Ringa Raudia

References Max Weber, the Protestant Ethics, and the Fischoff, Ephraim. 1991 [1944]. "The Protestant Ethic and the Spirit of Sociology of Capitalist Development Capitalism: The History of a Controversy." Social Research 2: 53-77. Reprinted in Max Weber: Critical Assessments, Vol. 2, ed. Peter Alexander Ebner Hamilton. London: Routledge.

Lessnoff, Michael. 1994. The Spirit of Capitalism and the Protestant Ethic. An Enquiry into the Weber Thesis. Aldershot: Edward Elgar. 1. Introduction

Poggi, Gianfranco. 1983. Calvinism and the Capitalist Spirit. Max We- ber's Protestant Ethic. Amherst: The University of Massachusetts Recent debates on the dynamics of capitalist development have Press. once again focused on the ideological underpinnings of the devel­ opment process, thus highlighting the role of religion and specific

Prisching, Manfred. 1996. "The Enterpreneur and His Capitalist Spirit - world-views in shaping the institutional foundations of modern Sombart's Pscyho-Historical model." In Werner Sambart (1863- capitalism. Accordingly, to put it in the terms of Max Weberand 1941): Social Scientist. Vol 2. His Theoretical Approach Reconsid- ,t:<' ered, ed. Jürgen Backhaus. Metropolis-Verlag: Marburg. fellow contemporary sociologists and economists, it may be argued that quest for the spirit of capitalism still provides a most relevant Schneider, Dieter. 1996. "Sombart or Spirit and Accountability of Capi­ topic for major research endeavors. In particular recent advances in talism as "Enthusiastic Lyricism". In Werner Sambart (1863-1941): the domain of economic and social history have followed Weber in Social Scientist. Vol 2. His Theoretical Approach Reconsidered, ed. outlining the institutional specificity of the Western European Jürgen Backhaus. Metropolis-Verlag: Marburg. economy as a birthplace of modern capitalism (North and Thomas Sombart, Wemer. 1998 [1915]. The Quintessence of Capitalism: A Study 1973, Jones 1981, Rosenberg and Birdzell 1986, Mokyr 1990, of the History and Psychology of the Modern Business Man. London: Landes 1998, Lai 1998, North 2005). Proposed factors in the his­ Routledge. torically unique 'rise of the West' point at aspects such as the po­ Vom Brocke, Bemhard. 1996. "Wemer Sombart, His Life, Works and In­ litical competition among states, political freedom, property rights, fluence." In Werner Sambart (1863-1941): Social Scientist. Vol 2. the emergence of markets, technological innovation, and the rise of His Theoretical Approach Reconsidered, ed. Jürgen Backhaus. Me­ rational thought. While the debate goes on, it remains quite difficult tropolis-Verlag: Marburg. to understand that most of these recent contributions implicitly fol­ Weber, Max. 1930. The Protestant Ethic and the Spirit of Capitalism. low the lead of Weberian analysis without explicitly referring to London: Unwin. Weber's original thesis on the role of the Protestant ethic in capital­

Zelizer, Viviana. 1978. "Human values and the Market: The Case of Life ist development. This is even more curious given the fact that the Insurance and Death in 19th Century America." American Journal of issue of Protestantism is a decisive feature in Weber's sociology­ Sociology 94 (3): 591-610. and thus a key component of the intellectuallegacy of modern so­ cial sciences at large.

230 231 Alexander Ebner Max Weber, the Protestant Ethics, and the Sociology of Capitalist Development

Accordingly, the following sections elaborate on a reappraisal of causal analysis in Weber's comparative-historical approach (Kai­ Weber's related work. berg 1994).

