The future of new institutional economics: from early intuitions to a new paradigm?

2014 ◽  
Vol 10 (4) ◽  
pp. 541-565 ◽  
Author(s):  
CLAUDE MÉNARD ◽  
MARY M. SHIRLEY
Keyword(s):  
Institutional Economics ◽  
New Institutional Economics ◽  
Neoclassical Economics ◽  
New Paradigm ◽  
Success Story ◽  
Policy Debates ◽  
The Future ◽  
Nobel Laureates ◽  
Analytical Tools

Abstract:The trajectory of institutional economics changed in the 1970s when new institutional economics (NIE) began to take shape around some relative vague intuitions which eventually developed into powerful conceptual and analytical tools. The emergence of NIE is a success story by many measures: four Nobel laureates in less than 20 years, increasing penetration of mainstream journals, and significant impacts on major policy debates. This rapid acceptance is remarkable when we consider that it was divided from birth into distinct schools of thought. What will be the future of NIE? Will it be quietly absorbed by mainstream theory, or will it radically transform neoclassical economics into a new paradigm that includes institutions? To address these questions, we follow the sometimes-bumpy road to NIE's current successes and ponder the challenges that lie ahead.

Governing the Environment: the Intitutional Economics Approach

2009 ◽  
pp. 61-86
Author(s):  
Arild Vatn
Keyword(s):  
Transaction Costs ◽  
Environmental Governance ◽  
Institutional Economics ◽  
Specific Area ◽  
New Institutional Economics ◽  
Neoclassical Economics ◽  
Institutional Perspective ◽  
Institutional Structures ◽  
Plural Rationalities ◽  
Jel Classifications

- Analyzing environmental governance implies foremost to analyze institutional structures and their implications. In doing so, the present paper utilizes insights primarily from the tradition of classical institutional economics. The paper is divided in three. In the first part I describe the main features of the classical position and compare it briefly with that of neoclassical economics and the tradition of new institutional economics. In the second part I clarify what is considered the main aspects of governance as seen from an institutional perspective. In part three I move to the more specific area of environmental governance. The concept of resource regimes is defined. Moreover I analyze how different regimes influence which environmental problems appear and how they can be treated. I discuss how institutions influence the formation and articulation of knowledge and values, how they form and protect interests, how they influence the level of transaction costs and hence the possibilities for coordination, and finally how they form the motivations underlying human choices in concrete contexts. Given that all these variables are shown to be endogenous to the institutional system, the use of comparative analysis in the assessment of various governance options is emphasized.Keywords: classical institutional economics, interdependence, resource regimes, value articulation, interest protection, transaction costs, plural rationalities.JEL classifications: B52; Q50; D02; D70.

Blood, Sweat, and Tears: The Rise and Decline of the East German Economy, 1949–1988 / Blut, Schweiß, Tränen: Aufstieg und Niedergang der ostdeutschen Wirtschaft, 1949–1988

2000 ◽  
Vol 220 (4) ◽  
Author(s):  
Ulrich Blum ◽  
Leonard Dudley
Keyword(s):  
Information System ◽  
Life Cycle ◽  
Institutional Economics ◽  
Foreign Capital ◽  
German Economy ◽  
Economic Structure ◽  
New Institutional Economics ◽  
Neoclassical Economics ◽  
Economic Decline ◽  
East German

SummaryThe rise of the East-German economy in the 1950s and 1960s and its decline in the 1970s and 1980s is difficult to explain by neoclassical economics. However; the observed life cycle may be explained by the inclusion of concepts from old and new institutional economics and from functional economics. Three distinct periods may be identified. During the “blood” period of forced development and autocratic rule, the information system and the system of property rights were roughly compatible with the economic structure. Then, in the “sweat” period, an attempt to overtake the capitalistic societies failed. Finally, in the “tears” period, economic decline could only be disguised by unsustainable inflows of foreign capital. This institutional explanation of the East-German collapse is tested with data for the period 1949-1988 and cannot be rejected.

scholarly journals Comparative institutional law and economics: reclaiming economics for socio-legal research

2019 ◽  
Vol 26 (3) ◽  
pp. 372-393
Author(s):  
Lyubomira Gramcheva
Keyword(s):  
Institutional Economics ◽  
Law And Economics ◽  
Comparative Law ◽  
Chicago School ◽  
New Institutional Economics ◽  
Neoclassical Economics ◽  
Legal Research ◽  
Legal Scholarship

Law and economics is a controversial method of legal research, increasingly popular among some legal scholars but disliked by many others. The author discusses some of the objections raised by lawyers (as well as some economists) and argues that most of these are caused by the employment of the wrong economics on the respective side of the conjoined field. She contrasts neoclassical economics, made extremely popular by the Chicago school and Professor Richard Posner in particular, with New Institutional Economics and argues that the latter can overcome the difficulties presented by the former. While neoclassical economics seems to introduce additional problems to legal scholarship, New Institutional Economics neatly matches law’s own methodological tenets. However, the analysis will remain incomplete unless a third element is added to the mix: comparative law. Thus, the author calls for the development of Comparative Institutional Law and Economics, which provides an improved explanatory methodology.

Introduction to the special issue on the future of institutional and evolutionary economics

2014 ◽  
Vol 10 (4) ◽  
pp. 513-540 ◽  
Author(s):  
GEOFFREY M. HODGSON ◽  
J. W. STOELHORST
Keyword(s):  
Historical Perspective ◽  
Institutional Economics ◽  
Evolutionary Economics ◽  
Research Programme ◽  
New Institutional Economics ◽  
Special Issue ◽  
The Future ◽  
The Common

Abstract: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.

