Annurev Soc 28 110601 140938

10 Jun 2002 20:49 AR AR163-19.tex AR163-19.
SGM LaTeX2e(2002/01/18) P1: GJC

10.1146/annurev.soc.28.110601.140938
Annu. Rev. Sociol. 2002. 28:479507

doi: 10.1146/annurev.soc.28.110601.140938
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c 2002 by Annual Reviews. All rights reserved
THE CHANGING FACE OF METHODOLOGICAL

INDIVIDUALISM
Lars Udehn
Department of Social Sciences, Malardalen University, P.O. Box 325, SE-631 05
Access provided by University of California - Irvine on 10/01/17. For personal use only.
Eskilstuna, Sweden; e-mail: lars.udehn@mdh.se

Annu. Rev. Sociol. 2002.28:479-507. Downloaded from www.annualreviews.org
Key Words institutionalism, structuralism, methodology, individualism

Abstract It is common to categorize social scientific theories as either individ-
ualistic or holistic, and to assume that they are opposites. This neat picture is not so
much wrong as too simple. There are different versions of both doctrines, and some
versions combine elements from both. In this article I distinguish a number of versions
of methodological individualism that differ significantly in strength. The main divide is
between strong versions of methodological individualism, which suggest that all social
phenomena should be explained only in terms of individuals and their interaction, and
weak versions of methodological individualism, which also assign an important role
to social institutions and/or social structure in social science explanations.
INTRODUCTION
In the social sciences a small number of never-ending debates involve fundamental
issues. One of the most intense and most long-standing of these debates is that
between methodological individualists and methodological holists. At times it
seemed as if the debate were going to die out, but then, all of a sudden, it flared up
again with renewed strength. One can discern three periods of intense debate over
methodological individualism in the history of the social sciences. The first period
was at the end of the nineteenth century and the beginning of twentieth century.
The second period started after World War II and culminated in the 1950s. The
third period began in the 1980s and has not ended yet. It is closely associated with
the spread of rational choice of theory from economics to the other social sciences.
The reason for the heat that usually accompanies this debate is probably that it
touches upon our most deep-seated beliefs about the nature of the individual and
of society, our knowledge about these, and no doubt, also our ideals of the good
society. The reason the issues involved in the debate seem so difficult to resolve
is probably that they are largely of a philosophical nature. They involve questions
not amenable to direct empirical testing that yields a clear-cut answer. This does
not mean that empirical matters are irrelevant. Even less does it mean that the issue
between individualists and holists is beyond rational argument. There has, however,
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480 UDEHN
been a conspicuous lack of rationality in the debate between representatives of the

two camps: The participants in the debate appear frequently to misunderstand one
another and argue at cross-purposes.
One reason for this is, no doubt, that methodological individualism exists in
a number of different versions, which must be distinguished for rational debate
to be at all possible. It is necessary to know if we have to do with an ontological
thesis about social reality, an epistemological thesis about possible knowledge, or a
strictly methodological principle about the road to knowledge. It is also necessary to
know if methodological individualism is to be understood as a principle concerning
concepts, explanations, or laws. It is, above all, necessary to distinguish between
strong and weak versions of methodological individualism before discussing its

pros and cons and to take a stand in the debate about it.
The main objective of this article is to contribute to increasing clarity about the
nature and intent of methodological individualism. Since I do not believe that there
is one true version of this doctrine, I have tried to identify the different versions
that have been advanced over the years. This article, therefore, takes the form of a
short history of methodological individualism. It is a seriously incomplete history,
to be sure, but I have concentrated on the most influential advocates and hope
that I have identified the most significant versions. Being a sociologist, I have
deliberately biased my story in favor of my own discipline.1
THE THEORY OF THE SOCIAL CONTRACT
The first example of an individualist theory of society in the history of ideas is the
theory of the social contract. This theory goes back to Greek antiquity, where it
was used by the Sophists and by Epicurus to explain the rise of social institutions
and of social order more generally. The theory lay dormant in the Middle Ages but
was revived on a large scale in the sixteenth and seventeenth centuries. Its main
representatives, I believe, were Thomas Hobbes and John Locke, and of these, the
former was most important, at least for social science. Lockes theory of the social
contract was more political and more important for political philosophy.
The point of departure of all theories of the social contract is the state of nature,
and in the case of Hobbes this state is particularly gloomy. It is characterized by a
lack of agriculture, industry, arts, and of society. It is a state of war of each against
all, which leads to continual fear, and the life of man is solitary, poore, nasty,
brutish and short (Hobbes [1651] 1968, p. 186). Small wonder that individuals
want to escape from this situation and introduce more peaceful ways of interaction.
Rational and self-interested as they are, they institute law and enter into a contract
with others in which they promise to abide by laws. This is the original social
contract, but since there is an incentive for each individual to defect, peace can only
1
This article is partly based on a recently published book on methodological individualism
(Udehn 2001), which is less biased in favor of sociology.
METHODOLOGICAL INDIVIDUALISM 481
be achieved by entering into a second contract. In this contract, individuals institute