The presentation proceeds as follows. The first section outlines In this line of reasoning, the Weberian renaissance in sociological Max Weber's research program, highlighting the sociology of capi­ theory has been designated to articulate the critique of structuralist talist development as a key concern. The second section discusses and functionalist interpretations of Weberian thought, which had Weber's thesis of the Protestant ethics as a major factor in the become prevalent in particular with Parson's approach to social genesis of Occidental capitalism. The third section provides an as­ theory as a theory of social systems. This basic orientation in the sessment of the intellectual context and most relevant criticism of criticism of structuralist and functionalist positions has been stimu­ this thesis, covering a set of issues that ranges from Weber's con­ lated most pressingly by argumentssuch as Tenbruck's on the role temporaries to the most recent controversies. The paper concludes of religious aspects in Weber's theorising. Indeed, Tenbruck argues that the Weber thesis on the Protestant ethics has proven its rele­ that that the centre of Weber's sociology is created by the analysis vance for further discussions on the evolution of modern capitalism of historico-religious disenchantment and rationalisation as a uni­ - also with regard to current institutional transformations in the versal sequence that contributed decisively to the rise of the West­ context of globalisation. ern World (Tenbruck 1980). Accordingly, it is the matter of chang­ ing religious belief-systems and world-views that constitutes a key 2. Max Weber's Sociology of Capitalist Development: concern of Weber's account of the cultural evolution of modern so­ An Outline cieties, involving its differentiated institutional architecture. In this setting, the role of the Protestant ethics in the institutional evolution Weber's sociological approach is said to resemble a most compre­ of modern capitalism is settobe decisive. hensive attempt in promoting a unified theoretical and empirical re­ However, sociological modifications of that position have been search program of the social sciences. Related attempts in recon­ controversially pinpointing the aspect of rationalisation as a process structing the unity of Weber's social thought address the argument of continuous disenchantment that shapes both individual and col­ that the relation between culture and social life, basically the inter­ lective levels of social action. In particular, Schluchter identifies dependence of belief-systems and social reality, constitutes the ba­ Western rationalisation as Weber's main concern that would result sis of Weberian ideas in terms of a comprehensive sociology of in a diversity of segmented attempts at formulating a universal his­ culture. Thus, based on the Weberian social-ontological dualism, tory. Basedon that assessment, Schluchter's analytical framework which informs his analysis of the process of rationalization, it has focuses on the notion of structural principles and their ethical­ been suggested that Weber factually formulated a valuable compar­ institutional dimensions, which allows for delimiting Weber's de­ ison of historical cultures (Schroeder 1992). Concerning Weber's velopmental history from accompanying strands of evolutionism sociological research concepts, then, major components like the and systems theory by underlining the corresponding theory of ac­ agency-structure problern as weil as the conceptual implications of tion (Schluchter 1981). Weber actually believed that capitalism the multi-causality of historical development processes have been generated major socio-cultural problems, which would come to taken to the fore. The concept of ideal types excels as a tool of hinder capitalist long-run growth. He anticipated the decline of

232 233 Alexander Ebner Max Weber, the Protestant Ethics, and the Sociology of Capitalist Development capitalism due to the advent of an all-encompassing social bureauc­ tion of the Historical School of political economy. Methodologi­ ratisation that would finally result from the rationalisation of socio­ caily, this aspect is exemplified by the matter of concept formation economic affairs and beliefs in modern capitalism. The notion of in terms of Weber's use of the notion of ideal types and Verstehen the 'iron cage' would describe this fate of modern society- thus as means of analysing human action, which are said to reflect the putting Weber in line with cultural pessimists like Schumpeter, specific Neo-Kantian dimension of Weber's research methodology, who would view the economic success of capitalism as a source of especiaily regarding the impact of Rickert's methodological ideas. its socio-cultural decomposition (Swedberg 1998). In accounting Related to these considerations, it has been concluded that Weber for deterministic elements and underlying tendencies of a cultural intended to establish a generalizing social science as a methodo­ pessimism in these arguments, an allegedly Nietzschean sociology logical complement to both historiography and the natural sciences of fate in Weberian thought has been traced as a motivein the cor­ (Burger 1987). responding assessment of the developmental dynamism of Occi­ Weber's intellectual proximity to the Historical School is usually dental capitalism, pointing to the notion of the unintended conse­ illustrated with reference to this attempted integration of explana­ quences of social action as a characteristic of modern societies tory and interpretative approaches, which points to Weber's con­ (Turner 1996). In this Weberian line of reasoning, rationalisation cern with the methodological positions of contemporary scholars and secularisation are intertwined, with Protestantism and its ra­ like Roseher and Knies as weil as Rickert and Dilthey. Therefore, tionalising world-view as a decisive moment in the economic and derived from Max Weber's fierce opposition against both the political development of the Occident. More specifically, the Prot­ methodological positions of organicism and positivism, Weber's estant Ethics may be viewed both as a result as weil as a further original research program has been convincingly portrayed as an stimulus of a comprehensive rationalisation process. extension of German historism (Ringer 1997). In particular We­ Debating the intellectual status of Weberian thought, this interpre­ ber's approach to culture and modernity is said to reflect a socio­ tation has been subject to further controversies. Most prominently, logical and philosophical discourse- that is shaped by the sociologi­ Hennis dissents with that kind of reconstruction of Weberian cal varieties of originally historist concerns, as for instance pro­ thought as an analytical effort in theorising rationalisation, for he moted in Simmel's works on the philosophy of history as an often understands Weber's approach primarily as an effort in coming to neglected influence on Weber's theorising (Scaff 1989). Weber's terms with a specific science of man, based upon the role of ethical intellectual relations with his academic and political contemporar­ aspects in conditioning the cultural articulation of personality ies indeed involve a milieu of eminent historist German scholars which results after all in a theory of the development of mankind such as Gustav von Schmoller and Werner Sombart, among others, (Hennis 1988). Thus, the cultural dimension of individual behav­ but also historically-minded economists like Schumpeter (Shionoya iour is taken to the fore, perceived as a historically specific mani­ 1997, 2005). This is also in agreement with references to his mani­ festation of changing contextual settings. Appropriately, then, the fold political activities and public statements on political issues, as analytical implications of that perspective as weil as its methodo­ Weber has been portrayed as a specific brand of German liberal logical background are most generally supposed to resemble histor­ with nationalist leanings, who was open-minded for social reform ist traditions in the social sciences, especially in the German tradi- (Mommsen 1989).

