter 1954a,
1971). In Capitalism, Socialism and Democracy one can also find an attempt
by Schumpeter-inspired more by Marx than by Weber-to sketch the
structuralcontradictionsof the capitalist system (Schumpeter 1976). Two
other classics in economic sociology from these years are Karl Btcher's
Industrial Evolukionand Simmel's The Philosophy of Money (Bucher 1968,

Simmel 1978). With its theoryof stages and engaging institutionalistaccount,
Bucher's work was a great success, not only in Germany but also in the
United States. Simmel's work, finally, contains an importantcontributionto
the sociology of money, especially throughits pioneeringanalysis of the role
of trust in the economy (see in this context also Schumpeter 1970).

The Tradition of French Economic Sociology (1890-1930)
There exist many similaritiesbetwen Frencheconomic sociology and German
economic sociology. Both emphasizedthe role of institutionsin the economy,
and both stressedthat the methodof economic sociology must be comparative
and historical. Both also assigned a central place to the cultural-symbolic
dimension:in Germaneconomic sociology, throughthe conceptof Verstehen,
and in Frencheconomic sociology, throughDurkheim'snotion of "collective
representations.""Economicphenomena,"to cite Marcel Mauss (1967:123),
"are not only material phenomena;they are also collective representations
which dictate the attitudes of the members of society towards material objects. " But some importantdifferencesclearly exist between the two traditions
as well. While theorists like Weber, Sombart, and Schumpeterspoke about
"capitalism"and its struggles, the group aroundDurkheimpreferredto talk
about "industrialsociety" and its lack of cohesion. And while in Germanythe
sociologists tried to find a place for economic sociology alongside economic
theory (or at least not in open opposition to the economists), the Durkheimians fought the economists and wanted to replace economic theory with
economic sociology.

These differencesare to a large extentdue to the fact thatGermaneconomic
sociology and French economic sociology come from different intellectual
traditions. While the formergrew out of the HistoricalSchool in Economics
and Marxism, Frencheconomic sociology was primarilyinfluencedby SaintSimon and Comte. Saint-Simon (1966) was the first to analyze "industrial
society;" indeed it was he who coined or at least popularizedthis term. His
portrayalof contemporaryEuropeansociety as in a painful transitionfrom
feudal society to industrialsociety was extremely influential. It inspired, for

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MAJORTRADITIONS
OF ECONOMIC
SOCIOLOGY 263
example, Comte's famous "law of three stages" and Durkheim'sDivision of
Labor in Society with its analysis of modem society as anomic and without
rules to regulatethe economy (Durkheim1964a). To deal with the problemof
industrialsociety, Comte argued, a general theory of society was needed as
opposed to economic theory, which dealt with only one sector of society. His
Cours de Philosophie Positive, a very influential work, contains a scathing
attack on economic theory for being scholastic, ideological, and sterile
(Comte 1869:193-204; see also Maudit 1928). This critiquewas later echoed
by Durkheim, most prominentlyin Rules of Sociological Method but also in
other writings (e.g. Durkheim 1887, 1908, 1964b, 1970; Aimard 1962).
FranqoisSimiand, whom Durkheimappointedto be in charge of the section
on "sociologie economique"in Anne'eSociologique, also made many attacks
on economic theory. "The mathematicaleconomists," as he wrote in La
Me'hodePositive en Science Economique,"do not hesitateto call what they do
for science, even before they have controlled if their hypothetical constructions are supportedby the facts; even if they are not supportedby the
facts; and even if they are contradictedby the facts. It is not too much to say
that this constitutes a methodological scandal since we are dealing with a
science which after all pretends to explain reality" (Simiand 1912:130).
The major French economic sociologists consisted of Durkheim and his
collaborators, first of all Mauss and Simiand but also Halbwachs and the
Bourgin brothers(see e.g. Bourgin 1924, Halbwachs 1940). Durkheimhimself made a suggestive analysis of the origin of the respect for property
(tracingit to fear inspiredby religious taboos), but was otherwise not particularly interestedin economic sociology (Durkheim1983). Marcel Mauss' The

