Institutional variety and the future of economics (original) (raw)
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Evolutionary and Institutional Economics: A View from the Post-Neo-Classical Perspective
“Evolutionary and Institutional Economics: A View from the Post-Neo-Classical Perspective.” In Theory and Practice of Institutional Reforms in Russia / Collection of scientific works, ed. B.H. Yerznkyan. Issue 21. – Moscow, CEMI Russian Academy of Sciences, 2011: pp. 90-113.
This paper proposes an alternative to evolutionary theory in the field of economic sociology. It highlights the distinctiveness between purposeful human-made systems and non-purposeful natural systems. It draws upon work in Soviet economic planning by Russian engineer G.A. Feldmann, as well as in mathematics by the German polymath H. Grassmann and cultural theory by the Canadian humanities scholar M. McLuhan, which indicate the suitability of an extension methodology for human-social thought generally. The paper challenges evolutionary economic theory with a post-neo-classical approach that identifies the import of reflexive ideas in human-social sciences. It concludes that new views of human extension and development are needed to escape from deterministic dogmatism in some western economic ideologies.
Introduction to the special issue on the future of institutional and evolutionary economics
Journal of Institutional Economics, 2014
This special issue of the Journal of Institutional Economics on the future of institutional and evolutionary economics consists of this introduction, four full essays, and two sizeable comments. Ménard and Shirley (2014) and Ménard (2014) discuss the future of the new institutional economics, and their two essays are followed by a reflection by Hodgson. Winter (2014) and Witt (2014) discuss the future of evolutionary economics, and their essays are followed by a comment by Stoelhorst. Here, we introduce these essays and comments by putting them in a broader historical perspective. In particular, we trace the common origins of modern institutional and evolutionary economics, particularly in the work of Veblen, as well as important additional influences such as Schumpeter and Simon. We highlight how the two approaches became disconnected, and signal the possibility of, and need for, re-establishing closer connections between them. Possible elements of a future overlapping research programme are outlined. Over the past quarter century. .. evolutionary and institutional economics have shown new life, and they are beginning to join together again. (Nelson 2005: 3)
Journal of Evolutionary Economics, 2003
, I make a case for bringing institutions into evolutionary economics. But unlike Nelson, who defines institutions as social technologies consisting of rules-routines, I define them in agreement with North (1990) as humanly devised rulesconstraints -such as formal law and informal social norms -but also view them, to accommodate most of Nelson's approach, as constraining the variety of rules-routines employable by agents. I show that this definition has advantages for communicating with modern institutional analysis, for clarifying how institutions can influence, and be influenced by, changes in physical and social technologies, and for producing policy implications. the participants of seminars at the University of Jena and the Royal Institute of Technology in Stockholm, and two anonymous referees for valuable comments on earlier drafts. The usual caveat applies. Like Nelson , I am convinced of the need to bring economic institutions into evolutionary growth theory, and more generally, of the need to connect institutional economics with evolutionary economics, not only for further development of theory, but also, and perhaps above all, for reliable assessment of policies. The question how best to do so has also preoccupied me for several years. 1 But what I have found to be the most fruitful way of doing so differs from Nelson's. The roots of this difference are in the old conceptual dilemma encountered by several economists who have searched for an operationally clear definition of institutions, which can roughly be stated as follows: should institutions be defined as constraints, comparable to "the rules of a game," or as routines, meaning "specific ways of playing a game"? Nelson , drawing on Nelson and Sampat with references to Schotter (1981) and Sugden (1989), opts for the latter, and moreover denotes such routines as "social technologies." In contrast, I have found strong reasons why evolutionary economists should definitely prefer, in agreement with North (1990), the former. The purpose of this paper is threefold: to present these reasons, to consider the consequences for evolutionary economics of bringing into it institutions qua "the rules of a game," and to show how this will help evolutionary economics to deal with two important but so far insufficiently explored issues: namely, how technological and institutional changes may depend on each other, and how the performance of economies may depend on their institutions and be improved by feasible policies. No substantial conflict with Nelson's approach is implied: after a terminological adjustment, it is offered a well-defined place in a broader theoretical framework. The adjustment is that Nelson's term "social technologies" is recognized as useful, but not, as he also suggests, as a synonym for "institutions." His approach is thus approved of for dealing with changes in physical and social technologies, including the often intricate relationships between the two, but not directly with institutions.
2023
Dear colleagues, an update to share some thinking and writing, practical uses, and its pre-, and post- pandemic economic development context. The thinking generated in these articles has also been used in the analysis for reports, or invited to several organizations and practical issues for debate: UNIDO, ILO, UNRISD, G20/T20, on for Covid-19, for informal labour, on social policy, on medical diagnostics and devices, on the issues of innovation metrics, and others. It has been invited in debates on geopolitics, the future of economics, on liberalism, on culture, and the rise of non-Western economies especially in Asia, as well as on India's development. Institutional Variety (IV): What and Why There are a series of new articles published 2020-2023 (listed below), some forthcoming, focused on the critical unanswered questions of Institutional Variety (IV) in economics and wider political economy. The questions relate to the innate recognition that variety exists, taxonomies of countries matter more than ever, that 'capitalism' or even 'varieties of capitalism', and discussions of 'rules-based international order' and multilateralism, have limited the fundamental questions of variety of economies and in economic activity that are currently studied. Any serious scholar of economic development or of innovation must grapple with the intellectual and practical issues associated with such variety (defined and explained with many examples in these articles below from sustainability and industrial policy to cancer and methodology on technology evolution). In my view, the IV discussion in these articles may help advance essential questions of economics inference, its scientific method, the intra-paradigmatic gaps and debates within evolutionary political economy (irrespective of 'mainstream' aversion), and the very pertinent challenges of economic development and industrial policy design in countries industrialising today. There are further debates to take on cautiously closely linked to the question of how much variety in the economy and society help a country: Is more IV 'good', 'bad', chaotic, necessary, or even considered 'progress'? How does IV relate to issues such as democracy or knowledge evolution? What about decolonisation and racism? Which types of metrics and heuristics to use?