234 235 Alexander Ebner Max Weber, the Protestant Ethics, and the Sociology of Capitalist Development

This historist orientation in the portrayal of the inteilectual refer­ lishing a capitalist system of market transactions and this promote ence points of Weberian ideas has been contested by critical the historically as weil as geographicaily unique emergence of claims, which tend to differentiate, modify or even reject the histor­ modern capitalism in Western Europe (Weber 192311991: 286- ist content of Weber's economic and political sociology. The latter 289). Weber argues against the misconceived claim that the ration­ line of reasoning is most prominent with Tribe, who suggests that alistic substance of modern capitalism involves a more accentuated the decisive inteilectual sources of Weberian ideas, as prevalent es­ outlook of economic interest than any other period in history. In­ pecially in his early works, belong primarily to the sphere of classi­ stead, Weber distinguishes between proper economic interests, cal political theory rather than to the allegedly ill-conceived which can be traced in ail societies past and present - be they capi­ framework of German historism (Tribe 1989). Referring to a talist, pre-capitalist, or non-capitalist - and a distinctly capitalist ar­ broader inteilectual context, the Weber-Durkheim relation in the ticulation of these kinds of interests, quite in line with the rational formation of modern sociology has been characterised by Giddens character of modern capitalism. In this setting, Weber also ac­ as contextual association and dissociation in terms of theoretical knowledges that market competition, the key area of capital accu­ approaches and historical context (Giddens 1987). Swedberg ac­ mulation, is to be perceived as an interest-driven process among cordingly portrays Max Weberas a founder and major representa­ conflicting parties (Weber 1923/1991: 239-240). tive of economic sociology, designed as a distinctly post-historist Although Weber highlights the cultural dimension of capitalism, he venture, which analyses economic institutions by means of socio­ does not neglect material factors as weil - as both spheres co­ logical concepts that focus on the matter of rational action, while evolve in space and time. Indeed, in Weber's view, the rise of capi­ highlighting the relationship between economy, polity, law, andre­ talism was related to favourable changes in the distribution of eco­ ligion. These topics have of course remained mostrelevant for cur­ nomic resources. Primarily, the expansion of markets for consumer rent research on the social embeddedness of economic life (Swed­ goods as weil as the introduction of new technologies allowed a berg 1998). Weber's analysis of the role of Protestantism in the lowering of prices, which fueiled capitalist economic relations. The evolution of modern capitalism thus belongs to a highly relevant latter are coined by the specific characteristics of rationality as a field of inquiry even in the context of economic sociology. socio-cultural paradigm with major behavioural connotations. To sort out the analytical specificities of Weber's reasoning on Above ail, this refers to the introduction of rational bookkeeping capitalist development, his work on general economic history, and capital accounting; two aspects, which help separating business based on the transcripts of lectures in 1919 and 1920, may be taken and household capital, and thus allow for continued and organised to the fore (Weber 1923/1991). This overview of social and eco­ capitalist accumulation. Also, the emergence of a rationally organ­ nomic history provides a comprehensive survey of economic de­ ized and formally free labour, which is treated like a commodity on velopment from ancient times to the modern capitalism. It ad­ markets, becomes a key feature of modern capitalism, paraileled by dresses the pattern of Western economic development, by claiming the development of rational law and administration in business that capitalist institutional forms always existed in history, yet it firms and state administration, which heralds the expansion of bu­ was only with the development of rational mechanisms like capital reaucracies in the public and private sectors (Weber 1923/1991: accounting and rational commerce, which would allow for estab- 302-4). After ail, these factors of capitalist development are mainly