a sovereign and authorize her/him to make sure that people do abide by the law.
Hobbess theory of the social contract is an early example of a rational choice
explanation of a social phenomenon, and it lends itself easily to game-theoretical
analysis. It is also extremely individualistic, since it explains the rise of civil
society, not just in terms of individuals, but in terms of individuals living in a state
of nature (Peacock 1986, Pizzorno 1991). The most conspicuous feature of the
state of nature is the lack of society and of culture. It is common, therefore, to refer
to individuals in this condition as abstract (Lukes 1973, Ch. 11) or asocial.
There is no question about the aptness of these designations, but they should not
lead us to assume that individuals in the state of nature are also isolated. They are
not, but instead they interact with one another in their own sort of way, that is by
means of fraud and violence. The main characteristic of individuals in the state of
nature is not that they are asocial, but that they lack culture.
It has been suggested that Hobbes was a methodological individualist (Watkins
[1965] 1973, p. 34; Lukes 1968, p. 119; 1973, p. 110), and this is certainly cor-
rect if we intend methodological individualism-in-use.2 His theory of the social
contract stands out as a first paradigm of an individualistic explanation of social
order.
The theory of the social contract in its original form has few adherents today,
at least as a general theory of society, but it has seen an important revival in
political philosophy, and it is still used in many rational choice explanations of the
emergence of social institutions. It is my impression that something like Hobbess
image of social order is what many social scientists understand by methodological
individualism even today.
CLASSICAL ECONOMICS
The theory of the social contract eventually gave way to the idea that most social
phenomena are spontaneously generated and that society is largely a spontaneous
order. This means that social phenomena are not consciously created, but are rather
the unintended consequences of the intentional actions of individual human beings.
The idea of spontaneous order is often associated with the philosophers of
the Scottish Enlightenment, especially David Hume, Adam Ferguson, and Adam
Smith. According to some methodological individualists, these philosophers are
representatives of true individualism, as distinguished from the false individ-
ualism of the theory of the social contract and of utilitarianism (von Hayek [1948]
1972: Ch. 1; see also Infantino 1998). According to others, it is not individualistic
at all, but represents a break with the individualistic theory of society (see, e.g.,
Berry 1997, Ch. 2). I do not know what is true and what is false individualism,
2
By methodological individualism-in-use, I understand a theory, or explanation, which
conforms to the principle of methodological individualism, without this principle being
explicitly stated.
482 UDEHN
but I know that the individualism of the Scottish Enlightenment was very different
from that of the theory of the social contract. It knows nothing of asocial individu-
als in a state of nature. Individuals are seen as sociocultural beings shaped by social
institutions and by the history of society.3 To introduce a term I use later in this
article, I suggest that we may call the individualism of the Scottish Enlightenment
institutional individualism.
Adam Smith is generally considered to have been the founder of economics.
He was at least the founder of classical economics. But if Adam Smith was an
institutional individualist, does this mean that classical economics, as a whole,
shares this feature? The answer is no. Some other classical economists were more
individualistic than was Smith, and this is especially true of the last of them: John
Stuart Mill.
In A System of Logic (1843), Mill argued that all social sciences are based
on laws of mind, or on human nature. It is possible to find empirical laws, or
generalizations, describing large-scale social phenomena, but a causal explana-
tion of these empirical laws requires psychological laws (Mill [184372] 1974,
pp. 879, 907ff.). Because of this, Mill is generally considered to be a psychologi-
cal reductionist and a methodological individualist (see, e.g., Popper [1945] 1966,
pp. 8899). In order to distinguish Mills methodological individualism from other
versions of this doctrine, it is sometimes called psychologistic individualism
(Agassi 1960).
Among recent methodological individualists, George C. Homans is most clearly
inspired by Mill. There is also a similarity between Mill and some advocates of
microfoundations, who share Mills view that macro-theories are typically empir-
ical generalizations in need of causal explanation in terms of individuals and their
interaction.
NEOCLASSICAL ECONOMICS
Neoclassical economics started with the marginalist revolution in the 1870s. It
was then that economics definitely became an individualistic science, explaining
economic phenomena in terms of the subjective evaluations of individual human
beings. Most explicitly individualistic, was the Austrian School of Economics,
which I treat in the next section. No less individualistic was the English utilitarian
tradition originating with Stanley Jevons.4 Most individualistic, however, was the
theory of general equilibrium, which originated with Leon Walras. According to
him, pure economics is a natural science of things, where isolated individuals
respond to impersonal prices. Where the prices themselves come from is a moot
question, which Walras tried to answer by introducing the mythical figure of an
3
This is the reason some trace the origin of the sociological tradition to the Scottish
Enlightenment, rather than to France and Auguste Comte (see, e.g., Swingewood 1970).
4
An exception was Alfred Marshall, who was, I believe, more of an institutional individualist.
auctioneer, but the aim is clearly to rid the economic theory of general equili-
brium of social relations and of all social institutions (see Walras [1874] 1984,
pp. 6573).
The main architects of contemporary general equilibrium theory (GET) are
Kenneth Arrow and Gerard Debreu. In a famous article from 1954, they proved
the existence, if not the uniqueness, of general equilibrium, in a model that con-
forms to Walrass program. It is a strictly individualistic model of actors in a state
of nature (Geanakoplos 1989, p. 57). Arrow, in particular, is explicit about the
methodological individualism of GET.
Each individual is conceived of as acting in the way determined partly by
his psychology and his physical surroundings and partly by the actions of
others . . . Therefore, given the reaction of each individual to his total (social
and other) environment . . . and given the nonsocial environmental factors,
which we may term exogenous, we can determine the behavior of any indi-
vidual in society. (Arrow [1951] 1968, p. 640.)
According to the individualistic framework of GET, then, every relevant variable,
except those classified as exogenous for the whole economic system, is the result
of a decision on the part of some one individual unit of the economy (Arrow
1959, p. 42).
It is obvious that GET represents a radical form of methodological individ-
ualism, where the actions of individuals are seen as resulting from (a) her/his
psychology, (b) the physical surrounding, and (c) the actions of other individuals.
The behavior of the group is explained by aggregating the behavior of individuals.
According to Lawrence Boland (1982, p. 13ff.), not only GET, but also neoclassi-
cal economics as a whole, is a manifestation of psychologistic individualism. The
rule guiding this form of methodological individualism says that no economic ex-
planation is considered successful until all exogenous variables have been reduced
to psychological states of individuals and natural constraints. Social institutions
may appear in the models of neoclassical economics, but only as endogenous
variables.
Neoclassical economics is generally considered the most individualistic of the
social sciences (Hausman 1992, p. 97ff.; Arrow 1994, p. 2). I share this view and
suggest that GET is a second paradigm of methodological individualism.
In recent years, serious doubts have been raised in many quarters about general
equilibrium theory. The main problem is the lack of determinacy of neoclassical
models, and it is assumed, even by some leading economists, that the root of the pro-
blem is methodological individualism (Kirman 1989, Arrow 1994). For a while,
game theory appeared as a possible solution to the problems of GET. An advan-
tage of the former over the latter is that it deals with strategic interaction be-
tween individuals. Except for this difference, however, it is just as individualistic
as GET. Unfortunately, game theory would soon prove to be no less indeterminate
than the latter. Multiple equilibria seem to be the rule, rather than the excep-
tion (Kreps 1990, p. 95107). Once again, it is suggested that methodological
484 UDEHN
individualism may be the problem and social institutions the solution (see, e.g.,
Mirowski 1986, Ferejohn 1991, Hargreaves et al. 1995, pp. 3135).
AUSTRIAN METHODOLOGICAL INDIVIDUALISM
The Austrian School of Economics is often mentioned as part of neoclassical

economics, but it is hardly mainstream. Austrian economics rejects equilibrium
analysis and sees the economy as a process that never reaches equilibrium. It is
less individualistic than GET, but it is much more explicit about its methodological
individualism.
The founder of Austrian economics, Carl Menger, was also the main pioneer
of methodological individualism. He did not use the term himself, but there
is little doubt that his atomistic method is the main source of the doctrine
later called methodological individualism. Already in his Principles of Eco-
nomics (1871), Menger tried to reduce the complex phenomena of the econ-
omy to their simplest elements, that is, the actions of individual human beings
(Menger [1871] 1976, p. 46ff.). In his next work, Problems of Economics and
Sociology (1883), he went from practice to principle and formulated the first
ambitious program of methodological individualism, or atomism, in the his-
tory of the social sciences. In order to understand economic phenomena we must
go back to their true elements, individual human beings, and try to find the
laws by which the former are built up from the latter (Menger [1883] 1963,
p. 93).
Unlike Walras, Menger had no intention of purging theoretical economics of
social institutions, but saw his main task as explaining their origin in the same
atomistic way as prices are explained in the exact science of theoretical economics.
According to Menger, social institutions like the family, the state, law, and money
emerge organically as the unintended end-result of a sequence of actions, which
are often intentional and rational in themselves. Money, for instance, developed out
of ordinary consumer goods, which proved particularly useful for storage and as
media of exchange, until they were replaced by todays pieces of metal and paper
(see Menger [1883] 1963, pp. 15258; 1892). Mengers explanation of the origin
of money is a classic example of an individualistic explanation of a social institu-
tion and represents, I believe, a third paradigm of methodological individualism
in the social sciences.5
First to use the term methodological individualism was Joseph Schumpeter
(1908, pp. 8898), but only to make a distinction between political and method-
ological individualism. Schumpeter added little to the meaning of this doctrine,
and he himself was not a methodological individualist, at least not when working
5
It might be added that Mengers plea for methodological individualism was limited to
the exact science of theoretical economics, but did not include history and the empirical-
realistic orientation in the social sciences.
as a sociologist. For Schumpeter methodological individualism was a method used

in theoretical economics, but not in sociology.
It was Max Weber who brought methodological individualism from economics
to sociology.6 In an oft-quoted letter to the economist Robert Liefmann he criti-
cized the use of collective concepts and suggested that sociology, too, can only
be practiced by proceeding from the action of one or more, few or many, indi-
viduals, that means, by employing a strictly individualist method (Roth 1976,
p. 306).
In Weber methodological individualism is inseparably linked to the idea of an
interpretive sociology that treats the single individual and his action as the ba-
sic unit, as its atom, if a questionable analogy is allowed here (Weber [1913]
1981, p. 158). More specifically, methodological individualism follows from the

