Societies are made up of individuals. In turn, individuals form small groups like the family: an important institution of society. Individuals also make other institutions like the state and the economy. These thick institutions have separated themselves from the individuals. A strange situation arises in which individuals feels dominated by the very institutions they made in the early ages of human civilization. Individuals also feel alienated from those institutions which have become impersonal and very powerful. This problematic relationship between individuals and institutions has been studied by the social sciences in much detail especially in the works of 19th century scholars. In the 20th century, however, a strange thing happened with the study of institutions and individuals; they have separated themselves from each other and gone into different branches of social science. The economy is now the exclusive area of economists and politics have become the playground of politicians and political scientists. The study of individuals has become the most important reason for the existence of psychology. Only sociology and cultural anthropology have tried to preserve the linkages between individuals and society. But cultural anthropology has lost much interest in this relationship and has become a descriptive social science mainly studying primitive societies. Only sociology is still trying to study this relationship on a truly global scale: locally, nationally, and internationally.

Three solutions have been tested in time to solve the relationship between individuals and institutions:

1. Simply ignoring the problem by viewing the social reality as consisting as a unity between individuals and institutions. The existence of large groups (societies) is thus seen as merely being the integration of small groups. This nave view is does not enjoy much support.

2. The second solution, on the other hand, is widely supported; the analysis is started with individuals and followed by the analysis of institutions producing four variants:
a. The social reality and the existence of a certain culture are basically the result of motivation of individuals. These factors will then be mirrored at the institutional level;
b. The individuals are the center of attention, but the influence of the institutions continues to exist. By recognizing the influences of the two levels on e ach other, the mistake of separating them is avoided;
c. A strong emphasis is placed on economic theories. Individual behavior is again seen as the most important aspect of the social reality. The individual is a rational acting person who is constantly calculating all the costs and benefits of his actions;
d. The application of system theories in the analysis: society is seen as a complex social system which is constructed by a number of subsystems.

3. The third and final solution is emphasizing the dominance of institutions over individuals. In other words, the individual-institution problem is turned around and becomes the institution-individual problem. The analyses of institutions are far more important and answers found in this analysis are used to tackle the problems of individuals.

This short discussion of the individual-institution problem shows how difficult the problem is and how many different solutions have been proposed to solve this problem. One of the solutions to this problem which can be seen as a modern solution is proposed by the German philosopher and social thinker Habermas. He made a powerful plea for a renewed appraisal of rational thinking. He did agree that with the fact that modern Western societies are dominated by the overemphasis of efficiency and by the new gods, power and money, but he continued to believe in the potency of human reason. By applying the theories of Weber, Mead, Durkheim, and Marx, he formulated his theory of communicative action. The core of this theory is a critique of modern Western societies, but producing a positive outlook at the future. Moreover, his theory is a synthesis of the individual-institution perspectives.

According to Habermas, social reality can be subdivided into two parts. One part consists of the economy and politics. Both have become systems in which decisions are made that are strictly based on the maintenance of efficiency. This situation gives rise to the domination of communication by money and power. This situation is not necessarily problematic because an economy is essential for welfare, whereas politics is necessary for efficient public administration. It becomes problematic when this efficient way of thinking colonizes the other part of society: the life world. The life world consists of individuals with their own unique personalities and culture. So, when political questions like is it efficient? And economic questions like is it profitable take over the life world where questions like is it useful and is it right should be asked, the situation becomes problematic.

Although the colonization of the world of the living is happening in modern societies, Habermas does not believe that this is inevitable. Although man may be captured by economical and political ways of thinking, he still has one strong weapon: the use of language. Language will result in communication where man can reach agreements not only based facts, but also on standards and value. It is still possible to formulate rational agreements between men with the use of language. Real evidence of how this weapon is successfully applied can be found in the activities of social movements. Habermas did not specifically formulate a strategy to cope with the problem of colonization, but as a scientist, he was convinced that this problem can be resolved by a new paradigm: the theory of communicative action, which is actually his own theory.