Wednesday, July 03, 2013

Reading :: Economy and Society

Economy and Society: An Outline of Interpretive Sociology (2 volume set)
By Max Weber


I've been putting off this review for a while because I suspect it will be long. Here's the two-volume set with my notes:


The set is 1469pp. To provide some perspective, that's still fewer pages than two Harry Potter books. But then again, I have never attempted to read two Harry Potter books. They don't sound nearly as interesting as Weber.

What interested me about Weber was that, beyond being counted as one of the founders of sociology, he is also known for his writings on bureaucracy. That's particularly true in Adler and Heckscher's work, which draws on Weber and Tonnies to theorize collaborative community. And since I'm working on characterizing different types of organizations, I knew that at some point I'd have to work my way through Weber.

Weber discusses far more than bureaucracies, of course. Economy and Society covers basic sociological terms and concepts; describes relationships between the economy and normative and de facto powers; describes relationships between economy and law; discusses types of political communities; and outlines different kinds of domination. That's a lot to cover, and Weber covers it ably, drawing on a remarkable array of fields to make his case.

Volume 1
According to the editors, Weber actually wrote Volume 1 second. But he puts it first to define terms and concepts. Volume 1 doesn't have much of a plot, but it establishes the foundation for Volume 2.

Weber starts by carefully laying out some of his basic terms, such as sociology ("a science concerning itself with the interpretive understanding of social action and thereby with a causal explanation of its course and consequences," p.4) and meaning (not as something objectively correct or metaphysically true, but as either "the actual existing meaning in the given concrete case of a particular actor, or to the average or approximate meaning attributable to a given plurality of actors" or a pure type thereof, p.4). Weber describes his approach as a comparative methodology which compares the pure type of rational action and deviations from it (p.6). Social action he defines as action oriented to others' behavior (p.22); it can be oriented in four ways: instrumentally rational, value-rational, affectual, and traditional (pp.24-25). Typically social action is multiply oriented (p.26). Social relationship is "the behavior of a plurality of actors insofar as, in its meaningful context, the action of each takes account of that of the others and is oriented in these terms" (p.26).

Moving on, Weber discusses types of legitimate order, divided into two types: convention and law (p.33). The legitimacy of an order may be guaranteed, he says, in two ways. One is "purely subjective": affectual, value-rational, or religious. The other is "by the expectation of specific, external effects, that is, by interest situations" (p.33), including convention and law. Convention denotes an order whose "validity is externally guaranteed by the probability that deviation from it within a given social group will result in a relatively general and practically significant reaction of disapproval," while law denotes an order that is "externally guaranteed by the probability that physical or psychological coercion will be applied by a staff of people in order to bring about compliance or avenge violation" (p.34). This distinction becomes important later on.

Social relationships can be characterized as conflict (carrying out one's will against the resistance of others), competition (a formally peaceful attempt to gain control over opportunities and advantages that others also want), or selection (an often-latent struggle for advantage or survival, but without a mutual orientation) (p.38).

Social relationships can also be characterized as communal (when individuals' social orientation is based on the feeling that they belong together) or associative (when the social alliance is based on a "rationally motivated adjustment of interests or a similarly motivated agreement" (pp.40-41). For instance, market relationships are associative; so are relationships based on a shared belief in certain absolute values (p.41). But religious brotherhoods, erotic relationships, personal loyalty, and esprit de corps are associative (p.41). Of course, these are ideal types; as Weber points out, even merchants often like their customers (p.41).

Social relationships can be characterized as open to outsiders (if "its system of order does not deny participation to anyone who wishes to join and is actually in a position to do so") or closed to them (if "participation of certain persons is excluded, limited, or subjected to conditions") (p.43).

An organization is "A social relationship which is either closed or limits the admission of outsiders ... [and] its regulations are enforced by specific individuals: a chief and, possibly, an administrative staff, which normally also have representative powers" (p.48). Organizations are autonomous (governed by an order the members themselves established) or heteronomous (governed by an order imposed from outside), autocephalous (with chief and staff selected by the autonomous order) or heterocephalous (with chief and staff appointed by outsiders) (pp.49-50). Weber draws several other distinctions to characterize organizations; we'll skip a bit.

