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This response shows that, in their reply to my critique of their work, Ben Fine and Dimitris Milonakis generally maintain the impression that there is a single, widely accepted definition of methodological individualism, but they do not identify it. They assert that social structures (undefined but seemingly specified to exclude law and institutions) have ‘analytical priority’ and logically (but tacitly) imply that individuals should have no part in the analysis of social or economic phenomena. They mischaracterise Hodgson's (2011) position on Marshall by quoting just one part-sentence out of context. Fine, Milonakis and Hodgson agree that the intellectual roots of the predominance of technique over substance in modern economics can partly be traced to the 1870–1900 period, but disagree on what they are. [ABSTRACT FROM AUTHOR]

In their recent analysis of the alleged decay in modern economics, Ben Fine and Dimitris Milonakis claim to find its source and origin in the 'marginal revolution' of the 1870s. They argue that this development led to 'methodological individualism' and the detachment of economics from society and history. I contest their account of the marginal revolution and of the role of Alfred Marshall among others. They also fail to provide an adequate definition of methodological individualism. I suggest that neoclassical economics adopted a denuded concept of the social rather than removing these factors entirely. No such removal is possible in principle. It is also mistaken to depict neoclassical economics as the science of prices and the market. In truth, neoclassical economics fails to capture the true nature of markets. I consider some sketch an alternative explanation of the sickness of modern economics, which focuses on institutional developments since World War II. [ABSTRACT FROM AUTHOR]

Advocacy of 'methodological individualism' is widespread, especially among economists. However, the term is rarely defined with adequate precision and some crucial ambiguities are explored in this article. Among these is the commonplace ambivalence over whether explanations should be in terms of individuals alone, or in terms of individuals plus relations between them. It is shown that a great deal hinges on this subtle and often overlooked distinction in explanantia. In particular, explanations in terms of individuals alone have never, as yet, been achieved. Furthermore, the more feasible version of explanations in terms of individuals plus relations between them amounts to the introduction of social structure alongside individuals in the explanantia. Serious questions remain whether this version warrants the one-sided emphasis on individuals in the term 'methodological individualism'. JEL Classifications: B20, B40, B41 [ABSTRACT FROM AUTHOR]

With a predilection for market solutions, neoliberalism upholds that the individual is generally the best judge of his or her interests. Yet markets are never universally applied as a mechanism of allocation and there are reasons, in principle, why capitalism will always have “missing markets.” Concentrating on the application and appropriateness of neoliberal theory to the workplace, this article argues that firms are not markets, despite some tendencies in modern theory to conflate the two. The employment contract is a key characteristic of modern firms, but neoliberal theory is often silent on the distinction between an employment contract and a contract for services, and largely ignores the asymmetrical rights of authority within contracts of employment. Furthermore, the social nature of knowledge represents a challenge to neoliberal theory and policy, because it sometimes makes it more difficult to define individual property rights. Accordingly, with the growth of the knowledge economy, neoliberalism to some extent is an anachronism. [ABSTRACT FROM AUTHOR]