Gift is a brilliantstudy, not only of gift-giving but of exchange in general and
of the role that the economy plays in preindustrialsocieties (Mauss 1969). At
one point Mauss startedto study the origin of money, but he never completed
this work (Mauss 1974; see Simiand 1934 for an elaborationof Mauss's ideas
on this topic). Like Durkheim, Mauss believed that many modem economic
institutionshave their origin in religious behaviorand that economic sociology thereforeneeds to be complementedby anthropologicalresearch.Scattered
throughoutMauss' work one can also find the most interestingcommentson a
variety of economic topics. At one point Mauss, for example, suggests that
money can be seen as a way of "adjusting"the process of production and
consumptionto one another;and at another,that the essence of the economy
consists in "collective waiting" (Mauss 1967:132; 1974:117-18).
FranqoisSimiand is little read today but exerted, interestinglyenough, an
importantinfluence on the Annales School throughhis insistence that social
-science should deal with the long waves of history ratherthan with single,
spectacularevents. Simiand (1932) made this point most forcefully in a giant
statistical study of French salaries between 1790-1930, entitled Le Salaire,

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l'EvolutionSociale et la Monnaie. Simiand'sown brandof economic sociology-which he referred to as "the positive method in economics" (e.g.
Schumpeter 1952, Besnard 1983, Cedronia 1987)-differed radically from
the work of the Annales School, primarily through its insistence that all
subjective elements should be excluded from the analysis. But as Marc Bloch
(1934:30) has noted a propos Simiand: "to only see numbers as 'objective'

would . . . restrict economic sociology in a fatal way." Indeed, some of the

very best works on the economy, which have been producedby the members
of the Annales School, have drawnmore on Durkheim'snotion of "collective
representations"than on Simiand's "positive method"(e.g. see Duby 1974,
Braudel 1985).

The US Tradition of "Economyand Society"
The development of economic sociology in the United States has been quite
differentfrom that in Germanyand France. No vigorous economic sociology
emerged aroundthe turnof the century;and no majorworks on the economy
were producedby the foundingfathersof Americansociology. Indeed, it was
not until the 1950s that a serious attempt was made to launch economic
sociology as a distinct researcharea. And even when this was done, a certain
hesitation was involved: one ratherspoke of "economy and society" than of
"economic sociology" (e.g. Moore 1955, Parsons & Smelser 1956). Why
economic sociology had such difficulty coming into being in the United States
is not clear. One reason was probably the hostility (later replaced by indifference) of the economists. In the 1890s the American economists, for
example, made it clear to the sociologists that they should stay away from
economic topics and exclusively focus on "social"topics, such as marriage,
deviance, and poverty (e.g. Furner 1975). The alienation that many economists felt toward sociology was furtherintensified in the 1940s when mathematicaleconomics became popular,and the last of what was still "social"was
squeezed out of economics.
Several interesting contributions were nevertheless made to economic
sociology during the pre-1950 period. Around the turn of the century there
developed, for example, a lively debate between economists and sociologists
about the relationshipbetween the two sciences (e.g. Giddings 1888, 1895,
Ward 1899). Of the early sociologists, it may also be noted, CharlesHorton
Cooley was interestedin economic topics. Cooley got a PhD in economics in
1894 and his thesis, The Theoryof Transportation,is an imaginativecontribution not only to human ecology but also to economic sociology (Cooley
1930b). What makes Cooley's analyses of economic topics particularlyinsightful is his insistence on the centralityof communicationin the economic

process. The contemporarysociologist has also much to learn from Cooley's
analysis of such topics as the marketandthe process of evaluation(see Cooley
1918, 1930a, 1930b).