subjectivism of his interpretive sociology, which is concerned with the under-
standing and causal explanation of social action. Understanding is achieved when
we know the subjective meaning that individuals attach to their own actions and
explanation when we know the motives they have for acting in a certain way. A
difference between interpretive sociology and traditional neoclassical economics
is that the former is concerned with social action, which takes account of the
behavior of others (Weber [1922] 1978, p. 4ff.; see also Swedberg 1998, pp. 5,
22ff.).
The reason Webers interpretive sociology implies an individualist method is
that only individuals attach a subjective meaning to their behavior. There is no such
thing as a collective personality, or actor. Collectives are nothing but complexes of
individuals acting in particular ways. If people frequently use collective concepts
and even believe that they refer to something real, this makes collectives real in
a sense, but their reality lies solely in the actions and beliefs of individuals. For
the purposes of interpretive sociology, social reality is the subjective meaning that
individuals attach to their own actions and those of others.
Weber was not really interested in the nature of social reality as such. Subjec-
tivism was a feature of his methodology, nothing more. But there were others, less
hesitant to engage in matters of ontology. One of them was the Austrian economist
Ludwig von Mises, who was influenced not only by Max Weber, but also by the
phenomenology of Franz Brentano and Edmund Husserl, and by the phenomeno-
logical sociology of Alfred Schutz.7 For him, subjectivism is primarily a question
of ontology and epistemology and only secondarily of methodology. Methodolog-
ical individualism, in the strict sense, follows from the ontological thesis that only
human beings exist, the ontogenetic thesis that society is a product of human
6
Weber was not the only methodological individualist among early sociologists. The French
sociologist Gabriel Tarde was an energetic defender of psychological reductionism, and the
early Georg Simmel may also be interpreted as a methodological individualist.
7
Actually Schutz was a pupil of Mises and the influence went in both directions, but the
publication in 1932 of Schutzs book Der Sinnhafte Aufbau der Sozialen Welt (The Pheno-
menology of the Social World ) was an important source of Misess subjectivism.
486 UDEHN
action, and the epistemological thesis that all knowledge about society derives
from knowledge about individuals. The first thesis is a special case of nominalism,
which Mises defended against the conceptual realism of those who believed that
collective concepts refer to real entities in the world. Social entities do exist, but
only in the minds of individuals (see von Mises [1933] 1976, pp. 42ff., 153; [1949]
1966, pp. 42, 187).
Friedrich von Hayek is probably the most well-known Austrian methodological
individualist. Unlike Mises, he was much influenced by Menger, and his method-
ology is a synthesis of elements taken from Menger, Weber, and Mises.
Mengers influence is most clearly seen in von Hayeks focus on spontaneous
orders and in the composite or synthetic method he used to analyze them

(von Hayek 1955, p. 39). The latter is identical with Mengers individualistic
or atomistic method of analysis (von Hayek 1934, p. 405ff.). By combining
elementary conclusions and following up their implications he [the economist]
gradually constructs, from the familiar elements, a mental model which aims at
reproducing the working of the economic system as a whole (von Hayek 1933,
p. 128). Like Menger, von Hayek used it to explain both recurrent phenomena,
such as prices, and the evolution of social institutions, such as language and money
(von Hayek 1955, p. 40).
The influence of Weber and von Mises is manifested in von Hayeks radical
and consistent subjectivism, which led to an attack on scientism, the common
but misguided attempt by social scientists to imitate the methods of the natural
sciences.
In fact, most of the objects of social or human action are not objective facts
in the special narrow sense in which this term is used by the Sciences and
contrasted to opinions, and they cannot at all be defined in physical terms.
So far as human actions are concerned the things are what the acting people
think they are. (von Hayek 1955, p. 26ff.)
According to von Hayek, not only human actions, but also artifacts such as money,
economic goods, tools, and the like, must be defined in terms of the beliefs people
entertain about them (von Hayek 1955, p. 27). All social phenomena are subjective,
and society, as a whole, is made up of the beliefs of individuals (pp. 33ff.). The
implication of this is not, however, that the social scientist is confined to using only
common sense concepts. Common sense is the point of departure, but not the end
of social science. The main reason for this is that human actions have unintended
consequences that go beyond the meanings that individuals attach to them. It is
the main task of social science to explain these unintended consequences.
To be sure, members of society have their own ideas about unintended conse-
quences, and more often than not these ideas are collectivistic. von Hayek calls
them speculative, in order to distinguish them from the constitutive ideas peo-
ple entertain about their own actions. The models social scientists use to explain
social phenomena are distinguished from both types of common sense ideas.
The social sciences . . . do not deal with given wholes, but their task is to
constitute these wholes by constructing models from the familiar elements
models which reproduce the structure of relationships between some of the
many phenomena which we always simultaneously observe in real life.
(von Hayek 1955, p. 56.)
Austrian methodological individualism differs from earlier versions of this doctrine
in one important respect. Its point of departure, at least from Weber and onwards, is
individuals as cultural beings living in society. According to Weber, von Mises, and
von Hayek, economics and sociology are cultural sciences. This does not imply
any break with methodological individualism, however. Society and culture are
subjective phenomena existing only in the minds of individuals, or epiphenomena.

Therefore, to explain human action in terms of social institutions is to explain
in terms of the beliefs, or attitudes of individuals. I call this the ontological
twist, because it saves methodological individualism by transforming it into an
ontological thesis about the ultimate nature of society.
The view of society emerging from the writings of Weber, von Mises, and von
Hayek may be called the intersubjectivist theory of society. It is a theory shared by
a number of influential sociological traditions, such as symbolic interactionism,
phenomenology, existential sociology and, I believe, ethnomethodology as well.
It is a theory implicit also in much social constructionism, but not, of course in the
branch that issues from French (post)structuralism.
POPPERIAN METHODOLOGICAL INDIVIDUALISM

Karl Popper is probably the best known of all adherents of methodological indi-
vidualism, if not among economists, at least among philosophers and sociologists.
He differs significantly from his Austrian forerunners by advocating objectivism
in methodology, epistemology, and ontology in the social sciences. Unfortunately,
Poppers views on methodological individualism have not contributed to an in-
crease in clarity about its exact meaning. The reason is that Popper attempted
to build his social science methodology out of two originally incompatible ele-
ments: individualism and institutionalism. These doctrines are traditional oppo-
sites, and Popper never succeeded in unifying them. It was left to his pupil,
Joseph Agassi, to bring them together into a new doctrine called institutional
individualism.
According to Popper, methodological individualism is the postulate, or unas-
sailable doctrine, that we must understand and use to explain all social phenom-
ena in terms of individuals, and of their aims, beliefs, attitudes, expectations,
actions, and interactions (Popper [1957] 1961, p. 136, 157ff.). This doctrine is
to be distinguished from the psychologism of John Stuart Mill, which Popper re-
jected, although not wholesale. In his view psychologism has one praiseworthy
aspect:
488 UDEHN
Psychologism is, I believe, correct only insofar as it insists upon what may
be called methodological individualism as opposed to methodological
collectivism; it rightly insists that the behavior and the actions of collec-
tives, such as states or social groups must be reduced to the behaviour and to
the actions of human individuals. But the belief that the choice of an individ-
ualistic method implies the choice of a psychologistic method is mistaken . . .
even though it may appear very convincing at first sight. (Popper [1945] 1966,
p. 91.)
Popper added to the merits of psychologism that it lends support to the important
doctrine that all social phenomena, and especially the functioning of all social
institutions, should always be understood as resulting from the decisions, actions,

attitudes, etc., of human individuals . . . (Popper [1945] 1966, p. 98). It is, indeed,
difficult to see any difference between Poppers methodological individualism and
psychologism (Wisdom 1970, Gellner 1973, p. 15).
As an alternative to psychologism, Popper suggested a methodology based on
situational logic and institutionalism. Situational logic is a generalization of the
method of economics and seems identical with what we nowadays call rational
choice (Hedstrom et al. 1998, p. 339ff.). In my view it is compatible with both
individualism and institutionalism. The main alternative to psychologism is insti-
tutionalism, or the claim that the actions of individuals cannot be explained without
reference to social institutions (Popper [1945] 1966, p. 90).
In fact, I propose to use the name social institution for all those things which
set limits or create obstacles to our movements and actions almost as if they
were physical bodies or obstacles. Social institutions are experienced by us
as almost literally forming part of the furniture of our habitat. (Popper 1994,
p. 167, originally written in 19631964.)
The problem with Poppers alternative is that institutionalism is incompati-
ble, not only with psychologism, but with his own methodological individualism
as well (see Udehn 1987, pp. 3339; 2001, pp. 202ff, 218ff.). This conflict be-
tween individualism and institutionalism in Poppers methodology led to a split of
methodological individualism in two: the psychologistic individualism of J.W.N.
Watkins and the institutional individualism of Joseph Agassi and Ian C. Jarvie.
Of all who defend it, J.W.N. Watkins has done the most to clarify the meaning of
methodological individualism. According to him, [t]his principle states that social
processes and events should be explained by being deduced from (a) principles
governing the behaviour of individuals and (b) descriptions of their situations
(Watkins 1953, p. 729). Watkinss methodological individualism is psychologistic
(Watkins 1952a, p. 28). This means that social institutions are excluded from
the description of the situations of individuals (see Watkins 1976, p. 710ff.), or
reduced to the attitudes of individuals toward things and other people (Watkins
1952a, p. 29; 1953, p. 729). It may also be noticed that Watkinss methodological
individualism is about the explanation of social phenomena, but not about the
definition of collective concepts (see, e.g., Watkins 1953, p. 729; 1955, p. 58;
1959, p. 320). This is a typical feature of Popperian methodological individualism,

