The contemporary social science in general and economics in particular are dominated by the method of logical positivism in the British tradition. In contrast to the British philosophy, ‘Subjectivism and Interpretative Methodology in Theory and Practice’ adopts subjectivism and interpretation methodology to understand human behavior and social action.

Unlike positivism, this subjectivist approach, with its root in German idealism, takes human experience as the sole foundation of factual knowledge. All objective facts have to be interpreted and evaluated by human minds. In this approach, experience, knowledge, expectation, plans, errors and revision of plans are key elements.

Specifically, this volume uses the subjectivist approach originated in Max Weber’s interpretation method, Alfred Schutz’s phenomenology, and Peter Berger and Thomas Luckmann’s sociology of knowledge to understand economic and social phenomena. The method brings human agency back into the forefront of analysis, adding new insights not only in economics and management, but also in sociology, politics, psychology and organizational behavior.

Fu-Lai Tony Yu is professor of economics at Hong Kong Shue Yan University. He obtained his PhD from the University of New South Wales and has taught at Hong Kong Baptist University; Hong Kong Polytechnic University; Monash University, Australia; and Feng Chia University, Taiwan. Yu’s research interests include international political economy, entrepreneurship, economic development, governmental economics, Austrian economics and Asian business systems.

List of Illustrations; Preface; Acknowledgements; Introduction; 1. Methodological Subjectivism and Interpretive Approach in Political Economy; Part 1 Some Theoretical Issues; 2. Subjectivism in the Austrian School of Economics (with Gary M. Shiu); 3. Frank H. Knight’s Thought Revisited: Subjectivism, Interpretation and Social Economics; 4. Two Perspectives of Time in Economics: The Orthodox Neoclassical School (Newtonian) versus the Austrian School (Bergsonian); 5. Human Action and Coordination in Two Subjectivist Perspectives; 6. Subjectivism, Understanding and the Transaction Costs Paradigm; Part 2 Applications; 7. Blowing a Breath of Life into the Firm: Toward a Lachmannian Perspective of the Firm; 8. Expectation, Subjective Time Preference and Business Cycles; 9. Toward a Theory of Social Construction of National Identity (with Diana S. Kwan); 10. Novelty and Intersubjective Communication: From Denial to Acceptance of Vincent van Gogh’s Paintings; 11. The Sinking of the Unsinkable Titanic: Mental Inertia and Coordination Failures; 12. A Subjectivist Approach to Advertising: The Case of Vitasoy in Hong Kong (with Diana S. Kwan); 13. Outcomes-Based Education: A Subjectivist Critique; Index.

“Tony Yu is one of today’s most thoroughgoing exponents of interpretive methodology and the subjective approach to economics. This wide-ranging collection showcases the diversity of phenomena to which, in his hands, this set of ideas can be applied—up to and including the painting of Vincent van Gogh and the sinking of the Titanic.” —Richard N. Langlois, Professor of Economics, University of Connecticut, USA

“Subjectivism and Interpretative Methodology in Theory and Practice by Tony Yu significantly pushes forward the subjectivist research program in both applied and theoretical directions. The economist, organizational scholar, political scientist and sociologist who take the study of the firm, purposive human action, innovation and learning seriously will greatly benefit from it.” —Giampaolo Garzarelli, Associate Professor, Department of Social and Economic Sciences, Sapienza Università di Roma, Italy