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OF ECONOMIC
SOCIOLOGY 265
MAJORTRADITIONS
In mentioningCooley's analysis of transportationit should be addedthat a
steady streamof work on transportationand communicationwas producedin
the social ecology movement in the first half of the twentiethcentury. Some
of this work was carriedout by people connectedto the Chicago School, such
as RobertParkand W. F. Ogburn(see e.g. Park 1950, Ogburn1946). On the
whole, however, the Chicago School did not contributevery much to economic sociology (Swedberg 1987:54-57). There were basically two reasons
for this: the Chicago sociologists were not very interestedin economics, and
they respected the social division of labor between economists and sociologists, which assigned "economic" problems to the economists and "social"
problems to the sociologists (for an exception, see e.g. Ogburn 1964:34960). The Chicago sociologists did, however, make importantcontributionsto
two new subfields in sociology, which are of interestto economic sociology,
namely the sociology of professions and industrial sociology. Everett C.
Hughes practicallycreatedthe formersubfield on his own (see Hughes 1971
as well as his imaginativeanalysis of the real estate business in Hughes 1979).
Industrialsociology, on the other hand, has its origins in the studies by Elton
Mayo and his Harvardassociates of the HawthorneWorks of the Western
Electric Companyin the late 1920s and 1930s (see Roethlisberger& Dickson
1939, Homans 1950). But even if it was Mayo's work thatlaid the foundation
for much laterwork in industrialsociology on productivityand morale, it was
the Chicago sociologists who added the techniqueof participantobservation

as well as the recognitionthat the relationshipbetween workersand management is often conflictual (see e.g. Blumer 1947, Whyte et al 1955).
Anotherperson who made an interestingcontributionto economic sociology during the pre-1950 period was Talcott Parsons. His doctoraldissertation
from 1927 was Der Kapitalismus bei Sombart und Max Weber (Parsons
1927). At the time when Parsons wrote his thesis, he was still an institutionalist. Later, however, he became convinced that institutionalism
representeda dead-end and that neoclassical theory was far superior. In a
series of articles, which culminatedin TheStructureof Social Action, Parsons
argued that while economists look at reality from one particularviewpoint
(that of "alternativeuses of scarce means to the satisfaction of wants"),
sociologists look at it from another viewpoint (that of values or "ultimate
common ends"-Parsons 1934:526-29). Parsons called this new approach
"the analytical factor view," and it representsto a certain extent an early
version of the economy-and-societyperspective(see also e.g. Parsons 1932,
1935).
During the 1950s the debate about economy and society became much
more lively in the United States; and if this were a book ratherthan a review
article, it would have to include discussions of Karl Polanyi's work in
economic anthropology,George Katona'swork in economic psychology, and
Herbert Simon's work in behavioral economics-as well as analyses of

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266

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modernizationtheory and industrialsociology in the 1950s (see e.g. Katona
1951, Polanyi et al 1957, Simon 1957, Schneider 1957, Dalton 1959, Hoselitz 1960). A self-conscious economic sociology made its first appearancein
the United States at this time. The first stirringscame in 1951 when Francis

X. Sutton, a studentof Parsons, and James Duesenberry,a young economist
who had become interestedin sociology throughHans Gerth at Wisconsin,
started to teach a course at Harvardcalled "Sociological Analysis of Economic Behavior"(see e.g. Duesenberry1949, 1950). Sutton soon galvanized
some other economists into action, such as Carl Kaysen, James Tobin, and
Seymour E. Harris. As a result of their cooperative efforts, The American
Business Creed would be publishedin 1956 (see Suttonet al 1956). The basic
thesis of this work is thatthe "creed"or ideology of Americanbusinessmenis
largely a result of the strainin their social role (for a critique, see e.g. Geertz
1973). Parsons' first contributionto this new field came in 1953 when he
delivered the Marshall Lectures in Cambridge(see Parsons, forthcoming).
The thesis of the book that eventuallyresultedfrom these lectures-Economy
and Society, co-writtenwith the young Neil Smelser-differed considerably
from Parsons' earlier "analyticalfactor view" (Parsons & Smelser 1956).
Economic theory, Parsons & Smelser now argued, constituteda special case
of "the general theory of the social system," and the economy itself was seen
as a "subsystem"of its own (for a critiqueof Parsons' economic sociology,
see Pearson 1957 and Gerschenkron1962).
Economy and Society was no immediatesuccess, and Parsonsseems more
or less to have lost interestin economic sociology afterits publication(for his
later work on money as a "generalizedmedium,"see e.g. Ganssmann1988).
Neil Smelser, however, continuedfor some years to work in the new field. In
his thesis, Social Change in the IndustrialRevolution, Smelser drew attention
to the importance of change in the sociological analysis of the economy
(Smelser 1959). In 1963 he also published the first textbook in economic
sociology and in 1965 the first reader (see Smelser 1963, 1965). After that
Smelser turned his attention to other topics.

