Investigations into the Methods of the Social Sciences is the book that gave the Austrian School its name.
The famed Methodenstreit of the late 19th century was, translated literally, a debate over method. It pitted the emerging Austrian School against the German Historical School on a critically important question: What is the proper way to do social science?
In this essential work, Carl Menger, the founder of the Austrian School, vindicates the centrality of theory, and thus lays the foundation for later developments by Mises and others. Written 12 years after Menger's principles book, Investigations sought to deal with the hostility with which that previous book had been greeted in the German world.
Menger here argues that economics can and must be more than an effort at observing, collecting, and assembling data. It can and should make general observations about the laws of economics that operate independently of time and place. This view was, of course, directly opposed to that of the German Historicists.
Joseph Salerno writes, "The Investigations precipitated a furor among German economists who heatedly responded with derisive attacks on Menger and the Austrian School. In fact, this latter term was originated and applied by the German Historicists in order to emphasize the isolation of Menger and his followers from the mainstream of German economics."
No Austrian can rightly overlook this bedrock text.