as distinguished from Austrian methodological individualism, which was more
directed at the illegitimate use collective concepts.
Methodological individualism is based on the ontological truism that all social
phenomena are created, or caused, by individual human beings (Watkins 1952a,
p. 28; 1955, p. 58), who are also the ultimate constituents of the social world
(Watkins 1957, p. 105ff.). It is also based on the epistemological thesis that people
have direct access only to facts about individuals, but not to facts about social
wholes, knowledge of which is always derivative (Watkins 1952b, p. 186; 1953,
p. 729ff.).
It may, finally, be noticed that Watkins recognizes the existence of empiri-

cal generalizations about large-scale social phenomena, but claims that they are
in principle reducible to psychological laws. This is also a recurrent theme in
Watkinss writings, and eventually it leads him to recognize the existence of half-
way explanations of large-scale social phenomena in terms of other large-scale
social phenomena, as distinguished from rock-bottom explanations in terms of
individuals and their interrelations (Watkins 1957, p. 106).
A new version of methodological individualism was advanced by Joseph Agassi
in a suggestive article from 1960. It is called institutional individualism, and it is
based on Poppers institutionalism and situational logic, rather than on his method-
ological individualism, even though Agassi, at first, failed to realize that there is a
conflict between the first and the third of these doctrines. The important point about
institutional individualism is that it explicitly includes social institutions in the sit-
uation of individuals. According to Agassi, institutions constitute a part of the
individuals circumstances which together with his aims determine his behavior
(Agassi 1960, p. 247). This is in contradistinction to psychologistic individual-
ism, which only includes material conditions in the relevant circumstances.
Eventually Agassi came to realize that there was something wrong with Poppers
methodology. According to Agassi, he was unclear about matters and so is free for
all (Agassi 1972, p. 326). Still later Agassi (1975) reaffirmed his institutional indi-
vidualism, but made no further mention of methodological individualism. Another
route was taken by Ian C. Jarvie, who accepted Agassis institutional individual-
ism but continued to call it methodological individualism. Like Agassi, Jarvie
rejected psychological reductionism and went on to claim that social institutions
are as concrete and as real as his physical surroundings (Jarvie 1972, p. xiii).
There is clearly an important difference between the original principle of
methodological individualism and institutional individualism. The difference is
this: In the original version of methodological individualism, social institutions
are something to be explained in terms of individuals. They appear only in the ex-
planandum or, better, the consequent of an explanation, but never in the explanans,
or antecedent. In institutional individualism, on the other hand, social institutions
explain and, therefore, also appear in the explanans, or antecedent of an explana-
tion. That this is really a difference can be glimpsed from the fact that Jarvie had
earlier suggested that it is the distinctive feature of holism to put social wholes in
the explanans (Jarvie 1964, p. 69).
490 UDEHN
Another follower of Agassi, the economist Lawrence A. Boland, explicated the

difference between psychologistic and institutional individualism similarly, but in
a way that is better suited to economic theory. According to him (Boland 1982,
Ch. 2), the characteristic feature of psychologistic individualism is that social insti-
tutions appear, if at all, only among the endogenous variables in a model, whereas
the exogenous variables refer only to psychological states and natural constraints.
In institutional individualism, on the other hand, social institutions are permitted
among the exogenous variables as well. A perfect illustration of the difference
between psychologistic and institutional individualism can be found in the new in-
stitutional economics, which is an amalgam of the two versions. While the Chicago
School is most individualistic and tries to endogenize all social institutions, James
Buchanan is an emphatic defender of institutional individualism. The pioneering

work of Ronald Coase uses both strategies, as does that of Douglass North and
Oliver Williamsson. (See Udehn 2001, Ch. 9.)
THE SOCIOLOGICAL THEORY OF EXCHANGE
While Popper and his followers tried hard to find an individualistic alternative to
the psychologism of John Stuart Mill, the sociologist George C. Homans launched
a sociological theory of exchange (Homans 1958, 1961), which has almost every-
thing in common with Mills psychologism. The only difference is that Homans
replaced Mills associationist psychology with Skinners behaviorism, but since
the latter is a modern version of the former, this is not much of a difference.
Even though Homans accepted psychologism, he denied being a reductionist
on the ground that there are no general sociological propositions to reduce (1964,
p. 817; 1967, p. 8386; 1969, p. 15ff.). All general laws in the social sciences are
psychological laws. Homans soon detected that his own position coincided with
that of methodological individualism (Homans 1967, p. 61). More specifically,
methodological individualism entails psychologism (Homans 1970, p. 325). In the
end, it also seems as if Homans did identify his position as a form of reductionism.
Methodological individualism cum psychologism holds that all social phenomena
can be analysed without residue into the actions of individuals, and also that
sociological propositions, propositions about the characteristics of social groups
or aggregates, can in principle be derived from, reduced to, propositions about the
behaviour of individuals (Homans 1970, p. 325).
Homans was not alone in suggesting a sociological theory of exchange. Another
pioneer in this field was Peter M. Blau, who advocated a more structural approach
to social exchange, focusing on power (Blau [1964] 1986).8 The later development
of social exchange theory may be seen as a synthesis between the individualistic
approach of Homans and the structuralistic approach of Blau. Shortly thereafter,
Homanss behaviorism was replaced by rational choice as the microfoundation of
the theory of social exchange.
8
Blau later turned into a structuralist critic of methodological individualism.
A first step in this new direction was taken by Richard M. Emerson already
in his article on power-dependence relations (1962), before he adopted social
exchange theory. A fundamental thesis of this article is that power is a property of
social relations, not of actors (pp. 32ff.). It is also clear, if not explicit, that these
actors are conceived of as intentional and rational, rather than as passive adjusters
to stimuli.9 Far from abandoning his structuralism when turning to social exchange
theory (1969, 1972a,b), Emerson criticized Homans for neglecting social structure
(1972a, p. 41). He also generalized the theory of social exchange, so as to apply it
to social networks (1972b). In his latest works, Emerson and his colleagues have
mainly engaged in experimental work on relations of power in exchange networks
(Cook & Emerson 1978, Cook et al. 1983).

There is a certain ambiguity about the role assigned to social structure in the net-
work analysis of Emerson and Cook. According to Cook (1991, p. 32): The goal
was to construct a theory of social exchange in which social structure is the de-
pendent variable (see also Cook 1987, p. 214). This is, I believe, traditional
methodological individualism, even though Cook argues that Emersons approach
is not a manifestation of strong methodological individualism (1987, p. 220). There
is, however, abundant evidence to show that Emerson and Cook also used social
structure as an independent variable in their analyses. This is also fundamental
to the theory of power dependence, which conceives of power as a function, or
effect, of social position. I suggest, therefore, that social structure may be both a
dependent and an independent variable in the exchange theory of Emerson and his
followers. I interpret the following quotation as support for this argument:
Structure is conceived, according to exchange theory, as the interconnection of
various positions in an exchange network. Framed this way, exchange theory
can illuminate not only the behavior of actors, but the structures that emerge
as the result of these exchange relations. Furthermore, by focusing on a given
structure or social institution, exchange theory provides an explanation both
for the behavior of actors within structures and structure itself. (Cook et al.
1990, p. 160.)
Starting from classical structuralist sociology, rather than from social exchange
theory, a group around David Willer arrived at a position similar to that of Emerson
and Cook (Willer & Andersson 1981). The fact that there has been a controversy
between the two groups about substantive matters in network analysis does not
diminish the similarity in their general approach and in their methodology. If there
is a difference between them in this respect, it is this: the Willer group seems more
explicitly committed both to structuralism and to rational choice (Willer 1992,
Willer & Skvoretz 1997, Markovsky 1997).
The theoretical developments I have sketched are part of a convergence between
a number of theoretical traditions in North American sociology, including the
9
It is no accident that Emersons article on power-dependence is included in a volume on
rational choice (Abell 1991).
492 UDEHN
network theory of Harrison White and his followers, and the rational choicebased
exchange theory of James S. Coleman. A typical feature of this convergence is the
attempt to integrate micro- and macro-analysis, even if the emphasis is different
in the different traditions.
Outside the United States, Homanss behaviorist theory of exchange left its
mark on German sociology in particular, but it was behaviorism, rather than the
theory of exchange, that was exported. The leading representatives of behaviorist
sociology in Germany and in Europe were Hans J. Hummell and Karl Dieter Opp.
They used behaviorism as the psychological basis of an ambitious attempt to re-
duce sociology to psychology. This attempt was successful in their opinion, and
they claimed to have shown that sociological terms are definable by psychological
terms and sociological theories derivable from psychological theories (Hummell