Weber now defines power ("the probability that one actor within a social relationship will be in a position to carry out his own will despite resistance, regardless of the basis on which this probability rests", p.53) and domination ("the probability that a command with a given specific content will be obeyed by a given group of persons," p.53). He distinguishes between political organizations (safeguarding an order in territory via physical force), the state (which enjoys a monopoly of the legitimate use of physical force), and hierocratic organizations (which safeguard order via psychic coercion), including the church (which enjoys a monopoly on hierocratic coercion) (p.54).

With this groundwork out of the way, Weber goes on to discuss the division of labor, providing a discussion that is encyclopedic, although not as broadly applied as Durkheim's, and then discusses occupations.

In chapter 3, Weber gets to the types of legitimate domination. Every genuine form of dominance, he argues, implies an interest in obedience (i.e., voluntary compliance) (p.212). Dominance via purely material interests tends to be unstable, he says, so that dominance is typically supplemented by "other elements, affectual and ideal" (p.213). Every system of domination cultivates belief in its legitimacy (p.213).

Weber names three types of legitimate domination—and these three types show up frequently in the rest of the two volumes of Economy and Society. (This discussion reminded me of Machiavelli's Discourses in its careful delineation and description of types, though Machiavelli was talking about governments and Weber is talking about broader issues of legitimacy.) Claims of legitimacy can be based on:

  • Rational grounds (legal authority). This type underpins bureaucracies.
  • Traditional grounds (traditional authority). 
  • Charismatic grounds (charismatic authority). (p.215). 
Rational grounds
Legal authority, based on rational grounds, organizes its offices via hierarchy (p.218). It especially uses that most unambiguous structure of domination, the bureaucracy (p.219). Bureaucrats are appointed, not elected (p.221). The monocratic bureaucracy 
is, from a purely technical point of view, capable of attaining the highest degree of efficiency and is in this sense formally the most rational known means of exercising authority over human beings. It is superior to any other form in precision, in stability, in the stringency of its discipline, and in its reliability. It thus makes possible a particularly high degree of calculability of results for the heads of the organization and from those acting in relation to it. It is finally superior both in intensive efficiency and in the scope of its operations, and is formally capable of application to all kinds of administrative tasks. (p.223)
 (Compare Mintzberg on the advantages of bureaucracy.)

Bureaucracy, Weber adds, is supported by "extremely important conditions in the fields of communication and transportation. The precision of its functioning requires the services of the railway, the telegraph, and the telephone, and becomes increasingly dependent on them" (p.224). That is, communication and transportation technologies create the conditions under which bureaucracies can flourish. After all, "Bureaucratic administration means fundamentally domination through knowledge," including both "technical knowledge" and "knowledge growing out of experience in the service" (p.225).

Bureaucratic domination results in (1) "'leveling' in the interest of the broadest possible basis of recruitment in terms of technical competence"; (2) "the tendency to plutocracy growing out of the interest in the greatest possible length of technical training"; and (3) "the dominance of a spirit of formalistic impersonality," in which "the dominant norms are concepts of straightforward duty without regard to personal considerations" (p.225). Bureaucracy leads to social leveling, Weber says, so "everywhere bureaucratization foreshadows mass democracy" (p.226). In sum, bureaucratic authority has the characteristics of (1) formalism and (2) utilitarianism "in the interest of the welfare of those under their authority" (p.226).

Traditional grounds
"Authority will be called traditional if legitimacy is claimed for it and believed in by virtue of the sanctity of age-old rules and powers" (p.226). Rules are obeyed due to their traditional status. In the simplest case, it can be based in personal loyalty from a common upbringing. Obedience is owed to the person, not the rules (p.227). Commands are legitimized in terms of "action which is bound to specific traditions" and by "action which is free of specific rules," falling within a sphere of discretion (p.227). Pure traditional authority lacks things that we associate with bureaucracy: "a rationally established hierarchy," "a regular system of appointment on the basis of free contract," "technical training as a regular requirement," and "fixed salaries" (p.229).

Charismatic grounds
"The term 'charisma' will be applied to a certain quality of an individual personality by virtue of which he is considered extraordinary and treated with supernatural, superhuman, or at least specifically exceptional powers or qualities" (p.241). "There is no hierarchy; the leader merely intervenes in general or in individual cases when he considers the members of his staff lacking in charismatic qualification for a given task" (p.243). Charismatic authority, of course, cannot remain stable (p.246). In being routinized, it can easily turn into a "clan state," in which "a political body is organized strictly and completely in terms of this principle of hereditary charisma. ... The heads of families, which are traditional geronotocrats or patriarchs without personal charismatic legitimacy, regulate the exercise of these powers which cannot be taken away from their family" (p.250).