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shaped by the particular role of Protestantism - although the influ­ attitude of a rational conduct of life as well as a professionally ra­ ence of Jewish beliefs as well as of Christianity in its Catholic and tionalised mode of business operation is historically rooted in the Lutheran manifestations is also to be acknowledged (Weber spirit of Christian asceticism, most visibly in Protestant profes­ 1923/1991: 312-314). Accordingly, this Weberthesis on Protestant sional asceticism, and here in particular in the diverse Protestant ethics as a driving force in the genesis of capitalist rationalisation is sects that share inner-worldly asceticism with the belief-system of to be viewed as the most essential component of Weber's more Calvinism as a specific institutional source of the capitalist genesis comprehensive sociology of capitalist development. in Western Europe and North America (Weber 1904-1905/1920: 202-204). Related modes of economic behaviour are defined by the 3. The Weber Thesis: Protestant Ethics in the Evolution expectation of profit through the realisation of exchange opportuni­ of Modem Capitalism ties, oriented at the capital account in a sustainably rational manner (Weber 1920a: 4-5). Thus, Weberclaims that 'capitalism is identi­ As outlined above, Weber approached the analysis of modern capi­ cal with the striving for profit, in continuous and rational capitalist talism by means of an exploration of its institutional foundations. enterprise: for an always renewed profit: for "profitability"' (Weber The study on the protestant ethic and the 'spirit of capitalism' - 1920a: 4). published under the title 'Die protestantische Ethik und der Geist In explaining the rise of capitalism in the Western world, Weber des Kapitalismus' in 1904 and 1905- excelled within that venture, accentuates that simple impulses to acquisition, the pursuit of gain, applied to modern capitalism as a historical individual, that is, as a the accumulation of monetary wealth, are not necessarily associ­ complex of relations in historical reality which are to be subsumed ated with capitalism. Indeed, the notion of unlimited greed for gain, categorically with regard to their cultural meaning (Weber 1904- which has been put forward as a key facet of capitalism by both 1905/1920: 30). In this study, Weber, who was a Protestant him­ Marxists and post-historist scholars such as Sombart, is not at all self, argues that the Protestant Reformation was critical to the rise identical with the rationale of modern capitalism. Viewed from a of capitalism through its impact on belief systems. Christian asceti­ comparative historical perspective, the desire for gain has been cism in general, and Calvinism in particular, promoted ideas such seen in all sorts of social and economic conditions. According to as the necessity of proving faith in worldly productive activities, Weber, even economic life of ancient Rome exhibited features of thus highlighting labour and rational conduct as manifestations of a capitalism, as defined by 'pure economic content', which applies divine 'calling'. Hence the spirit of capitalism is well described by when objects of property may be exchanged on markets by private the rational and ethical control of the drive for acquisition, as in agents to the end of acquisition (Weber 190911924: 15). Histori­ Calvinism, which propels the systematisation of acquisitive activi­ cally unique institutional features of Western capitalism are the ra­ ties (Weber 192111972: 378). tional capitalist organisation of formally free labour in the setting Weber's argument proceeds as follows. The rationalisation of la­ of a rational-capitalist organisation, paralleled by the separation of bour, law, organisation and accounting is framed by the emergence business from the household and the introduction of rational book­ of a specific capitalist spirit, which tends to shape economic and keeping as an accounting technique that allows for exact calcula­ social behaviour. Basically, this capitalist spirit, which denotes the tion (Weber 1920a: 7-8). Decisively, the ability to calculate is de-

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Alexander Ebner Max Weber, the Protestant Ethics, and the Sociology of Capitalist Development termined by the ability to rational action, unhampered by magical the entrepreneur represents the rational attitude of the modern pro­ beliefs. At this point, religion exercises a major impact on the de­ fessional, reflecting those aspects of the Protestant ethic which velopment of economic systems-andin the case of modern capi­ have contributed to the rationalisation of economic life and high­ talism, a most crucial facilitating role is played by a capitalist spirit lighting entrepreneurship as professional concern, also understood of rational calculation and conduct that is rooted in the ethics of as a religious duty (Weber 1904-1905/1920: 53-54). Rational con­ Protestantism with its inner-worldly ascetics (Weber 1904- duct of business corresponds to the rationalisation of other spheres 190511920: 61-62). of economic life that could Iead to the establishment of an 'iron

What makes Protestantism special? Weber suggests that religions cage of serfdom', that is an all-encompassing administrative system may be classified according to their acceptance or rejection of the of bureaucratic rule in which individuals were reduced to mere ob­ empirical world, that is, according to their degree of inner-worldly jects of administration - although the professional charisma of the orientation. In the case of acceptance, this goes together with the entrepreneur might provide an institutional antidote (Weber 1918 question of transforming, adapting, or escaping from the world. /1924: 506-507). However, Weber did not proceed with a further Calvin's doctrine of predestination and the notion of the 'calling' elaboration on the complex motives and behavioural dimensions of were essential for promoting a transfonnational attitude toward ra­ entrepreneurship. Thus, it has been suggested that his notion of en­ tional conduct, productive labour, and wealth accumulation. In­ trepreneurship resemble the 'character mask' of the Marxian capi­ deed, it is not the position Martin Luther and German Protestantism talist. Mommsen thus claimed that Weber described capitalism in in its Lutheranian blendbutthat of rather radical Protestant dissent­ an almost Marxian mode of argumentation, namely as an irresisti­ ers like Calvin which represents the essence of the Protestant ethics ble social force coercing men to subject themselves seemingly vol­ untarily to its social conditions (Mommsen 1974: 55). of capitalism. According to Calvin, individuals were predestined to salvation or damnation. Professional success served as a demon­ However, there is also a distinct organisational aspect of religious stration of a basically unknown fate, possibly in line with the divine affairs to be taken into account. Weber differentiates between 'calling'. In effect, this would promote an 'inner-worldly asceti­ churches such as the Catholic or Lutheran churches, which are la­ cism' with a focus on efficiency, possibly resulting in non­ belled as inclusive and voluntary organisations with a formal hier­ ostentatious wealth. archy in administration that is set to serve all believers within the

