Ideology, interest groups, and institutional change: the case of the British prohibition of wages in kind

2005 ◽  
Vol 1 (2) ◽  
pp. 175-191 ◽  
Author(s):  
ELAINE S. TAN
Keyword(s):  
Institutional Change ◽  
Interest Groups ◽  
Institutional Economics ◽  
Legal Protection ◽  
New Institutional Economics ◽  
Relative Price ◽  
Industrial Workers ◽  
Relative Prices ◽  
Social Ideology ◽  
Legislative Changes

The new institutional economics has emphasized the importance of ideology in determining the content and direction of institutional change. Ideology can also determine when interest groups succeed in achieving legislative favor. The case of the regulation of in-kind wages in Britain shows that factors highlighted in mainstream political economy (such as interest group strength and organization, self-interest of legislators, and coalitional partners) were important. However, the interaction between relative price changes and social ideology was also significant in explaining the shape and timing of legislative changes. Changes in relative prices gave labor groups the incentive to seek legal protection from non-monetary wages, but they obtained protection only if they met certain criteria established by the prevailing ideology. Changes to that ideology resulted in further legislative changes granting cash wages to most industrial workers.

International Economic Institutions, Institutional Complementarities and Institutionalized Linkages. The International Trade Case

2011 ◽  
pp. 67-90
Author(s):  
Maurizio Mistri
Keyword(s):  
International Economic ◽  
International Trade ◽  
Institutional Economics ◽  
Procedural Knowledge ◽  
New Institutional Economics ◽  
Relative Price ◽  
Economic Institutions ◽  
Real Economy ◽  
Procedural Rationality ◽  
Institutional Complementarity

This paper analyses the forces at the base of the formation processes of international economic institutions following the fundamental New Institutional Economics (NIE) approach. In particular, the paper assumes that new international economic institutions respond to a principle of procedural rationality. This principle indicates that the formation of institutions takes place in an environment dominated by the bounded rationality of agents that produce institutions based on procedural knowledge accumulated over time. Particular attention is dedicated to the relationship between institutional innovation and economic growth. Specialized institutions stem from this relation, on par with the real economy, and generate more and more complex institutional systems. Within the institutionalist approach to the formation of institutions, the paper highlights Aoki's concepts on "institutionalized linkages" and "institutional complementarity"; these concepts are then correlated to Schelling's "strategy decomposition" concept; subsequently the forces that lead to institutional changes (Aoki and North) are analyzed. Specifically, in light of North's approach, conditions are analyzed that determine changes in institutions governing international trade relations deriving from changes in some structural dimensions such as relative price systems. These changes are possible since governments can renegotiate original agreements giving rise to compensations.

scholarly journals The impact of Covid-19 pandemic on the institutional change in developing countries

2021 ◽  
Vol 20 (3) ◽  
pp. 587-601
Author(s):  
Tomasz Legiędź
Keyword(s):  
Developing Countries ◽  
Institutional Change ◽  
Institutional Economics ◽  
Influenza Pandemic ◽  
Civil Liberties ◽  
New Institutional Economics ◽  
Institutional Changes ◽  
Current Events ◽  
Institutional System ◽  
The Impact

Motivation: The Covid-19 pandemic is having a critical impact on economies, especially in developing countries. Such a serious external shock affects the distribution of economic rents, thus leading to potentially large institutional changes. Naturally, in the short term we are dealing with an economic crisis and a restriction of civil liberties in both autocratic and democratic countries, however, it is not known what the dynamics of institutional changes will be in the longer run. Aim: The main purpose of the article is to answer if the Covid-19 pandemic becomes a turning point that will determine the institutional system in developing countries for the next few decades. The first part of the article outlines the theory of institutional change, with particular emphasis on the role of external shocks. The next section presents studies on the socioeconomic impact of two major epidemics: The Black Death and the Great Influenza Pandemic. The third part conducts an assessment as to what extent the current pandemic may affect institutions in developing countries, by reference to the example of two countries: Tunisia and Cambodia. The analysis is conducted from the perspective of the new institutional economics. Results: If we look at the experiences from previous pandemics, current events and refer to the literature on the theory of institutional change, we can conclude that significant institutional changes caused by Covid-19 are unlikely. The process of institutional change is characterized by a specific complexity and changing dynamics. Nonetheless, it is the internal factors, reflecting the actions of people trying to maximize the benefits, which are the main cause of change in an institutional system. Therefore, the Covid-19 pandemic is more likely to strengthen the endogeneity of the process of institutional change, rather than change its course.

Historical analysis of institutions and organizations: the case of the Brazilian electricity sector

2014 ◽  
Vol 11 (1) ◽  
pp. 191-212 ◽  
Author(s):  
GUILHERME SIGNORINI ◽  
R. BRENT ROSS ◽  
H. CHRISTOPHER PETERSON
Keyword(s):  
Institutional Change ◽  
Institutional Economics ◽  
Debt Crisis ◽  
Historical Analysis ◽  
Economic Recession ◽  
New Institutional Economics ◽  
The Body ◽  
Electricity Sector ◽  
Causal Explanations ◽  
Market Protection

AbstractScholars argue that the New Institutional Economics (NIE) has not yet provided causal explanations on how long institutions persist or why and how they suffer dramatic changes. Others state that evidence is still inconclusive to define a theoretical justification on how changes and development occur. This article focuses on the institutions of the electricity sector in Brazil, aiming to heighten the body of empirical research in NIE and produce satisfactory explanations that motivate theory refinement. Based on a qualitative approach, we find that the drivers of the first institutional change in Brazil's electricity sector were related to market protection and domestic industrial support. For the second institutional change, economic recession (country at state of bankruptcy, debt crisis, and high inflation rates) and reliability of utility services were the driving factors. We hope this study systematizes historical facts and helps create grounds for our understanding of institutional evolution and economic growth.

