To Western scholars and intellectuals in the nineteenth century, the single development that dominated all else in their world was the extraordinary expansion of capitalism. As Marx had quite correctly observed, capitalism was the most revolutionary force ever let loose on the world. It invaded every corner of life and transformed it rapidly, brutally, irrevocably. Capitalism obliterated the age-old division between country and city; it eroded, indeed dissolved, ancient norms of deference and demeanor, of hierarchy and subordination; it called forth "new men" whose wealth and power enabled them to displace the traditional ruling classes of Europe; it brought into existence a new popular culture supported not by Princes and Kings but by merchants and manufacturers.
Scholars of every ideological persuasion were fascinated and puzzled by this sudden appearance of a social force entirely new in human history. Whether they welcomed capitalism, detested it, or sought to make their peace with it, they wanted to understand what the causes and preconditions were that could explain it. These scholars were of course well versed in Biblical studies and Roman history, and as the century wore on, they became more knowledgeable about other cultures even farther afield -- Chinese civilization, the civilization of the Indian sub-continent, even the civilization of Islam, which flourished at a time when Western Europe was mired in poverty and ignorance. This acquaintance with things non-Western allowed them to undertake comparative studies designed to isolate the specific difference, the peculiar feature, of Western European society that might explain why capitalism developed there rather than anywhere else on earth and then rather than at any other time in history.
Viewed in the very simplest manner, Weber's essay is an attempt to answer the question: Capitalism -- why here and why now? Weber brought to this undertaking not only an extraordinary breadth and depth of historical, institutional, political, and theoretical knowledge [he was of the last generation of great scholars who could plausibly be described as knowing everything there was to know], but also quite specifically a long-standing theoretical interest in the phenomenon of the rationalization and bureaucratization of social life and institutions. His exploration of this theme dominates his masterpiece, his hauptwerk, Economy and Society [Wirtschaft und Gesellschaft], a massive two-volume work that has a legitimate claim as the greatest work of Sociology ever written.
Weber was quite familiar with the arguments of Marx, whose explanation for the emergence of capitalism focused on such economic factors as the primitive accumulation of capital, the creation of a landless proletariat available to serve as a "reserve army of the unemployed," and the slow development of mercantile activity leading finally to the crucial breakthrough, the production of goods for exchange and profit rather than for consumption and use, which is to say the emergence of commodity production.
But Weber, casting his eye over the entire world and five thousand years of history, was struck by the fact that so many of the elements seemingly required for the emergence of capitalism could be found in other places and other times, yet without for some reason stimulating the development of specifically capitalist modes of production and exchange. The scientific discoveries of the early eighteenth century, most particularly of the steam engine, had certainly played a role in the development of English capitalism, but the principle of the steam engine was known to the ancient Romans, who regarded it as little more than an engaging toy. The careful attention to cost and the use of double-entry bookkeeping techniques to track flows of money into and out of an enterprise were important in the rationalization of economic activity, but these techniques were well known to Renaissance Italian merchants, whose economic activities never matured into capitalist forms. The Chinese for more than a thousand years were world leaders in the development of science, the Hindus invented algebra, the Roman latifundia were as carefully and rationally managed as any English factory. And yet capitalism appeared in England, and later in France and Germany, in the eighteenth and nineteenth centuries, not at any other time or in any of those other cultures. Why?
Well, one answer that can be dispensed with immediately is that capitalism has anything specifically to do with greed. Weber writes in the Introduction to the essay, "The impulse to acquisition, pursuit of gain, of money, of the greatest possible amount of money, has in itself nothing to do with capitalism. This impulse exists, and has existed among waiters, physicians, coachmen, artists, prostitutes, dishonest officials, soldiers, nobles, crusaders, gamblers, and beggars.... It should be taught in the kindergarten of cultural history that this naive idea of capitalism must be given up once and for all. Unlimited greed for gain is not the least identical with capitalism. Capitalism may even be identical with the restraint, or at least a rational tempering, of this irrational impulse. But capitalism is identical with the pursuit of profit, and forever renewed profit, by means of continuous, rational, capitalistic enterprise."
You will perhaps see what I mean when I say that there has been an actual decline in our understanding of the social realm. Weber dismissed contemptuously as not worth serious discussion, in 1904, what is now advanced as sophisticated wisdom by supposed experts claiming to explain our present economic difficulties.
To initiate his examination of the differentia specifica of the capitalism, Weber offers the following provisional definition: "We shall define a capitalistic economic action as one which rests on the expectation of profit by the utilization of opportunities for exchange, that is on (formally) peaceful chances of profit."
Before I launch into an attempt [however doomed to inadequacy] to summarize Weber's startling and fascinating answer to his question, I need to issue several caveats so that those of you who are reading this as it is written and posted seriatim will not be misled or drawn into unfruitful disagreements.
First of all, Weber was fully aware of the fact that many, many factors cooperated in the emergence of capitalism. His essay deals with only one of them -- the secularization of a religious ethic whose character was transmuted from a ceaseless quest for salvation into a peculiar and particular mode of economic activity. Nothing in Weber's essay is intended to deny, or even to diminish the importance, of all the other factors whose presence was required for capitalism to appear. I implore you not to make the mistake, as we proceed, of thinking that Weber is denying the importance of those factors or even merely ignoring them. The text is full of passages in which he acknowledges, indeed insists upon, their importance, but in this mini-tutorial, there just is not room for me to keep paraphrasing or quoting those passages. You must either take my word for this, or -- what would of course be vastly preferable -- obtain a copy of the essay and read it yourself.
Second -- and this is rather more complicated -- Weber developed and used a mode of analysis of social phenomena to which he gave the label "ideal types." I will have to say something about this subject very soon in this mini-tutorial. To anticipate just a bit, Weber seeks not to formulate statements about average or, in the ordinary sense of the word, "typical" social phenomena, but rather to define internally logically coherent "ideal types" whose analysis enables us to understand better the endlessly variable and complicated phenomena we encounter when we look in detail at the facts. To get a handle quickly on this notion, think of the familiar use by psychiatrists and the general public of notions like "anal-retentive personality" or "narcissistic personality" or "bi-modal personality disorder." It may well be that few if any actual individuals perfectly fit these concepts, and yet they are useful for making sense out of the otherwise bewildering diversity of behaviors and personality traits we encounter in any population.