This is a confused and confusing book. It has some value as a comprehensive survey of thought on the topic of methodology in economics and it signals that when Popper is understood as a critical rationalist instead of a falsificationist then he makes a lot of sense. Larry Boland has been saying that for 20 years and he should have got more credit from Hands.
The book has three goals. First, to provide a survey of recent developments in the field of economic methodology. Second, to survey contemporary science theory as it relates to economics. The third "is to convince the reader that we should change the subject". He suggests that we should abandon the 'off the rack' or 'shelf of scientific philosophy' approach to the philosophy of science. This approach consists of trying to find out what economics should be doing to qualify as a proper science. His alternative is to encourage people to think the issues through afresh, to explore the full range of approaches that are available to economists in place of the traditional, largely positivist/empiricist philosophy of science.
Methodology has never had much of a profile among working economists and it had to make its way by attaching itself to the history of ideas in economics which at least had some academic credibility in the form of journals and conferences. However this meant that both the historians and the methodologists occupied a kind of outhouse behind the place where all the real economists lived.
The overwhelming defect in the book is the way that Hands describes the Received View in the philosophy of science as a mixture of logical positivism and falsification interpreted in a positivistic way. Popper is unfortunately misrepresented as an eccentric contributor to the Received View, largely under the influence of Lakatos his followers, especially Latsis and Blaug. Under the influence of this misrepresentation of Popper's though, a generation of scholars have wasted much of their careers, playing in a kind of intellectual sandpit, off to the side of economics and philosophy, without making a significant contribution to either.
The weakness of the Hands book is demonstrated by the neglect of Boland and Wong. The latter is mentioned twice, in passing, without any hint of the way that he shredded the program that won Samuelson a Nobel Prize for his contribution to methodology in economics. Boland is noted as a man who always resisted the "falsificationist" interpretation of Popper and his books are cited without any hint of the riches to be found in them. This contrasts with the whole chapter on "The Sociological Turn" and hundreds of pages devoted to other dead-ends like feminist methodology.
The best part of the book is where the author depicts Popper as a critical rationalist and shows how this makes sense of Popper’s hitherto rather confused exposition of situational analysis and the rationality principle. Given this grasp of Popper (provided by Boland in his first book in 1982) Hands should have junked all the previous pages of criticism of Popper’s non-existent “falsificationism”.
Unfortunately, despite the wide scope of the material covered in this book, the Austrian school of economic thought does not get a decent mention. Caldwell did rather better on this in “Beyond Positivism”. It is quite likely that when Popper is fully understood as a critical rationalist, and when his theory of research programs is also understood, then a highly synergetic combination of Popper and the Austrians may be possible. That man Boland (again) was just about there with his Popper/Hayek model in 1982.
In conclusion, if Hands can fully consolidate his new understanding of Popper (instead of making out that this is a development in Popper’s thought rather than his own) then his next book should be shorter and much more helpful.