NEW ECONOMICSOCIOLOGY
During the 1960s the separationbetween economics and sociology in the
United States reached its peak: sociologists were very little interested in

economic topics and economists stayed away from social topics. This artificial division of laborbegan to breakdown in the 1970s; and since thattime, a
tentative dialogue between economists and sociologists has started up (see
e.g. Swedberg 1990). Exactly what the result of this dialogue will be is
not clear. Some economists feel, for example, that certainpartsof economics
can be improved with the help of sociology, while others think that many

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SOCIOLOGY 267
OF ECONOMIC
MAJORTRADITIONS
problemsin sociology can be solved by using an economic approach(see e.g.
Akerlof 1984, Olson 1965, 1982, Becker 1976). Also the sociologists have
their differences. Such scholarsas JamesColemanand Michael Hechteragree
with economists such as GaryBecker and MancurOlson that a rationalchoice
perspective is needed in sociology (e.g. Hechter 1987, Coleman 1990). This
is a propositionthat, for example, Amitai Etzioni has criticizedvery severely
(Etzioni 1988). Some sociologists-perhaps a majority-however, are stimulated by the prospect of a mixture of both economic and sociological perspectives (see e.g. Winship & Rosen 1988, Fligstein & Dauber 1989). This
is, for example, true for the situationin today's labor marketsociology and
stratificationtheory (see e.g. Berg 1981, Farkas & England 1988).
Of all that is happeningin the borderareabetween economics and sociology, two approachesare of particularinterestto economic sociology and can be
said together to constitutea new economic sociology. These two approaches
are sometimes referredto as "new institutionaleconomics"and "new sociology of economic life"; and a few words shall be said abouteach of them. New
institutionaleconomics has basically been developed by economists, although
a few sociologists have also expressed their interest. The key idea is that
microeconomicscan be used to explain social behaviorand social institutions.
In principle, this approachis considerablybroaderthan economic sociology,
but in practice it often deals with this field as defined by Schumpeter

(economic sociology being the analysis of "institutionsthat are relevant to
economic behavior, such as government,property,inheritance,contract, and
so on"-Schumpeter 1954c:21). It must, however, immediatelybe addedthat
new institutionaleconomics has little if anythingin common with American
institutionalismas developed by Veblen, Commons, and Mitchell. As an
intellectualmovement, new institutionaleconomics has its roots in the 1950s,
althoughit did not really come into its own until the 1970s. Between 1950 and
1970 it was tried out on various legal, political and social institutions.In the
1970s, however, some economists also began to propose provocative new
theories of organizational behavior with the help of such concepts as
asymmetricinformation,transactioncosts, and agent-principal(see e.g. Williamson 1975, Barney & Ouchi 1986; for a game theoretical approach, see
Schotter 1981). Each of these theories explains the emergence and/or structure of organizationssomewhat differently. In agency theory the emphasis is
on how the principalcan controlanddirectthe agent, while in transactioncost
economics, it is on how to minimize transactioncosts. Usually, however, all
of these approaches agree that efficiency is central to the choice of one
organizationalform ratherthan another. This sharply distinguishes new institutionaleconomics from the new sociology of economic life, which claims
thatthe notion of efficiency cannotbe used to explainthe existing institutions,
in the economy or elsewhere (e.g. Granovetter1985, Oberschall & Leifer

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1986, Bradach & Eccles 1989, for some self-doubt among the economists,
see e.g. Furubotn& Richter 1989).
Sociologists were considerablyslower thaneconomists in respondingto the

challenge of a new division of laborbetween economics and sociology. While
the term "new institutional economics" became popular in 1975 (through
Oliver E. Williamson's Marketsand Hierarchies), it was not until 1985 that
the term "new sociology of economic life" was first used (by MarkGranovetter at a luncheon roundtablediscussion at the ASA). In 1985 a key article in
the new economic sociology was also published:Mark Granovetter's"Economic Action and Social Structure:The Problemof Embeddedness."True, it
was HarrisonWhite who had given the initial impulse to revive economic
sociology througha series of pioneeringstudies of marketsin the late 1970s
(see White 1981; see also Barber 1977, Stinchcombe 1983). Still, Granovetter's article was immediately recognized as a trendsetterby economists as
well as sociologists. For one thing, the article contained a sophisticatedand
elegant argumentfor the use of networks in the analysis of the economy.
"Networksof social relations,"we read, "penetrateirregularlyand in different
degrees .