Combinations
But of course these pure types are rare. In most cases, legitimization comes from combinations of different types of authority (p.262). Weber reminds us that "at the basis of every authority, and correspondingly of every kinds of willingness to obey, is a belief, a belief by virtue of which persons exercising authority are lent prestige" (p.263).

For instance, Weber argues that "when the charismatic organization undergoes progressive rationalization ... it is treated as the basis of legitimacy: democratic legitimacy. ... The personally legitimated charismatic leader becomes leader by the grace of those who follow him since the latter are formally free to elect and even to depose him—just as the loss of charisma and its efficacy had involved the loss of genuine legitimacy. Now he is the freely elected leader" (p.267).

Legal and economic order
Skipping a bit, we get to Weber's famous observation that "today legal coercion by violence is the monopoly of the state. All other groups applying legal coercion by violence are today considered as heteronomous and mostly as heterocephalous" (p.314).

In the latter half of Volume 1, Weber discusses the economy and the arena of normative and de facto powers. Let's skip this discussion and get to Volume 2.

Volume 2
Volume 2 covers economy and law; political communities; domination and legitimacy; bureaucracy; patriarchalism and patrimonialism; feudalism; charisma and its transformation; political and hierocratic domination; and the city.

Let's skip to political communities.

Political communities
"The term 'political community' shall apply to a community whose social action is aimed at subordinating to orderly domination by the participants a 'territory' and the conduct of the persons within it, through readiness to resort to physical force, including normally force of arms" (p.901). "A separate 'political' community is constituted where we find (1) a 'territory'; (2) the availability of physical force for its domination; and (3) social action which is not restricted exclusively to the satisfaction of common economic needs in the frame of a communal economy" (p.902). The belief in political legitimacy leads to the aforementioned principle that only states can legitimately exercise physical coercion (p.904). This monopoly of violence is a product of evolution. Basic state functions are lacking or irrational under primitive conditions, Weber argues; instead, they are performed by ad hoc groups or distributed across a variety of groups (p.905).

Bureaucracy
Bureaucracy has the following characteristics:

  • Regular activities are assigned as official duties.
  • The authority to give the commands is distributed in a stable way and strictly delimited.
  • Only persons who qualify under general rules can be employed to fulfill regular duties and exercise the corresponding rights. (p.956)
An office hierarchy involves a system of super- and subordination, a possibility of appeal, and a monocratic organization. It's based on written documents (p.957). Offices are specialized and "when fully developed, official activity demands the full working capacity of the official, irrespective of the fact that the length of his obligatory working hours in the bureau may be limited" (p.958). "The management of the office follows general rules, which are more or less stable, more or less exhaustive, and which are learned. Knowledge of these rules represents a special technical expertise which the officials possess" (p.958). And "The reduction of modern office management to rules is deeply embedded in its very nature" (p.958). 

Office holding is a vocation with a "prescribed course of training, which demands the entire working capacity for a long period of time, and in generally prescribed special examinations and prerequisites of employment" (pp. 958-959). The official's position is considered a "duty" (p.959). "Entrance into an office, including one in the private economy, is considered an acceptance of a specific duty of fealty to the purpose of the office" (p.959). The office doesn't establish a relation to a person but to impersonal and functional purposes (p.959). 

Office holding also involves fixed career lines: the official moves from lower, less well paid levels of the hierarchy to higher, more well paid ones. A lifelong career is assumed, and promotion is based on seniority (p.963), itself corresponding (theoretically) to expertise. 

Bureaucracy is tied to the presupposition of continuous revenues to maintain it (p.968). 

Modern communications, Weber argues, are the "pacemakers of bureaucratization": he lists "public roads and water-ways, railroads, the telegraph, etc.,"which "can only be administered publicly" (p.973). These also sustain and grow the bureaucracy: Egypt's early bureaucracy, he argues, could not have developed were it not for the Nile (p.973). 