Institutional Analysis and Evolutionary Theory
This paper examines evolutionary theories developed in the life sciences and explores the ways in which specific concepts and insights from these theories can be successfully applied to social and political institutions. This paper is not intended to present its own research, but instead offered as an introduction to evolutionary theory and some of its implications for political science. We argue that endogenous institutional change should be seen as an evolutionary process. Viewing history in this way, however, suggests a different ontological perspective than that which is typically found in political science. We highlight Darwin's fundamental insight that evolutionary change depends on the variation between every individual within a population or species. Because all individuals are different, they will sometimes respond or adapt to environmental stimuli in unique ways. Secondly, we examine some of the ontological positions underlying evolutionary theory and demonstrate why they are appropriate for studying issues of interest to political scientists and institutionalists in particular. Finally, we attempt to use some of the insights drawn from evolutionary theory to help offer insights on two current issues in political science theory: 1) where do preferences come from and 2) how can we explain institutional change? 1 The authors would like to thank
Evolutionary and Institutional Economics as the New Mainstream?
Evolutionary and Institutional Economics Review, 2007
Mainstream economics has changed radically since the 1980s, offering greatly enhanced opportunities for intervention by evolutionary and institutional economics. This article surveys the extent of this transformation and the extent that mainstream economics has moved in an evolutionary and institutional direction. There are also signs of a possible gestalt shift in the social sciences, where rules are seen as constitutive of social relations and social reality. This contrasts with the former emphasis in mainstream economics on incremental change and equilibria. On the other hand, mainstream economics has a preoccupation with technique over substance, and the barriers between disciplines impair appropriate conceptual developments.
The Evolution of Economic Institutions
The Evolution of Economic Institutions, 2007
Instituted economic processes, increasing returns and endogenous growth 98 J. Stanley Metcalfe 7. Path dependence, its critics and the quest for 'historical economics' 120 Paul A. David PART III THE MARKET IN ECONOMIC THOUGHT 8. Financial markets and economic development: myth and institutional reality 145 Jan Kregel v 9. The meaning of the market: comparing Austrian and institutional economics Philippe Dulbecco and Véronique Dutraive PART IV COMPARATIVE EVOLUTIONARY PERSPECTIVES 10. Uncertainty, intelligence and imagination: George Shackle's guide to human progress Brian J. Loasby 11. Evolutionary themes in the Austrian tradition: Menger, von Wieser and Schumpeter on institutions and rationality Richard Arena and Sandye Gloria-Palermo 12. The relevance today of Edith Penrose's Theory of the Growth of the Firm Margherita Turvani 13. The Naturalist view of Universal Darwinism: an application to the evolutionary theory of the fi rm J.W. Stoelhorst Bibliography Index vi Contents Tables 4.1 Sources of cooperation 4.2 Instruments 4.3 Typology of strategy (for X) 5.1 OECD standardized unemployment rates, 1959-98 5.2 A change of techno-economic paradigm 5.3 Details of change of techno-economic paradigm in OECD countries viii Contributors
Institutions, markets and economic evolution - conceptual basis for a naturalist institutionalism
2010
The University of ManchesterJorge Manuel de Meneses BateiraDoctor of Philosophy (PhD), 2010Institutions, Markets and Economic Evolution - Conceptual Basis for a Naturalist InstitutionalismWe might wonder, after two centuries of economic science and thousands of articles and books written by economists, if something new can still be said about ?markets?. Today, what new contribution could still be given to a so fundamental concept in economics? This thesis builds on the main legacy of Veblen, Polanyi and Hayek?s Institutionalism: the distinction between the ?interactional? level of human sociality and the ?structural? level of society that Veblen named ?institutions?. The three authors tentatively formulated an original idea: the two levels of sociocultural reality are interdependent and mutually constitutive. This is a proto-emergentist ontology of institutions that makes the starting point of the thesis. Convergent results of different disciplines are explored in order to develop s...
Introduction to the Special Issue on the Evolution of Institutions
2011
How can evolutionary ideas be applied to the study of social and political institutions? Charles Darwin identified the mechanisms of variation, selection and retention. He emphasized that evolutionary change depends on the uniqueness of every individual and its interactions within a population and with its environment. While introducing the contributions to this special issue, we examine some of the ontological positions underlying evolutionary theory, showing why they are appropriate for studying issues in economics, political science and sociology. We consider how these ideas might help us understand both institutional change and the formation of individual preferences. * the key insights suggested by evolutionary theorists across several disciplines and examine how they may help us better understand key conundrums confronted in political science and economics.
2007
This paper takes a stance on the recent debate about the explanatory relevance of the Darwinian scheme “variation-inheritance-selection” for the study of socio-cultural evolution. Building on the knowledge of different disciplines, I argue that the fundamental assumptions of such debate are misleading. Rather than building analogies to other levels of reality, I treat the “economy” as an institution whose nature and dynamics is socio-cultural, that is, intrinsically different from the dynamics of physic-chemical and biological realities. The main implication of this multi-level ontology is the rejection not only of generalized Darwinism but also of any other generalized scheme such as self-organization. I finally suggest the reconciliation of the terms “evolution” and “history” taking account that I consider evolutionary institutional economics as a sub-discipline of social science.