.

. different sectors of economic life" (Granovetter 1985:491). The

networksapproachcan help us to understandthe role of trustin the economy
and how economic institutions work in reality, as opposed to in economic
theory. Secondly, Granovetter'sarticle contained a very knowledgable and
sharp critique of new institutionaleconomics. Granovetterbasically argued
that the economists' idea that the existing economic institutionshave come
into being because they representthe most efficient solution, is simplistic and
wrong: "the main thrustof the "new institutionaleconomists"is to deflect the
analysis of institutionsfrom sociological, historical, and legal argumentation
and show instead that they arise as the efficient solution to economic problems. This mission and the pervasivefunctionalismit implies discouragethe
detailed analysis of social structurethat I argue is the key to understanding
how existing institutions arrived at their present state" (Granovetter
1985:505). And, third, Granovetter's article strengthenedconfidence that
sociologists could solve a number of problems that by tradition only the

economists had done work on. As he phrasedit in an interviewfrom aboutthe
same time: "I think that economic sociologists can go in and do wonderful
things today . . . I think that the place to look is the place that sociologists
have typically avoided looking, namely at all those kinds of argumentsand all
those kind of subject mattersthat have been looked at almost exclusively up
till now by economists" (Granovetter1987:19).
Since the early 1980s American sociologists have looked at a number of
economic institutions,such as insurance,finance, transferpricing, the organization of salespeople, and so on (see e.g. Abolafia 1984, Eccles 1985,
Heimer 1985, Baker 1987, Biggart 1989). Interestingwork has also been

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SOCIOLOGY 269
OF ECONOMIC
MAJORTRADITIONS
done on economics as a discourse and on the economic situationin socialist
countries (Nee & Stark 1989, Block 1990). If one were to summarize the
major intellectual innovations in economic sociology during the 1980s one
could say that they have been centeredaroundthree majorthemes or topics:
(a) the role of networks in the economy (especially in markets), (b) the
structureof different economic organizations, and (c) the role of culture in
economic life. Interesting contributionshave no doubt also been made to
areasthatpartiallyoverlapwith economic sociology but which have theirown
distinct traditions.This is particularlytrue for labor marketsociology, which
today is in a very creative stage, and stratificationtheory, which is increasingly turning toward economic insight and approaches (see e.g. the
literature cited in Kalleberg & S0rensen 1979, Gagliani 1987, Farkas &
England 1988, Althauser 1989).
The networkapproachbecame popularat Harvardin the 1970s throughthe

teaching of HarrisonWhite, who was also very interestedin economic topics
(see e.g. White 1970). White's students, however, have been very independent and used the network approach in their own distinct ways.
Granovetter,for example, has analyzedthe role that networksof information
play when people get jobs (Granovetter1974); Michael Schwartzhas looked
at interlocksbetween banks and corporations(e.g. Mintz & Schwartz 1985);
and Robert Eccles has studied buyer-seller interactionsbetween and within
firms (e.g. Eccles 1981; see also Eccles & Crane 1988). Ronald Burt (who is
a student of James Coleman, but influenced by HarrisonWhite as well) has
producedseveral studies of marketsand is currentlyinvolved in developing a
general theory of competition(Burt 1983). The latterwork is centeredaround
the idea that certain individuals("tertiusgaudens")exploit "structuralholes"
in networks (Burt, forthcoming). Other importantnetworks studies include
Donald Palmer's work on "brokenties" and Wayne Baker's analysis of buyers
and sellers in a national securities market (Palmer 1983, Baker 1984).
Some of the sociologists who have studied networks have also been interestedin the structureof economic organizations.This is, for example, true
for Robert Eccles (1981) who has developed the notion of "quasi-firm"(a
network type of relation with a high degree of stability) and Walter Powell
(1985) who has drawn attention to a similar phenomenon, called "hybrid
organizationalarrangements."But other sources of inspirationexist besides
network analysis; quite a few studies in economic sociology have, for example, emerged as a reaction to Williamson's transactioncost-theory and
Chandler's work on the multidivisional firm (e.g. Fligstein 1985, 1990,
Stinchcombe & Heimer 1985, Bradach & Eccles 1989). There also exist
excellent works in industrialsociology and organizationtheory to draw on in
this context (see especially Hirsch 1972, Stinchcombe 1959, 1974).
A few sociologists have also raised the question of the role of culture in

