Critical realism and the Austrian paradox

Author: Martin, Adam

Source: Cambridge Journal of Economics, Volume 33, Number 3, 18 May 2009 , pp. 517-530(14)

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Abstract:

Austrian economics provokes mixed reactions among critical realists. It preaches methodological individualism, marginalism, and rational choice while embracing emergence, open processes, and error. The Austrian school stands paradoxically with one foot each in the mainstream marginalist tradition and heterodox social theory. I argue that this paradox can be disentangled by appeal to the fundamental distinction between the logic of choice and the logic of action. I then extend the analysis of the logic of action to the critical realist account of the basic ontology of social structures, arguing that successful retroduction of social structures depends on marginalist insights.

Keywords: Austrian Economics; Critical realism; Social ontology; Heterodox economics; B41; B50; B53

Document Type: Research article

DOI: http://dx.doi.org/10.1093/cje/ben051

Publication date: 2009-05-18

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The Cambridge Journal of Economics, founded in 1977 in the traditions of Marx, Keynes, Kalecki, Joan Robinson and Kaldor, provides a forum for theoretical, applied, policy and methodological research into social and economic issues.