Weber even argues that the religious belief-system of the Protestant domain of the church. Sects that are rooted in Puritanism, such as sects actually came to fit to different professional occupations. For the Quakers, however, resemble exclusive and voluntary communi­ instance, Calvinists with their utilitarian attitude would exhibit ties that summon religiously qualified believers who are governed comparative advantages in becoming entrepreneurs (Weber 1904- by a peer network. The closely knit interaction within the social 190511920: 100-103). Accordingly, Weber pinpoints the matter of and economic communities of these sects has provided a Ievel of entrepreneurship as a representation of the capitalist spirit and its rule-following behaviour that was most conducive to the formation religious underpinnings. The Weberian entrepreneur is not merely a of market exchange in a rational, transparent setting of legal rules risk-taking adventurer or explorer, as Werner Sombart and other and social norms (Weber 1920b). Given the relative freedom from contemporary economists and sociologists would have it. Instead, governmental interference in North America, the local Protestant

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Alexander Ebner Max Weber, the Protestant Ethics, and the Sociology of Capitalist Development sects would thrive in their economic efforts that lay the foundations central the question of the uniqueness of Western capitalism and its of the institutional advantages of American capitalism (Noland developmental pattern. Ever since the 18th century, modern eco­ 2003). nomic growth has been an Occidental phenomenon, and it has been

Yet apart from his work on the Protestant ethics, Weber's sociol­ more rapid in Western Europe and its overseas colonies than in ogy of religion also encompasses comprehensive works on Juda­ other parts of the world. It remains an open question whether and ism, Hinduism, Buddhism, and Confucianism - with work on Islam how Protestantism contributed to modern economic growth - yet it still in progress at the time ofhis untimely death in 1920. As Weber is obvious that it occurred soon after most of these parts of the follows a non-deterministic line of reasoning, the genesis of Occi­ world experienced the advent of Protestantism. Second, Weber has dental capitalism needed to be explained by complex processes, pointed to the significant role of non-economic factors in driving which would not prevent the formation of distinct types of capital­ capitalist development. This applies in particular to the role of re­ ism in other parts of the world, and under other cultural and reli­ ligion and related world-views. Whether it is the Protestant legacy gious conditions. Judaism preceded the Christian religion -and its or other religionssuch as Catholicism or Judaism may not be deci­ driveforamaterial transformation of the world had been put for­ sive. From an analytical point of view, these historically inter­ ward as a key ingredient of the capitalist spirit by Weber's contem­ twined influences may be difficult to dissect. Decisively, however, porary Werner Sombart before. Weber, however, derives the rela­ as outlined in the foilowing section, even the critics of the Weber tive economic success of Western European Jews from their status thesis had to acknowledge the relevance of motivational and behav­ as a 'pariah' minority group that still lacked the spiritual connec­ ioural institutional conditions in the analysis of modern capitalism. tion between economic success and piety. Confucianism with its focus on harmoniously adaptive socio-natural relations was anti­ 4. Beyond the Weber Thesis: Critical Appraisals thetical to the rational dynamics of capitalism. Taoism Contradieted A critical appraisal of Max Weber's thesis on the Protestant ethics capitalism, because of its magic spiritualism and the encourage­ in capitalist development is weil advised to take off with paying ment of passive attitudes. While Hinduism and Buddhism pro­ reference to Weber's inteilectual context. Indeed, Weber's concerns moted asceticism, their escapist 'other-worldly' asceticism also did with the evolution of capitalism in Western Europe fit weil into the not lend to the support of capitalist institutions (Weber 1915- interests of the contemporary German Historical School in its post­ 191911920). Schmoilerian phase of analytical orientation that was based on the In summary, the relationship between the Protestant ethics and the concern with explaining the rise of modern capitalism, as repre­ evolution of modern capitalism remains constitutes a key compo­ sented most prominently by Werner Sombart. Actuaily, Weber's nent of Weber's sociology of capitalist development, which is major contribution to these debates is his study on the Protestant framed by even more comprehensive efforts of providing a unified ethic and the spirit of capitalism. In order to understand its argu­ social science that contains a sociological analysis of general eco­ mentation, a reconsideration of the related work of Werner Sombart nomic and social history of peoples and civilisations. The basic as weil as of preceding efforts by Gustav von Schmoiler is at hand. questions of Weber's researchprogram remain highly relevant, be­ Schmoller's historical perspective implied a reconsideration of in­ cause of two major reasons (Noland 2003). First, they have made stitutional factors in economic development by acknowledging the 242 243