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270

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economic life. This has been done most forcefully by Viviana Zelizer in her
studies of what she calls "the historical interplaybetween humanvalues and
the market" (Zelizer 1983:ix; for a more programmaticstatement on economics and culture, see Zelizer 1988). As of today Zelizer has studied three
topics from this perspective:life insurance,the social value of children, and
special types of money (Zelizer 1983, 1985, 1989). Throughthis focus on
human values and the market, coupled with an interestinguse of qualitative
and historicalmaterial,Zelizer has addeda new and exciting dimensionto the
economic sociology of the 1980s. How far one can go with a cultural
perspective in economic sociology is, however, not clear; and argumentsfor
as well as against relying mainly on a cultural explanation can already be
found (see e.g. Hamilton & Biggart 1988, DiMaggio 1990). That economic
sociologists need to take cultureinto account, and that economic anthropology has much to teach on this accountis, however, obvious (for an overview of
recent economic anthropology, see Orlove 1986).
Most observers would probablyagree that the new sociology of economic
life has breathedvigor and life into a topic that was leading a ratherbleak
existence in the 1960s andthe 1970s. A numberof importantstudies-on new
topics and with the help of new methods-were producedin the 1980s. Yet,
some weaknesses also appearin this new form of economic sociology. For
one thing, sociologists are still somewhat loath to take on traditionaleconomic topics, and as a result we today lack a sophisticated sociology of
money and of markets.Second, far too little comparativework has been done
(see, however, Hamilton & Biggart 1988, Stinchcombe 1983). Third, it is
unclear how to assimilate the insights from such independent intellectual
traditions as world systems theory, institutionaleconomics, feminism, and
neo-marxism(see e.g. the literaturecited in Wallerstein1974-1989, Chirot&
Hall 1982, Swedberg 1987:65-104, Hodgson 1989). And last but not least,
little attempthas been made to mine the riches of economic history, from the

superb German works from the nineteenth century to the studies by the
Annales School of later date. Some of these weaknesses are no doubt due to
the limitations inherentin the conventionalview that economic sociologists
shall only deal with peripheralaspects of the economy and stay in their own
corner of academia. Hopefully, the time will soon come when sociologists
directly challenge this doctrine, attackeconomic topics straighton, and open
up a dialogue not only with economists but also with economic historians.
Finally, it should be emphasizedthat in the last part of this article, which
has been devoted to the most recentdevelopmentsin economic sociology, we
have focussed exclusively on the situation in the United States. There are
some good reasons for this, especially that the two major types of new
economic sociology have developed most forcefully here. Still, it is also true
that much interesting work has been produced in other parts of the world.

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MAJOR TRADITIONSOF ECONOMICSOCIOLOGY

271

Europeaneconomists who are interestedin economic institutions have, for
example, for a long time found a platformin the Journal of Institutionaland
TheoreticalEconomics (JITE), which is publishedin West Germany. And if
we turn to sociologists, it is clear that many interestingEuropeanand Third
World sociologists have been active in InternationalSociological Association's Economy and Society-section (for a sample of this committee's work,
see e.g. Makler, Martinelliand Smelser 1982, Martinelli& Smelser 1990). It
is also true that some of the most creative sociologists in continentalEurope
have been interested in the intersectionof economy and society during the

1980s (see e.g. Boltanski 1982, Boltanski& Thevenot 1987, Luhmann1982,
Bourdieu 1984, 1990). Finally, there is currentlya very strong interest in
economic sociology in EasternEuropeandthe Soviet Union (see e.g. Lengyel
forthcoming). All in all, we can thereforeconclude this overview by saying
that economic sociology has definitely come alive again and that its future
looks bright.
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