& Opp 1968, pp. 22023; 1971, pp. 112). Hummell & Opp, at first, made no
mention of methodological individualism, but later they recognized a kinship be-
tween their own psychological reductionism and Joseph Agassis institutional
individualism (Hummell & Opp 1971, p. 8). This is a bit surprising, since Agassi
rejected psychologism, and advanced institutional individualism as an alternative
to it (see above). In his later writings, Karl-Dieter Opp abandoned behaviorism and
defended an individualist research program based on rational choice, rather than
on behaviorism (Opp 1979, 1988). This change was probably due to a shift in ori-
entation from George Homans to James Coleman as the main source of inspiration.
At the same time Opps individualistic research program (IRP) became less in-
dividualistic and incorporated an institutionalistic and structuralistic element. In
view of these features, the IRP should perhaps be called a structural-individualistic
research program in order to express that preferences and constraints (including
social structures) are determinants of social behavior (Opp 1988, p. 219).
The idea of structural-individualism originated with the Dutch-based sociolo-
gists Siegwart Lindenberg, Reinhard Wippler, and Werner Raub. The main source
of this idea seems to have been Lindenberg (1977), but it was probably Wippler
who coined the term structural individualism (1978). According to him, a typ-
ical structural-individualistic explanation consists of two steps: In a first step the
actions of individuals are explained, and in a second step the collective outcome
of the interdependent actions of many individuals are explained (Wippler 1978,
p. 143). Raub, on the other hand, seems to suggest that both steps may involve social
causes, which are a necessary, if not a sufficient, part of a structural-individualistic
explanation (Raub 1982, p. 8).
Dutch rational choice sociology owes much to James Coleman and Raymond
Boudon, who are the leading figures in this field of sociology. James Colemans
rational choice sociology is also the clearest example of structural individualism.
Rational Choice Sociology

James Coleman is well known as a propagator of individualistic microfoundations
for macrosociology, but less known as a structuralist. Nevertheless, in addition
to being an individualist, Coleman was a consistent structuralist throughout his

career, and the mix of these two elements creates a new synthesis that is properly
called structural individualism.
Colemans individualism was first clearly expressed in an article called Col-
lective Decisions from 1964, inspired by Homans theory of exchange, where he
took his point of departure in the theories of Thomas Hobbes and Adam Smith,
rather than in the homo sociologicus of the sociological tradition: I will start with
an image of man as wholly free: unsocialized, entirely self-interested, not con-
strained by norms of a system, but only rationally calculating to further his own
self interest (Coleman 1964, p. 167). Since then Coleman has mainly been preoc-
cupied with developing a general theory of social systems and with explaining the
emergence of social norms in terms of individuals alone. His efforts culminated

in the monumental Foundations of Social Theory (1990a), in which he identified
himself as a methodological individualist of sorts (p. 5ff.).10
Colemans structuralism has not attracted as much attention as his individual-
ism, but it is a scarcely less evident feature of his work. It is most evident in his
Power and the Structure of Society (1974) and The Asymmetric Society (1982).
In these books, Coleman focused on the development of corporate actors; states,
corporations, trade unions, parties, etc., as the most distinctive (and fateful) feature
of modern society. A consequence of this development is that the social system
now consists of two separate elements: natural persons and corporate actors, and
a corollary of this separation is that we must make a distinction between persons
and the positions they occupy as corporate actors (Coleman 1974, p. 36, 49; 1982,
p. 14ff.). Such a distinction is typical of social holism and had never before been
made by a methodological individualist.
Colemans structuralism was not a passing stage, but a consistent feature of his
social theory. It is clearly manifested in parts III and IV of his Foundations and in his
presidential address to the American Sociological Association in 1992 (Coleman
1993). In the latter, Coleman argued that positions or offices occupied by persons,
not the persons themselves, are the elements of the social structure of corporate
actors. Relations within corporate actors, therefore, are between positions, not
between persons.11
Colemans methodological individualism is closely associated with his quest
for microfoundations and may be illustrated by his well-known diagrammatic
representation of the micro-macro relation in social theory (Figure 1) (see Coleman
1986, pp. 1321ff.; 1990a, pp. 510; 1994, pp. 166ff.).
According to Coleman (1994), methodological individualism is represented by
arrows 13 in this diagram, and runs from macro to micro to macro. In other
words: (a) psychic states are explained in terms of social structure, (b) individual
10
On methodological individualism, see also Coleman (1986, pp. 1309; 1990b, pp. 50ff.;
1992, pp. 133ff.; 1994, pp. 166ff.).
11
That there are two sides to Colemans social theory is not my invention; it was also
recognized by Coleman himself (Coleman 1971, p. 74; 1992, p. 132).
494 UDEHN
Figure 1 Colemans micro-macro scheme.

behavior is explained in terms of psychic states, and (c) the behavior of the so-
cial system is explained in terms of the actions of individuals. It is quite clear
that Colemans methodological individualism is a weak version of this doctrine.
The explanation of psychic states in terms of social structure has no place in psy-
chologism or in any strong version of methodological individualism. Psychol-
ogism, or reductive methodological individualism, is represented by arrows 2
and 3. The question remains whether Colemans methodological individualism
is identical with Popperian institutional individualism. I am going to argue that it
is not.
Figure 1 is an inadequate or insufficient representation of Colemans theoretical
position. For one thing, it fails to convey the fact that social structure, according
to Coleman, affects not only the psychic states and behavior of individuals, taken
singly, but also determines how individual actions combine to produce system
behavior. This is clearly visible in Colemans critique of economics (Coleman
1984, p. 86; 1992, p. 147; 1993, p. 63)
Both the institutions through which the micro-to-macro link takes place, and
those through which the macro-to-micro link takes place, may be taken as
exogenous in rational choice theory, in studying the effects of particular insti-
tutional structures on individual actions or on systemic outcomes. (Coleman
1994, p. 171.)
According to Coleman, then, the influence of social structure is not limited to
individual action, as represented by arrow 1 in Figure 1, but also affects the way that
the actions of individuals combine to produce systemic outcomes. This argument
is directed at economists, who usually fail to appreciate the fact that different
institutional structures produce different aggregate outcomes. But there is one
more way in which social structure affects systemic outcomes. Social structure
takes the form of a set of interdependent positions that are prior to the interaction
between the individuals occupying these positions. According to Coleman, this
means that to talk about aggregation is misleading: for the phenomena to be
explained involve interdependence of individuals actions, not merely aggregated
individual behavior (Coleman 1990a, p. 22).
Much has been written in economics about the so-called aggregation prob-
lem. Perhaps the failure to solve this problem is a manifestation of the effects of
social structure on the interaction of individuals. If so, we might conceive of such

a failure as an operational definition of the notorious statement that the whole is
more than the sum of the parts. Since social structures, such as corporate actors,
exist as sets of interdependent positions that are relatively independent of the par-
ticular individuals that fill these positions, Coleman distinguished between natural
persons and social positions. This makes for a peculiar form of methodological
individualism, indeed (Coleman 1990b, p. 50ff.).
Structural individualism may be seen as a particular form of institutional in-
dividualism. The reason is that social structures are constituted and/or generated
by social institutions. It is also common to use the terms social institutions and
social structure interchangeably, or to talk about the institutional structure of

