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Methodological individualism is the theory that social phenomena can only be accurately explained by showing how they result from the intentional states that motivate the individual actors.[1] The idea has been used to criticize historicism, structural functionalism, and the roles of social class, gender roles, or ethnicity as determinants of individual behavior. It is promoted by the Austrian School of economics in interpreting economic developments.
Mark Blaug, known for his work on the history of economic thought, has criticized over-reliance on methodological individualism, "it is helpful to note what methodological individualism strictly interpreted ... would imply for economics. In effect, it would rule out all macroeconomic propositions that cannot be reduced to microeconomic ones, ... this amounts to saying goodbye to almost the whole of received macroeconomics. There must be something wrong with a methodological principle that has such devastating implications."[2]