Crossing the Boundary of Economics and Sociology: The Case of Vilfredo Pareto

American Journal of Economics and Sociology, The,  April, 2001  by Patrik Aspers

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PATRIK ASPERS [*]

ABSTRACT. The aim of the paper is to present the economic sociology of Vilfredo Pareto. We argue that Pareto represents a mode of thinking that has not been used in economic sociology and barely considered in the other branches of sociology. We reject the habitual bifurcation of Pareto into "the economist" and "the sociologist." Pareto stresses the non-logical parts of human life, and he provides empirical examples of this in his writing. He was occupied with the dynamics in society as a result mainly of non-logical actions. We show how one may speak of a distinctly Paretian economic sociology, which primarily has its origin in his theoretical discussions. We also show that Pareto conducted empirical studies drawing from his version of economic sociology. Included is finally a presentation, as well as a discussion of Pareto's idea of rentiers and speculators, which is followed up by a more general discussion of economic types in the market.

I

Introduction

TODAY'S ECONOMIC SOCIOLOGY seems to work along various philosophical, theoretical, and methodological tracks. Three of these can easily be located: network theory, cultural sociology, and organizational sociology (Swedberg 1997). This heterogeneity, of course, is not unusual in sociology. But when sociology is contrasted with economics, with its more homogenous foundation, this may be viewed as a problem.

That our picture of economics is reasonably homogenous is due to the works of Alfred Marshall (1842-1924), Leon Walras (1834--1910), and others who formed the neoclassical school of economics about 100 years ago. Contemporary economists, however, draw on these writers. In contrast, some economic sociologists seem to think that classical economics can be useful to study (see, for example, Aspers 1999, Swedberg 1998, 1987, Tilman 1997). A reason for studying classical economists and sociologists today is that the boundaries between the disciplines were not as sharp when they were institutionalized as they are today.

An example of a classical thinker is the Italian Vilfredo Pareto (1848--1923). Nevertheless, I have not found any attempts in the English literature, prior to this study, to thoroughly study Pareto as an economic sociologist. [1] Why are no studies undertaken in order to find out his potential contribution to economic sociology? It has been argued that Pareto made a 'clear" distinction between economics and sociology. [2] This means that one can argue that there is both Pareto the economist and Pareto the sociologist. However, his liberal political economy attitude, which tends to be less attractive to the sociologist, and his relation to fascism, may be other reasons for his neglect. [3] Finally, the fact that Pareto stressed the non-logical part of human life may have caused people not to study him. Are these reasons good reasons for not studying Pareto? [4] I think not, and I will try to show Pareto's contribution to our understanding of the economy in this paper.

In order to do this I first give a background to Pareto's thinking, and I discuss his ideas about the boundaries between economics and sociology. I then focus on Pareto's analysis of the level of aggregates, which is based upon his analysis of actions. This discussion leads to the central idea of Pareto that the different parts of society are interdependent. After looking at some of the more theoretical points, I present and discuss one of Pareto's main economic sociological insights: rentiers and speculators, the two types of capitalists that may have conflicting interests.

II

Pareto's Background and His Intellectual Legacy

VILFREDO PARETO WAS a trained engineer and his knowledge of mechanics comes through in his writing. Pareto's language is "objective," "positive," and colored with mechanical words, though he in substance shows more of a biological dimension. It is clear that much of his scientific method originates from the French mechanical-positive tradition. It is moreover clear that while his early training was influential, he gradually became aware of the necessity of a separate method for the social sciences (cf. Aron 1970, Parsons 1937/1949:181). Pareto's scientific thinking, however, is not an adoption of the mechanical thinking; it is better to stress its evolutionary and "biological" dimensions. Pareto, who started out with economics, became more and more convinced that society could only be grasped as a social system. This biologically grounded idea of social systems was later adopted in economic sociology. [5]

Pareto was contemporary with Alfred Marshall (1842--1924), and not much older than Emile Durkheim (1858--1917) and Max Weber (1864--1920). [6] Both Durkheim (1893/1984, cf. Parsons 1968, vol. 4:312--14) and Weber (1921--22/1972), though with different methods and to different degrees, tried to relate economic thinking and social thinking. Pareto started out his career in the social sciences as an economist, but moved towards sociology with an outspoken attempt to integrate the study of economic phenomena in a broader sociological framework. Only his Mind and Society (1915--16/1935) deals thoroughly with the synthesis of his economic and social thinking, and is therefore used as the main source of information in this paper.