Alexander Ebner Max Weber, the Protestant Ethics, and the Sociology of Capitalist Development plurality of individual motives that shape economic behaviour. dressing a coherent setting of economic spirit, organisation and Therefore, from the perspective of Schumpeterian economic soci­ technological dynamism (Sombart 1929: 14). Sombart applies this ology, it is said to demand an analysis of those factors that were scheme to the genesis and evolution of modern capitalism in West­ treated as data by conventional economic theory, principally insti­ ern Europe, by doing so paralleling as weil as stimulating Weber's tutional features like the behaviour of social groups and individuals corresponding efforts on the Protestant ethics. Indeed, Sombart (Schumpeter 1926: 17-18). Schmoller is also highlighted with his pinpoints the dimension of economic spirit as a characteristic and arguments against attempts of tracing the origins of modern capital­ driving force of capitalist evolution. According to Sombart, eco­ ism to the institutional features of certain historical periods, for he nomic spirit denotes the domain of motivation in driving economic is credited with realising fundamental identities under widely dif­ action, that is 'all the expressions of the intellect, all the character­ ferent cultural forms, as exemplified by the case of merchant guilds istics that become apparent in the course of economic activities', and industrial cartels (Schumpeter 1939: 228-229). Indeed, accompanied by 'all ambitions, all value judgements, all principles' Schmoller's institutional focus confronts materiaHst concepts that that shape the behaviour of economic agents (Sombart 191311988: were prominent with Marxian theory and, according to him, 12). seemed to exert an unwelcome influence on post-Schmollerian con­ tributions within the German Historical School, like those of Weher Derived from that definition, Sombart described the capitalist spirit, and Sombart, as expressed by the use of the notion of capitalism. which had already influenced the period of early capitalism since Schmoller actually argued that capital would indeed play a great the 13th century, as the 'Faustian spirit: the spirit of unrest, of rest­ role in the economy, but this should be explained psychologically, lessness', for it would contribute to the decomposition of estab­ lished routines, values and organic communities in favour of 'self­ accounting for the cultural context of the particular actors, involv­ interest' and 'self-determination' (Sombart 1916/1987: 327). In­ ing ideas and moral systems, customs and law, and other institu­ deed, the capitalist economic spirit should reflect ideas of acquisi­ tions (Schmoller 1903: 144). In this setting, the role of the Refor­ tion, competition and rationality that were also rooted in diverse re­ mation in the development process, apart from its influence on the ligious domains. Monetary acquisition represents the purpose of doctrine of natural law and the rationale of modern science, is economic activity. Accompanied by an attitude of competition, it linked to the connection between productive labour and religious becomes boundless - as means become ends in an infinite quest for piety, which is said to fuel the economic dynamism of Protestant economic progress, propelling the rationalisation of economy and nations-in particular the Germanie states (Schmoller 1901: 80). society (Sombart 1930: 196-197). The underlying ambiguity of the While Schmoller was a senior of Weber, his most influential con­ capitalist spirit is reflected by two constitutive components: an 'en­ temporary discussant was Werner Sombart, whose approach to trepreneurial spirit' based on a drive for unlimited acquisition, con­ capitalist development reflected Schmoller's concern with histori­ quering and the will for power on the one hand, and a 'bourgeois cal studies, while continuously acknowledging the complementing spirit' of rational order, careful calculation and exact accounting on achievements of the Marxian perspective (Backhaus 1989). His no­ the other hand (Sombart 1916/1987: 329-330). However, in the pe­ tion of 'economic systems' should conceptualise the essential his­ riod of 'high capitalism', entrepreneurial motivation becomes de­ torical forms and institutional features of economic processes, ad- void of religious motives and customary bonds beyond bourgeois