society (Coleman 1994, p. 171). I use the term social structure in a more nar-
row sense to denote a set of interrelated positions. It is possible to conceive of all
social structures as institutional, but not all social institutions are social structures
in this narrow sense. Structural individualism, then, is distinct from institutional
individualism because it adds something to the latter. It is also more holistic, since
it implies a set of interrelated positions that determine the interaction between
individuals occupying these positions, an idea that is central to most versions of
social holism (cf. Watkins 1953, p. 729).
Some examples may help to clarify the distinction. Language is a social insti-
tution constituted by the rules of grammar. When people follow those rules they
can interact with one another by means of language, but they do not occupy in-
terrelated positions prior to interaction, or if they do, these positions have nothing
to do with the rules of grammar. In the game of chess, people also follow certain
rules that constitute the game, but the positions they reach are consequences, not
preconditions, of their moves. Many social institutions are of this kind: rules that
govern the behavior of individuals in particular situations and give rise to certain
patterns of interaction. I assume that most institutional individualists conceive of
the market in this way.
Many Marxists, on the contrary, conceive of the market as a social structure,
where actors occupy positions as capitalists and workers, before they start to ex-
change. A less controversial example of a social structure is a bureaucracy, where
individuals more obviously occupy different positions in the hierarchy prior to any
interaction between them.
The difference between institutional and structural individualism, then, is this:
In institutional individualism, social institutions appear as exogenous variables,
or in the antecedent of social scientific explanations. Social structures, narrowly
conceived, appear, if at all, typically as endogenous variables, or in the consequent.
The defining characteristic of structural individualism, on the contrary, is that
social structures in the sense intended here, appear as exogenous variables, or
in the antecedent of social scientific explanations.
The second pioneer of rational choice sociology, Raymond Boudon, has been
more explicit about his allegiance to methodological individualism than has
Coleman (Boudon [1979] 1981, pp. 17, 3538; 1986, p. 42). He has also stated it
more explicitly:
496 UDEHN
To summarize: suppose M is the phenomenon to be explained. In the individ-

ualistic paradigm, to explain means making it the outcome of a set of actions
m. In mathematical symbols, M = M(m); in other words, M is a function of
the actions m. Then the actions m are made understandable, in the Weberian
sense, by relating them to the social environment, the situation S, of the actors:
m = m(S). Finally, the situation itself has to be explained as the outcome of
some macrosociological variables, or at least of variables located at a higher
level than S. Let us call these higher-level variables P, so that S = S(P). On the
whole, M = M{m[S(P)]}. In other words, M is the outcome of actions, which
are the outcome of the social environment of the actors, the latter being the
outcome of macrosociological variables (Boudon 1987, p. 46).

On the face of it this is the same version of methodological individualism that

we saw in James Coleman, but expressed in a different language. M = M(m) cor-
responds to arrow 3, m = m(s) to arrow 2, and S = S(P) to arrow 1 in Colemans
scheme. A difference between them, however, is that Boudon attached much more
importance to m = m(S), the understanding of human action in terms of the situa-
tion in which they act (Boudon [1984] 1986, pp. 29ff., 1988). In his more recent
writings, Boudon has developed a cognitivist model, which pays more intention to
subjective meaning than to objective constraints (Boudon 1989, 1996, 1998). While
Coleman is close to the objectivist institutional individualism of Popper and his
followers, Boudon is closer to the subjectivist methodological individualism of
Max Weber and the Austrians. This does not necessarily mean that Boudon ad-
heres to the strong version of methodological individualism. There is also a place
for social institutions and social structure in his methodological individualism
(cf. Hechter 1983, p. 8), even though it seems to me that this element has vanished
over time.
It is the conclusion of this section that the methodological individualism of
Coleman, Boudon, and some other sociologists is different from all other versions
of this doctrine. Because of the importance attached to social structure in this
form of methodological individualism, it is best characterized as structural indi-
vidualism. What makes this version different from institutional individualism is
the idea of social structure as a system of interrelated positions that is relatively
independent of individuals, at least of each particular individual.
Analytical Marxism
I think of Marxism as one of the most clear-cut examples of structuralism in the
social sciences (cf. Levine et al. 1987, p. 67ff.; Sensat 1988, p. 20915). When
some analytical Marxists argued recently that Marxism needs a new edifice erected
on the two pillars of rational choice and methodological individualism, I would
have expected the latter to assume the form of structural individualism. This is also
what many Marxists seem to suggest (Taylor 1988, p. 94; Little 1998, Ch. 1). The
surprising thing is that two of the most well-known advocates of rational choice
Marxism, Jon Elster and John Roemer, opt for the strong, reductionist version of
methodological individualism.
Like most rational choice theorists, Elster sees methodological individualism

as a quest for microfoundations. More specifically, he advocates a methodology
directed at laying bare the causal mechanisms that explain social phenomena. In his
early plea for rational choice, he set great hope on game theory as a vehicle for pro-
viding suitable microfoundations for Marxism (Elster 1982, 1985, p. 5ff.). In con-
formity with the strong version of methodological individualism, Elster conceives
of social mechanisms in the microfoundation as nothing but individuals, their be-
liefs, and interaction (Elster 1985, p. 5; 1989, p. 13). As a consequence of this, he
also admits to being a psychological reductionist (1989, p. 74; 1993, p. 711).
John Roemer is an economist who uses the tools of neoclassical economics
to attempt a reconstruction of Marxist economics, especially the theory of ex-

ploitation. One implication of this attempt is strong methodological individual-

ism. Social institutions and social structure appear in his model as endogenous,
but not as exogenous, variables (Roemer 1981, p. 7; 1982a, p. 15; 1982b, p. 518;
1982c, p. 262ff.). Another task of rational choice individualism is to explain where
preferences come from. The goal, once again, is to provide an endogenous expla-
nation within the neoclassical framework (Roemer 1986, p. 193ff.). It seems to me,
though, that Roemer eventually adopted an approach to preference formation that
accepts social structure as an exogenously given variable (Roemer 1989, p. 278).
If this interpretation is correct, he has finally settled for structural individualism.
Paradoxically, then, rational choice Marxism seems, on the whole, to be less
structuralistic than is rational choice sociology, even though it has added some
ideas about preference formation to structural individualism.
Versions of Methodological Individualism

I have sketched the history of methodological individualism and identified a num-
ber of different versions of this doctrine. In this section, I summarize and system-
atize the results of my investigation.
Methodological individualism was advanced by Max Weber and the Austrians
in particular, as a principle about the definition of collective concepts. It has been
advanced, especially by Popper and his followers, as a principle about the expla-
nation of social phenomena. Finally, George Homans and his followers pursued
it as a principle about the reduction, if not of laws, then at least of empirical
generalizations.
Strictly speaking, methodological individualism is a principle, rule, or program
telling historians and social scientists how to define collective concepts, explain so-
cial phenomena, and/or reduce macro to micro. Methodology is normative. Many
advocates of methodological individualism, however, state it as a thesis about the
cause and/or nature of social phenomena. Social phenomena are caused or created
by individuals, and they are made up of individuals. To cite a well-known statement
made by Epicurus and repeated by Margaret Thatcher: There is no such thing
as society, at least not as distinct from individuals. Most methodological indi-
vidualists sometimes state this principle as an ontological thesis about the cause
and/or nature of social phenomena, but such statements are most common in the
498 UDEHN
writings of Ludwig von Mises. J.W.N. Watkins initially stated it this way, but later
used ontological individualism in support of methodological individualism. Since
ontological individualism is trivially true, methodological individualism follows
naturally.
Sometimes methodological individualism is also stated as, or supported by, an
epistemological thesis about knowledge (Scott 1960, Rosenberg 1988, p. 114ff.).
Once again, this is most common in the writings of Mises and Watkins, but such
statements can be found in the writings of most methodological individualists.
Because only individuals can be directly observed in society, it is suggested that
all knowledge about social phenomena can, at least in principle, be stated in terms
of individuals: Social concepts can be defined in terms of individuals, social phe-

