Menger's criticism of essentialism shows that this approach is inadequate for the tasks of the theoretical social sciences. In its form as methodological inductivist essentialism, this approach has to be rejected for logical and epistemological reasons; its derivative, the organic understanding of social phenomena, cannot meet the task of providing satisfactory explanations of institutions because it assumes them; and the essentialism approach of explaining exchange and relative prices basically discards the idea of a theoretical social science by transforming it into a subdiscipline of psychology. In contrast, Menger aims at developing a nominalist and relational behavioural theory based on a combination of methodological individualism and a theory of subjective evaluations and which is based on experience.