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Alexander Ebner Max Weber, the Protestant Ethics, and the Sociology of Capitalist Development morals as the capitalist spirit is fully secularised (Sombart different argumentation than Sombart (Ebner 2003). Indeed, in con­ 1927/1987: 30-31). Finally, that capitalist spirit erodes completely, trast to both Weber and Sombart, Schumpeter claims that there is giving way to the rationalised atmosphere of 'bureaucratised capi­ no distinct spirit of capitalism in the sense of a new way of think­ talism' (Sombart 192711987: 806). ing, which would have emerged in the context of the transforma­ tion of feudalism. Instead, every economic system is based on a va­ In this process of capitalist development, the role of religion is im­ riety of institutional forms that allow for its evolutionary self­ portant as an intellectual and spiritual force that shapes the contours transformation (Schumpeter 1954: 80-81). Capitalism thus evolved of the capitalist spirit. However, Sombart disagree with Weber's from the socio-cultural substance of preceding forms of economic emphasis on Protestantism as a religious force in capitalism - also organisation, based on institutional elements that were cumula­ because Sombart's view of capitalism is less biased towards the tively growing in influence. Resembling the principle of historical matter of socio-cultural rationalisation and more open for the idea continuity as a perspective on economic development, Schumpeter of unlimited acquisition as a motivational paradigm. Sombart's suggests that there is no logically autonomaus problern of the birth monograph on the role of the Jews in economic life is therefore of capitalism in terms of an outhurst of economic activity of a new meant to refute Weber's thesis on the Protestant ethics. Indeed, type- as claimed by Weber (Schumpeter 1939: 228). As Schum­ Sombart claims that the dominating ideas of Puritanism, which peter defines capitalism as private property economy in which in­ were so powerful in promoting the spirit of modern capitalism, novations are carried out by means of borrowed money, it follows werein fact more perfectly developed in Judaism, and were thus al­ that the historical dating of capitalism should depend on the emer­ so of a much earlier date. Altogether, Sombart suggests that Puritan gence of institutional mechanism of credit creation, to be traced in doctrines were deduced from Jewish sources that would combine Southern Europe at least since the 12th century (Schumpeter 1939: the drive for an unlimited accumulation of wealth with a socially 223-224). Therefore Sombart's idea ofthe advent of a distinct capi­ codified dynarnism of inclusion (Sombart 1911). Furthermore, talist spirit since the 15th century is dismissed, together with We­ Sombart directly rejects the Weberian line of reasoning on Protes­ ber's concept of a specific type ofrationality, rooted in Protestant tantism and capitalism when he states most clearly in his work 'Der ethics, as a formula denoting the capitalist spirit (Schumpeter 1939: Bourgeois', which deals with the diverse intellectual sources of the 228-229). This argumentationalso includes a critique of the Webe­ capitalist spirit, that Protestant sects have historically exercised a rian argument of a transition from an ideal typical 'feudal man' to a pronounced antic-capitalist stance, while the Lutheran tradition in 'capitalist man', for this scheme seems to misrepresent the evolu­ Germany represents a pre-capitalist, craft-based value system that tionary character of the historical transition process of economies exhibits a decidedly anti-capitalist orientation (Sombart 1913/1988: and societies (Schumpeter 1954: 80). 244-245). In effect, then, Sombart's more encompassing view of modern capitalism also allows foramorediverse line of reasoning More specifically, with a nod to the Weberian argumentation, when it comes to the identification of its religious and ethical Schumpeter points out that the specific feature of rising capitalism sources. lie in developing the institutional aspects of rationality in two ways. First, money becomes a unit of account and thus serves the practice Joseph Schumpeter isanother intellectual contemporary of Weber, of cost calculation, promoting a 'spirit of rationalist individualism'. who joins in the criticism of the Protestant ethics thesis, yet with a

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Second, the mental attitudes of modern science as weil as the whereas the Protestant Reformation just gave rise to another take­ means of its exploitation are promoted by that type of rationality, off (Coilins 1986: 76). Accordingly, Weber is repeatedly attacked fuelling scientific and technological progress as an endogenaus fac­ for misrepresenting both Protestantism and Catholicism, thus con­ tor in the capitalist process. Even cultural spheres are subjugated to fusing the historical record with respect to the rise of capitalism in that hegemonic rationality with its drive for quantification and ra­ Catholic and Protestant areas (Kaufmann 1997, Iannaccone 1998). tionalisation (Schumpeter 1942: 123-124). As the institutional or­ Nonetheless, even though historical evidence may put some pres­ der of capitalism is supported by pre-capitalist institutional patterns sure on the Weberian thesis, it still stimulates major efforts in theo­ and social strata, their decomposition heralds the final decline of rising on the relationship between religion and economic develop­ capitalism and its socialist transformation (Schumpeter 1942: 131- ment. From a rational choice perspective, for instance, the Weber 133). In this context, the matter of religion is for Schumpeter, a thesis has been reiterated by claiming that political-economic com­ stauneh Catholic, less important than for Weber and Sombart. This petition in Western Europe in effect created market space for new is primarily due to Schumpeter's refutation of the notion of a his­ entrants- namely the Protestantreformers- who rapidly gained ra­ torically specific capitalist spirit that would be fueiled by distinct tionaily switched ailegiances (Ekelund, Hebert, and Tollison 2002). religious world-views. Moreover, when it comes to the formation Furthermore, an interpretation of the Weber thesis in terms of evo­ of individualism and modern rationality, Schumpeter denies Protes­ lutionary game theory comes up with the argument that the Calvin­ tantism a key role. Instead, he claims that individualism and ration­ ist doctrine of predestination increased the cost of contractual de­ alism began in Catholic thought, in particular with Duns Scotus and fection, thus driving Protestant contract compliance. The resulting Aquinas (Schumpeter 1954: 91-92). spread of information networks in the Protestant lands then gener­ It is noteworthy that the international discussion on the Weberian ated externalities that promoted the rise of industrial capitalism thesis has foilowed a similar direction. Among the most prominent (Blum and Dudley 2001). This viewpoint is line with empirical Ob­ critics is R. H. Tawney, who alters Weber's argument by emphasis­ servations which portray Catholicism as a 'hierarchical' religion ing the declining influence of the Roman Catholic Church as a that obstructs societal trust and comes together with less efficient condition of capitalist rationalisation while pinpointing the aspect judiciaries, greater corruption, lower-quality bureaucracies, lower that Calvinist thought still obstructed market freedom in modern rates of civic participation, inferior infrastructures, and higher infla­ sense (Tawney 1926: 178-179). H. M. Robertson also stresses that tion (La Porta et al., 1997: 336-337). Of course, one should be cau­ capitalism emerged already in 14th-century Northern ltalian city tious about the causalities implied in these results. Yet it is com­ states, which were obviously Catholic areas (Robertson 1933). monly understood in regressions on economic performance that the These concerns are echoed in later debates, as for instance in Dee­ hypothesis according to which the coefficients on variables of reli­ pak Lai's suggestion that most fundamental institutional innova­ gious affiliation are jointly equal to zero can frequently be rejected, tions were occurring in Europe centuries weil before the Reforma­ although no robust relationship between adherence to major world tion (Lai 1998). Randall Coilins summarises this criticism with the religions and national economic performance has been uneavered claim that Christendom was the main Weberian revolution that cre­ so far (Barro and McCleary 2002, 2003). Accordingly, the Weber ated the institutional forms within which capitalism could emerge,