nomena explained in terms of individuals, and macro-theories reduced to micro-

theories. For some methodological individualists, but not for all, this means that
the social sciences are reducible to psychology.
By combining the two classifications: (a) concept-explanation-reduction and
(b) methodology-epistemology-ontology, we arrive at the following scheme over
different versions of methodological individualism, or of the individualist research
tradition.
Of the different versions of methodological individualism presented in Figure 2,
I suggest that 1b has a special status as the most important. For Popper and his
followers, this version is all-important, but I believe that most methodological
individualists would single it out as most important if pressed for an answer. It
is probably the only version that all adherents would accept as a proper part of
methodological individualism.
The main argument of this article is not, however, that there are the different
versions identified in Figure 2, but that there are also different versions of 1b,
more or less individualistic. Closer scrutiny reveals that it is possible to identify at
least four or five versions of methodological individualism that differ in degree of
individualism.
The doctrine of methodological individualism, then, ranges from versions re-
quiring that social phenomena be fully explained in terms of individuals, to versions
requiring only that they be partly explained in terms of individuals. How large this
individualistic part must be is not stated, and cannot be stated, at least not precisely,
but it is possible to conceive of a version of methodological individualism that as-
signs virtually all explanatory power to social institutions and social structure, and
only a small fraction of it to individuals.
There has been in the history of methodological individualism a development
from extreme to less extreme versions of methodological individualism. This de-
velopment has not been linear, but overall the tendency has been clear: From the
extreme versions of methodological individualism, exemplified by the theory of the
social contract and Walrass theory of general equilibrium, to the Austrians, who
conceived of human beings as social beings, to Popper, who introduced social in-
stitutions as objective constraints upon action, and finally, to the sociologists, who
introduced the originally holistic idea of social structure as made up of positions
related to one another independently of their occupants.

Figure 2 The individualistic research tradition.
Presented in order of descending individualism, the main versions of method-

ological individualism are these:
1. The theory of the social contract, which takes as its point of departure the na-
tural (asocial) individual, living without social institutions in a state of nature.
2. The theory of general equilibrium, which takes as its point of departure the
isolated individual without social relations, interacting on the market in the
absence of social institutions and technology.
3. Austrian methodological individualism, which first proceeded by assuming
the isolated individual, or Robinson Crusoe, but which later conceived of
individuals as social or cultural beings who attach subjective meaning to
their own actions and to human artifacts.
4. Popperian methodological individualism, which accepts objectively existing
social institutions in the antecedent of social scientific explanations, or as
exogenous variables in social scientific models.
5. Colemans methodological individualism, which admits of social wholes in
the form of structures of interrelated positions, which exist independently of
the particular individuals who happen to occupy these positions.
500 UDEHN
I suggest that we call versions 1 and 2 natural individualism, since nothing socio-
cultural enters the antecedents of its explanations or the exogenous variables of its
models. This version is sometimes called atomistic methodological individualism,
but this name is problematic, since it was first used by the Austrians, who had a
different conception of the individual.
In order to distinguish Austrian methodological individualism from 1 and 2,
I suggest that we call it social individualism, to acknowledge its conception of
individuals as social beings, and of society as an intersubjective reality. Social
individualism is a typical feature of microsociological theories such as symbolic
interactionism, phenomenology, and ethnomethodology.
I call Popperian methodological individualism institutional individualism, as

suggested by Joseph Agassi. Institutional individualism is the dominant version of

methodological individualism, both in political science and in the new institutional
economics, even though many economists cherish the dream of being able to
endogenize all institutions.
Borrowing a term from some Dutch sociologists I call Colemans methodolog-
ical individualism structural individualism. This form of methodological indi-
vidualism is common today, perhaps dominant among sociological and Marxist
methodological individualists.
The main divide separates strong methodological individualism (13) and weak
methodological individualism (45). It is in the move from 3 to 4 that social in-
stitutions jump from the endogenous to the exogenous part of social scientific
models and from the consequent to the antecedent of social scientific explana-
tions. This is clearly the most decisive break with methodological individualism
as originally conceived. It is a move that makes it difficult to continue talking about
individualism and holism as opposite doctrines.12
Another related divide separates the subjectivist methodological individualism
of the Austrians and the objectivist methodological individualism of the Popperi-
ans. This divide is related to the one above in that a subjectivist approach focuses
on the preferences and beliefs of individuals, while an objectivist approach tends to
focus on social institutions and structures as external constraints upon action.13 The
former approach tends to use a richer (thick) psychology than the latter, which re-
lies on simple assumptions about individual behavior (thin psychology).14 Among
rational choice individualists, Boudon and Elster use a more subjectivist approach
with a rich psychology, and Coleman a more objectivist approach, focusing upon
constraints rather than upon the minds of individuals.
12
A good illustration of this difficulty is the holistic individualism of Philip Pettit ([1993]
1996: 165ff.).
13
This relation is not necessary, however, as witnessed by the case of Gary Becker, who
focuses upon external constraints, but not in the form of social institutions and structures.
14
Similar but not identical distinctions have been made by Siegwart Lindenberg (1992,
1996), and John Goldthorpe (2000: Ch. 6). It should be noted that the distinction I make
between subjectivist and objectivist approaches is not the same as the distinction between
subjective and objective rationality.
A final note should be made about the status and normative force of method-
ological individualism. There are some who see methodological individualism as
an a priori and universal principle of social scientific research: an obligatory rule
or categorical imperative, unconditionally binding for all social scientists, because
it is based on certain self-evident truths about society and our knowledge about
it. There are others who see methodological individualism as a heuristic device
or research program, the fertility of which can only be ascertained a posteriori.
In the former category belong John Stuart Mill, Ludwig von Mises, Friedrich von
Hayek, Karl Popper, J.W.N. Watkins (initially), and Jon Elster, among others. In
the latter category belong Carl Menger and Joseph Schumpeter, but probably also
Max Weber, George Homans, and James Coleman. It seems reasonable to assume
that the former position is more common among philosophers, while the latter is
more common among social scientists.
CONCLUSION
The argument of this article has been that methodological individualism exists in
a number of different versions that must be clearly distinguished for a meaningful
discussion to be possible. Failure to make the necessary distinctions has created
much confusion about methodological individualism in the past, and it is hoped
that this article will contribute to increasing clarity about the issues involved in the
future. What, then, are the benefits of recognizing different versions of method-
ological individualism? I conclude with some examples.
Many methodological individualists fail to distinguish between ontological,
epistemological, and methodological individualism, strictly speaking. This failure
has been the source of much confusion because it is possible to be an ontological
and/or epistemological individualist, without being a methodological individualist
in the strict sense. To believe that society is made up of individuals and nothing
else does not imply that all social phenomena must be explained in terms of
individuals and their interaction. It is often argued, for instance, that it is impossible
to endogenize all social institutions, since the attempt to do so leads to an infinite
regress (see, e.g., Popper [1945] 1966, pp. 9093). If this argument is correct,
strong methodological individualism is not a viable position, even if ontological
individualism is self-evidently true, as most methodological individualists seem
to believe. It is also possible to believe that sociological theories are reducible to
psychological theories, in principle, and yet to deny that they are also reducible
in practice. The opposite: to endorse strict methodological individualism while
rejecting ontological and/or epistemological individualism, is also possible, if more
farfetched and less common.
It is also possible to take different stands on the issue of methodological in-
dividualism with respect to concepts, explanations, and laws. Few believe, for
instance, that all collective concepts are reducible to individualist concepts, but
this implies little about explanations and laws. We may need collective con-
cepts to refer to large-scale social phenomena, such as nations, states, churches,
502 UDEHN
corporations, etc., but this does not force us to explain social phenomena in terms
of these entities. In recent years, the dearth of commonly accepted social laws have
made many social scientists pessimistic about the prospects of turning the social
sciences into nomothetic disciplines. Increasing doubts about the preeminence of
the deductive-nomological, or covering-law model of scientific explanations have
worked in the same direction. The current emphasis on social mechanisms (see,
e.g., Elster 1989, p. 310; Hedstrom & Swedberg 1996, 1998) may be seen as a
sign of the decreasing importance attached to laws in social science, especially
sociology. But if commonly accepted laws are the exception rather than the rule in
the social sciences, it is not fruitful to conceive of methodological individualism
as a program for the reduction of social laws. The most fruitful alternative, I sug-
gest, is to see methodological individualism as a principle about the explanation