Bureaucracies are technically superior to administration by notables:
The decisive reason for the advance of bureaucratic organization has always been its purely technical superiority over any other form of organization. The fully developed bureaucratic apparatus compares with other organizations exactly as does the machine with the non-mechanical modes of production. Precision, speed, unambiguity, knowledge of the files, continuity, discretion, unity, strict subordination, reduction of friction and of material and personal costs—these are raised to the optimum point in the strictly bureaucratic administration, and particularly in the monocratic form. (p.973)
 And that's why
today, it is primarily the capitalist market economy which demands that the official business of public administration be discharged precisely, unambiguously, continuously, and with as much speed as possible. Normally, the very large modern capitalist interprises are themselves unequalled models of strict bureaucratic organization. Business management throughout rests on increasing precision, steadiness, and above all, speed of operations. This, in turn, is determined by the peculiar nature of the modern means of communication, including, among other things, the news service of the press. The extraordinary increase in the speed by which public announcements, as well as economic and political facts, are transmitted exerts a steady and sharp pressure in the direction of speeding up the tempo of administrative reaction towards various situations. The optimum of such reaction time is normally attained only by a strictly bureaucratic organization. (p.974). 
The most important element for the modern bureaucracy, he says, is calculable rules (p.975). (Compare Boisot on abstraction, codification, and diffusion.)  Indeed, he says, "bureaucracy develops the more perfectly, the more it is 'dehumanized'" (p.975).

Bureaucracy also implies centralization: "the bureaucratic structure goes hand in hand with the concentration of the material means of management in the hands of the master" (p.980).

Bureaucracy, as Weber raised earlier, accompanies modern mass democracy (p.983). It is hard to destroy because it provides the means of transforming social action into rationally organized action; indeed, "when administration has been completely bureaucratized, the resulting system of domination is practically indestructible" (p.987). Through that system, the bureaucrat is chained to his activity (p.988). "Increasingly, all order in public and private organizations is dependent on the system of files and the discipline of officialdom, that means, its habit of painstaking obedience within its wonted sphere of action" (p.988). And Weber saw new forms of communication technology as making new formations of authority more impossible (p.989).

Bureaucracies also compartmentalize. In bureaucracies, people tend to keep knowledge and intentions secret, making the insider superior (p.992).

Weber says that the bureaucracy has destroyed structures of domination which were not rational (p.1003).

Patriarchalism and Patrimonialism
One of those structures was patriarchalism and its offshoot, patrimonialism. Patriarchal domination is based on strictly personal loyalty through tradition. It can be dominated by honoratiores, in which social honor (prestige) becomes the basis for domination, and in its pure form, patriarchal domination has no legal limits (p.1009). In this case, the master's security and maintenance depend on the basic attitudes and morale of subjects (p.1011).

Patrimonial domination is a special case of patriarchal domination: "domestic authority decentralized through assignment of land and sometimes equipment to sons of the house or other dependents" (p.1011). Patrimonial office lacks the bureaucratic separation of private and official spheres (p.1028).

Feudalism
The patrimonial estate led to the contractual allegiance of feudatory relationships (p.1070). Here, the personal duty of fealty has been isolated from household loyalties (p.1070). Indeed, the vassal could later take a fief from several lords, making his support precarious during a given conflict (p.1085).

Charisma and its transformation
Bureaucracy and patriarchalism, Weber says, share one important characteristic despite their differences: continuity. Indeed, bureaucracy is considered the rational counterpart of patriarchalism, with its permanent structure and satisfaction of calculated needs. But charisma is different: it addresses extraordinary needs that "transcend the sphere of everyday economic routines" (p.1111). Under these conditions, "the 'charisma of rhetoric' gains great influence" (p.1129).

But as noted earlier, charismatic domination is unstable. Eventually parties form, dominated by bureaucracy, which as we saw is associated with mass democracy. So charisma is "castrated" by party organization (p.1132), leveraged in mass democracy but under the control of party bureaucracy and dependent for its effectiveness on the nonpartisan bureaucracy that keeps the government working.

But that happens over a length of time. Before that, charisma can be transformed by being depersonalized and transferred (p.1135). "The charisma of the ruler attaches to his house," leading to the "clan state" in which "the rights of the individual lineage groups to their functions are legitimated by the charisma inherent in their houses, not by any personal fealty" (pp.1136-1137).

Let's stop there. Weber's work is much more far-reaching than this summary can address, and as I intimated earlier, it doesn't have the linear plot that, say, a Harry Potter novel might. But I've attempted to pull out some of the most interesting and salient details for thinking through how organizations work—and how communication technologies influence them. Think of the review as a warm-up for when you read these two volumes yourself—as you really should.

1 comment:

David Ronfeldt said...

for me, another valuable write-up, clay. many thanks from here.

lots of material for TIMN, esp the +I part. also, apropos T+I, i've used the term "clan state before, but had no knowledge (or had long forgotten) that weber fielded the term.

onward.