scholarly journals Hemmnisse institutionellen Wandels im Kleinprivatwald aus der Sicht der Neuen Institutionenökonomik | Constraints on institutional change in smallscale forestry: a New Institutional Economics perspective

2006 ◽  
Vol 157 (3-4) ◽  
pp. 84-90 ◽  
Author(s):  
Achim Schlüter
Keyword(s):  
Forest Management ◽  
Institutional Change ◽  
Institutional Economics ◽  
Theoretical Perspective ◽  
Explanatory Power ◽  
New Institutional Economics ◽  
Institutional Changes ◽  
Wood Production ◽  
Private Forests ◽  
Production Chain

This contribution looks at the problems of bringing small, private forests into the wood production chain from an institutional theoretical perspective. This would conclude that institutional changes are inevitable. In practice, however, structures in small private forests are characterised by considerable inertia. Various approaches in New Institutional Economics are investigated to determine whether they can provide an explanation for this inertia. Explanatory power can only be developed by employing a combination of different approaches. The current extension of this theory into ideological and trading resources is equally necessary to understand the institutional change in forest management.

Towards micro-foundations of institutional change

2017 ◽  
Vol 23 (3) ◽  
pp. 223-240 ◽  
Author(s):  
Kyle Bruce ◽  
Peter von Staden
Keyword(s):  
Institutional Theory ◽  
Institutional Change ◽  
Institutional Economics ◽  
New Institutionalism ◽  
New Institutional Economics ◽  
Research Review ◽  
Sociocultural Context ◽  
Content Type ◽  
Organizational Sociology ◽  
Micro Foundations

Purpose Given managerial choices and the sociocultural context in which they are made are at the heart of management history, then an understanding of both is critical. This paper argues that the “late” North (2005) provides such an understanding. Design/methodology/approach This study is a research review synthesizing much disparate but cognate literature across the new institutionalism in organizational sociology/studies and in economics. Findings “Late” North (2005) provides an important ontological frame for dealing with the so-called “paradox of embedded agency”, an approach that may afford management historians a more thorough account of how institutions are formed and change over time. North has always maintained that institutional change is the outcome of deliberate or intentional choices made by actors. However, and unlike his earlier work which ignores how humans come to make the said choices, North (2005) explicates the sociocognitive process by which intentionality emerges with expanded consciousness, as humans construct ideas and beliefs about reality, beliefs that shape decisions to alter the said reality via the process of institutional change. Originality/value It is rather curious that despite North’s status as a “historian”, management historians – or at least those publishing in this journal from its founding in 1995 – do not seem to be terribly interested in North’s work. Although North rates a mention in rival journals, other than Dagnino and Quattrone’s (2006) study, papers in this journal invoking institutional theory align with the new institutionalism in organizational sociology/studies (NIOS) rather than North’s new institutional economics (NIE). Even in the related sub-discipline of business history, those professing an interest in institutions are more interested in the NIE of non-historians Coase and Oliver Williamson than they are in North’s NIE. And, in recent work analysing the place and significance of institutional theory in historical research, the foundations are unmistakeably NIOS rather than North’s NIE.

Development, Informal Institutions and Agency Analyzed through the Lens of New Institutional Anthropology: A Modification of Ensminger’s Framework on Institutional Change

2017 ◽  
Vol 137 (1-2) ◽  
pp. 69-91
Author(s):  
Johanna Friederike Goetter
Keyword(s):  
Institutional Change ◽  
Political Institutions ◽  
Institutional Economics ◽  
Informal Institutions ◽  
New Institutional Economics ◽  
Wide Range ◽  
The Status ◽  
Specific Outcome ◽  
History Of ◽  
The Impact

In development research, much effort has gone into analyzing the impact of economic and political institutions and their adequate design. However, unforeseen factors such as the impact of the cumulative behavior of individuals as shaped by informal institutions – especially social norms and moral values – may also determine the pace and path of development. Thus, positive economic, social or political triggers may only then translate into development if the relevant actors adapt their strategies and actions appropriately. Similarly, while negative triggers may induce a deterioration of the socioeconomic situation if no adaptation or a mal-adaptation takes place, in another real-world setting with a different set of institutions and actors it may in turn be possible to preserve the status quo. Sound analytical frameworks are needed to gain a deeper understanding of the complex and dynamic interaction of factors leading to a case-specific outcome and history of change. These frameworks have to be specific enough to allow the interpretation of complex changes and dynamics and at the same time general enough to fully cover a broad range of diverse settings and all important but possibly unforeseen aspects. In this paper, I present a modified version of the Framework for Modeling Institutional Change developed by Jean Ensminger (1992). Accounting for the relationships and dynamics of incentives, formal and informal institutions, bargaining power and the constellation of actors, Ensminger’s framework, which is rooted in the theoretical approach of New Institutional Anthropology, merges important aspects from New Institutional Economics and anthropology. However, it fails to leave room for agency which, as the paper illustrates, has been shown to play an often important role in development. The modified version of Ensminger’s framework incorporates agency as a main factor. For the purpose of demonstration, it is applied to a case study on informal constraints to cope with cattle rustling in Madagascar. The paper illustrates the modified framework’s analytical strength for a meticulous investigation of a wide range of empirical cases and discusses to which development-related cases and research interests it fits best. JEL Codes: B52, O1, N57, Z13

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