of social phenomena.
The most important distinction to make, however, is that between strong and
weak versions of methodological individualism. To know that a particular social
scientist, or philosopher, is a methodological individualist is not very enlightening
until you know what kind of methodological individualist he or she is. With the
occurrence of institutional and structural individualism on the scene, important
holistic elements were included in methodological individualism. The result is
that the previous line separating methodological individualism and holism has
become blurred and the two doctrines no longer appear as clear-cut opposites.
Weak methodological individualism is a mix, or synthesis, of individualistic and
holistic elements.
One important repercussion of the emergence of a weak version is that method-
ological individualism is much less vulnerable to critique from a holistic point of
view. Virtually all arguments hitherto raised against methodological individual-
ism are directed at the strong version, but fail to hit the weak version. This does
not necessarily mean that the weak version is inviolable, but it does mean that
critics of methodological individualism must either deny that the weak version is
true methodological individualism or else reconsider their case (cf. Udehn 1987,
pp. 3948).
It may be noticed that weak methodological individualism is most common
in sociology, whereas most economists still stick to the strong version. This fact
is probably one reason why individualism has recently been seen as a problem
among some leading economists, such as Kenneth Arrow and Alan Kirman, but
as a solution among leading sociologists, such as James Coleman and Raymond
Boudon. If they intend different things by methodological individualism, their
diverging opinions about its merits may very well be more apparent than real.
It is, finally, of great importance to distinguish between methodological indi-
vidualism as a heuristic device among others, and as a universal rule applicable
to all social scientific research. In the former case, all versions of methodolog-
ical individualism may be fruitful for certain purposes. In the latter case, the
fertility of strong methodological individualism, in particular, is open to serious
doubt.
The Annual Review of Sociology is online at http://soc.annualreviews.org
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P1: FRK
June 10, 2002 12:5 Annual Reviews AR163-FM
Annual Review of Sociology

Volume 28, 2002
CONTENTS
FrontispieceStanley Lieberson x
PREFATORY CHAPTER
Barking Up the Wrong Branch: Scientific Alternatives to the Current

Model of Sociological Science, Stanley Lieberson and Freda B. Lynn 1
THEORY AND METHODS
From Factors to Actors: Computational Sociology and Agent-Based
Modeling, Michael W. Macy and Robert Willer 143
Mathematics in Sociology, Christofer R. Edling 197
Global Ethnography, Zsuzsa Gille and Sean O Riain 271
Integrating Models of Diffusion of Innovations: A Conceptual
Framework, Barbara Wejnert 297
Assessing Neighborhood Effects: Social Processes and New
Directions in Research, Robert J. Sampson, Jeffrey D. Morenoff,
and Thomas Gannon-Rowley 443
The Changing Faces of Methodological Individualism, Lars Udehn 479
SOCIAL PROCESSES
Violence in Social Life, Mary R. Jackman 387
INSTITUTIONS AND CULTURE
Welfare Reform: How Do We Measure Success? Daniel T. Lichter
and Rukamalie Jayakody 117
The Study of Islamic Culture and Politics: An Overview and
Assessment, Mansoor Moaddel 359
POLITICAL AND ECONOMIC SOCIOLOGY
Financial Markets, Money, and Banking, Lisa A. Keister 39
Comparative Research on Womens Employment, Tanja van der Lippe
and Liset van Dijk 221
DIFFERENTIATION AND STRATIFICATION
Chinese Social Stratification and Social Mobility, Yanjie Bian 91
v
P1: FRK
June 10, 2002 12:5 Annual Reviews AR163-FM
vi CONTENTS
The Study of Boundaries in the Social Sciences, Michele Lamont

and Virag Molnar 167
Race, Gender, and Authority in the Workplace: Theory and
Research, Ryan A. Smith 509
INDIVIDUAL AND SOCIETY
Reconsidering the Effects of Sibling Configuration: Recent
Advances and Challenges, Lala Carr Steelman, Brian Powell,
Regina Werum, and Scott Carter 243
Ethnic Boundaries and Identity in Plural Societies, Jimy M. Sanders 327
POLICY
Ideas, Politics, and Public Policy, John L. Campbell 21
New Economics of Sociological Criminology, Bill McCarthy 417
HISTORICAL SOCIOLOGY
The Sociology of Intellectuals, Charles Kurzman and Lynn Owens 63
INDEXES
Subject Index 543
Cumulative Index of Contributing Authors, Volumes 1928 565
Cumulative Index of Chapter Titles, Volumes 1928 568
ERRATA
An online log of corrections to Annual Review of Sociology chapters
(if any, 1997 to the present) may be found at http://soc.annualreviews.org/

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Annu. Rev. Sociol. 2002. 28:479507

THE CHANGING FACE OF METHODOLOGICAL

Eskilstuna, Sweden; e-mail: lars.udehn@mdh.se

Key Words institutionalism, structuralism, methodology, individualism

been a conspicuous lack of rationality in the debate between representatives of the

strong and weak versions of methodological individualism before discussing its

THE THEORY OF THE SOCIAL CONTRACT

METHODOLOGICAL INDIVIDUALISM 481

be achieved by entering into a second contract. In this contract, individuals institute

METHODOLOGICAL INDIVIDUALISM 483

AUSTRIAN METHODOLOGICAL INDIVIDUALISM

The Austrian School of Economics is often mentioned as part of neoclassical

METHODOLOGICAL INDIVIDUALISM 485

as a sociologist. For Schumpeter methodological individualism was a method used

1981, p. 158). More specifically, methodological individualism follows from the

orders and in the composite or synthetic method he used to analyze them

METHODOLOGICAL INDIVIDUALISM 487

subjective phenomena existing only in the minds of individuals, or epiphenomena.

POPPERIAN METHODOLOGICAL INDIVIDUALISM

institutions, should always be understood as resulting from the decisions, actions,

METHODOLOGICAL INDIVIDUALISM 489

1959, p. 320). This is a typical feature of Popperian methodological individualism,

It may, finally, be noticed that Watkins recognizes the existence of empiri-

Another follower of Agassi, the economist Lawrence A. Boland, explicated the

Buchanan is an emphatic defender of institutional individualism. The pioneering

THE SOCIOLOGICAL THEORY OF EXCHANGE

METHODOLOGICAL INDIVIDUALISM 491

(Cook & Emerson 1978, Cook et al. 1983).

terms and sociological theories derivable from psychological theories (Hummell

Rational Choice Sociology

METHODOLOGICAL INDIVIDUALISM 493

to being an individualist, Coleman was a consistent structuralist throughout his

emergence of social norms in terms of individuals alone. His efforts culminated

Figure 1 Colemans micro-macro scheme.

METHODOLOGICAL INDIVIDUALISM 495

social structure on the interaction of individuals. If so, we might conceive of such

social structure interchangeably, or to talk about the institutional structure of

To summarize: suppose M is the phenomenon to be explained. In the individ-

outcome of macrosociological variables (Boudon 1987, p. 46).

On the face of it this is the same version of methodological individualism that

METHODOLOGICAL INDIVIDUALISM 497

Like most rational choice theorists, Elster sees methodological individualism

to attempt a reconstruction of Marxist economics, especially the theory of ex-

ploitation. One implication of this attempt is strong methodological individual-

Versions of Methodological Individualism

of individuals: Social concepts can be defined in terms of individuals, social phe-

nomena explained in terms of individuals, and macro-theories reduced to micro-

METHODOLOGICAL INDIVIDUALISM 499

Figure 2 The individualistic research tradition.

Presented in order of descending individualism, the main versions of method-

I call Popperian methodological individualism institutional individualism, as

suggested by Joseph Agassi. Institutional individualism is the dominant version of

METHODOLOGICAL INDIVIDUALISM 501

gest, is to see methodological individualism as a principle about the explanation

METHODOLOGICAL INDIVIDUALISM 503

The Annual Review of Sociology is online at http://soc.annualreviews.org

J. Sociol. 26:14455 tionality Soc. 8:12350

R Swedberg, pp. 16580. Princeton, NJ: Berger, M Zelditch, B. Andersson, 2:5887.

Cook KS, Emerson RM. 1978. Power, equity Norton

METHODOLOGICAL INDIVIDUALISM 505

to psychology: a program, a test, and the the- J. 2:23955