248 249 Alexander Ebner Max Weber, the Protestant Ethics, and the Sociology of Capitalist Development thesis remains relevant, not only in a historical perspective, but also References with regard to current economic and social affairs. Backhaus, J. (1989), Wemer Sombarts Konjunkturtheorie, in B. Schefold 5. Conclusion (ed.) Studien zur Entwicklung der ökonomischen Theorie, Vol.VII, Berlin: Duncker und Humblot, pp.77-98.

As outlined above, the Weber thesis on the Protestant ethics may be Barro, R.J. and R.M. McCleary (2002), Religion and Political Economy deficient with regard to its historical-empirical underpinnings, yet in an International Panel, NBER Warking Paper No.8931, Cam­ its concern with the institutional foundations of capitalist develop­ bridge: National Bureau of Economic Research. ment remains relevant for current debates. Indeed, Weber's sociol­ Barro, R.J. and R.M. McCleary (2003), Religion and Economic Growth," ogy of capitalism, with its broad historical, geographical and intel­ NBER Warking Paper No.9682, Cambridge: National Bureau of lectual range, is once more central to the discussion of the past, Economic Research. present and future of modern capitalism. Three fields of study may Blum, U. and L. Dudley (2001), Religion and Economic Growth: Was be particularly relevant when it comes to applications of Weberian Weber Right?, Journal of Evolutionary Economics, Vol.ll, No.2, themes to current issues. First, the matter of globalisation and the pp.207-30. 'clash of cultures', as Huntington had it, which is particularly rele­ vant for Weberian concerns when it comes to the rise of China - Burger, T. (1987), Max Weber's Theory of Concept Formation: History, Laws, and Ideal Types, Durham: Duke University Press. and East Asia at large. This brings to mind Weber's dieturn that Chinese capitalism may be possible, yet that it would Iook entirely Collins, R. (1986), Weberian Sociological Theory, Cambridge: Cam­ different as compared with the Western model. Second, the socio­ bridge University Press. cultural conditions for overcoming underdevelopment may be a Ebner, A. (2003) The Institutional Analysis of Entrepreneurship: Historist fruitful domain of application, given the discourse on good govern­ Aspects of Schumpeter's Development Theory, in J.G. Backhaus ance in the face of the fact that both market and state failure are en­ (ed.), Joseph Alois Schumpeter: Entrepreneurship, Style and Vision, demic in the developing world. Third, the Weberian notion of ra­ Boston: Kluwer, pp.117-139. tionality in the capitalist spirit may be applied to the current turmoil Ekelund, R.B. Jr., R.F. Hebert and R.D. Tollison (2002), An Economic in the global financial markets. The financial crisis has uncovered Analysis of the Protestant Reformation, Journal of Political Econ- major inefficiencies - and irrationalities - in the set-up of global omy, Vol.llO, No.3, pp.646-671. markets, which seem to contradict the ethos of rational conduct that Giddens, A. (1987), Weberand Durkheim: Coincidence and Divergence, was underlined by Weber. After all, Max Weber was explicit in his in W.J. Mommsen and J. Osterhammel (eds.), Max Weberand His position that the institutional evolution of modern capitalism was a Contemporaries, London: Allen and Unwin, pp.182-189. path-dependent, undetermined process. This is also a way of stress­ ing the relevance of the Weberian legacy in the social sciences. Hennis, W. (1988), Max Weber: Essays in Reconstruction, London: Un­ winHyman.

Iannaccone, L.R. (1998), lntroduction to the Economics of Religion, Journal of Economic Literature, Vol.36, No.3, pp.1465-1196.

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