The Evolution of Economic Institutions (original) (raw)
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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...
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.
The Socio-economics of Institutions and Evolution
Evolutionary and Institutional Economics Review, 2005
Evolutionary economics has two different identities -negative and positivethough we may find them interrelated when we study them more deeply. What objections evolutionary economics has raised to orthodox Neo-classical economics determine its negative identities. More specifically, they are formed as counterarguments against two principles of Neo-classical economics: strong rationality of agency in the form of maximisation of any functions of utility or profit at the micro level, and the perfect coordination of aggregate demand and supply in all markets or the compatibility of strategies of agents in the form of various types of equilibria at the macro level. In the Neo-classical 'micro foundation of macro economics' perspective, pre-determined micro-level behaviors exclusively decide macro-level states. However, there are different alternatives to these two principles and the micro-macro relation. Behaviors of the agent with the various types of context-related/situated rationality or non-rational social preferences, as well as non-equilibrium or process-oriented coordination in various institutional contexts, can be considered from the viewpoint of evolutionary economics.
A Critical View of the Institutional Solution in Economics
Transition Studies Review, 2009
Institutionalism is the solution at hand when the expected correlations fail to work. The analytical framework is henceforth enriched with institutional pillars such as stable political structures, lack of corrupt practices, well-specified property rights, low-cost enforcement of contracts, etc. This paper's thesis is that institutionalism has its own limits circumscribed by the original view of the logic of economic inquiry based on causation. Ignoring the external circumstances of the social whole by virtue of ceteris paribus postulation creates an epistemic vacuum as regards the most part of our understanding of economic evolutions. In guise of a practical corollary, the paper ends with a casuistic illustration from Eastern European transition economies and concludes that the uncertainties of transition, neither more obscured, nor more difficult than of any other historical system, are left as much puzzling in orthodox as in institutional recipes.
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.