Since its inception in the 1870s, neoclassical economics has introduced a new focus on the smallest of unit of analysis in modern economic society: the individual agent. Class-based issues, as pored over by the classical economists – Ricardo on the tensions between landlords and manufacturers, Marx on the conflict between workers and capitalists – were suddenly dropped. What mattered in this new reformulation of economics was the role of individuals, maximizing their utility and engaging in exchange with others in a free market economy.

An important consequence of this neoclassical revolution was that it also heralded a change in method. Once the decision-making of individuals becomes the focus, this changes how economic inquiry is conducted. Instead of issues relating to growth and distribution, considered by the classics, the focus turns to exchange and prices. And when individuals maximize utility the focus turns to measurement of the value they obtain in exchange. In what has been called the Methodenstreit (battle over methods) that took place in Germany towards the end of the nineteenth century, the new marginalist method was disputed by adherents to the then dominant historical school, antecedents to present-day heterodox economics (as introduced in Chapter 2).

This chapter introduces the battle of methods and considers how the method employed by neoclassical economics has come to be dominated by mathematical tools of analysis. For the professional economist, mathematical skills have moved from being desirable to essential in modern universities, with economics seen as a technical quasi-scientific discipline.