Neoclassical economics and new institutional economics

2015 ◽  
Vol 33 (5) ◽  
pp. 412-429 ◽  
Author(s):  
Alirat Olayinka Agboola
Keyword(s):  
Real Estate ◽  
Design Methodology ◽  
Institutional Economics ◽  
New Institutional Economics ◽  
Economic Thought ◽  
Neoclassical Economics ◽  
Property Market ◽  
Content Type ◽  
Representative Study ◽  
Philosophical Orientations

Purpose – The purpose of this paper is to examine the provisions of both the neoclassical economics and new institutional economics theses and assesses the implications of their methodologies for property market analysis. Design/methodology/approach – This research is based on secondary literature review and desk-based study. Findings – It is argued that new institutional economics, grounded on firmer foundations of human behaviour, offers an analytical approach to the study of the property market which emphasizes the institutionally contingent nature of real estate exchange, thus placing real estate within its socio-economic context. Originality/value – In-depth examination and juxtaposition of the provisions, assumptions, philosophical orientations and limitations of these main traditions of economic thought towards the achievement of a representative study of the workings of the property market.

From Old Institutional Economics to New Institutional Economics

2020 ◽  
pp. 1-24
Author(s):  
Ilkben Akansel
Keyword(s):  
Institutional Economics ◽  
New Institutional Economics ◽  
Neoclassical Economics ◽  
Left Wing ◽  
Historical Aspect ◽  
Mainstream Economics ◽  
The Us

Since different kinds of economics thoughts have been explored, few have been as peculiar as Old Institutional Economics (OIE) and New Institutional Economics (NIE). It is curious that almost every stream criticizing mainstream economics has a left wing. OIE, not a big fan of this, criticizes neoclassical economics/mainstream economics, given it arose in the US. OIE had no sense to left wing, on the contrary, it created an effect criticizing neoclassical economics in its core. Unlike OIE, NIE has many common points with neoclassical economics. NIE has several new aspects different from neoclassical economics, as it has chosen a completely different path than OIE. In this chapter, authors scrutinize circumstances that led to OIE, and what separated OIE and NIE. A brief, successively historical aspect is also provided.

Pouring Water out of the Tub, Do not Forget the Baby! (On the Correlation of Antimonopoly Policy and Economic Development)

2003 ◽  
pp. 111-119 ◽  
Author(s):  
A. Shastitko
Keyword(s):  
Economic Development ◽  
Comparative Analysis ◽  
Property Rights ◽  
Transaction Costs ◽  
Institutional Economics ◽  
Mutual Exclusion ◽  
New Institutional Economics ◽  
Constructive Criticism ◽  
Bundle Of Rights ◽  
Analytical Tools

Key arguments on mutual exclusion of antimonopoly policy and economic development are criticized in the article. Analytical tools of the New Institutional Economics are used to identify the background of antimonopoly policy: property rights as a bundle of rights, externalities, transaction costs, comparative analysis of discrete structural alternatives. Perspective directions of constructive criticism and development of antimonopoly policy have been indicated.

scholarly journals Behavioural Economics and Economic Behaviour in Classical Athens

2018 ◽  
pp. 15-46 ◽  
Author(s):  
David Lewis
Keyword(s):  
Economic Development ◽  
Economic Activity ◽  
Institutional Economics ◽  
Behavioural Economics ◽  
New Institutional Economics ◽  
Point Of View ◽  
Homo Economicus ◽  
Economic Behaviour ◽  
Analytical Tools

This chapter analyses the motivations of economic actors in classical Athens from the point of view of modern behavioural economics. The (now) old orthodoxy of M.I. Finley, drawing on Bücher and Weber, stressed that the so‐ called homo economicus did not exist until recent times: in antiquity, an anti‐productive mentality was essentially hard‐wired into the minds of elite Greeks and Romans, preventing economic development. This approach has been widely rejected in recent years, and in particular the methods of New Institutional Economics (NIE) have provided a way around the moribund formalist‐primitivist debate. Yet whilst NIE has provided a set of important analytical tools, it would be an exaggeration to claim that these tools can solve every problem relating to economic activity in antiquity; here, the insights of behavioural economics can assist us in understanding economic activity in past societies.

The Poverty of Clio

2011 ◽  
Author(s):  
Francesco Boldizzoni
Keyword(s):  
Social Sciences ◽  
Economic History ◽  
Institutional Economics ◽  
New Institutional Economics ◽  
Economic Behavior ◽  
The Social ◽  
Economic Reasoning ◽  
Analytical Tools ◽  
True Relationship ◽  
Choice Approach

This book challenges the hold that cliometrics—an approach to economic history that employs the analytical tools of economists—has exerted on the study of our economic past. This book calls for the reconstruction of economic history, one in which history and the social sciences are brought to bear on economics, and not the other way around. The book questions the appeal of economics over history—which it identifies as a distinctly American attitude—exposing its errors and hidden ideologies, and revealing how it fails to explain economic behavior itself. The book shows how the misguided reliance on economic reasoning to interpret history has come at the expense of insights from the humanities and has led to a rejection of valuable past historical research. Developing a better alternative to new institutional economics and the rational choice approach, the book builds on the extraordinary accomplishments of twentieth-century European historians and social thinkers to offer fresh ideas for the renewal of the field. Economic history needs to rediscover the true relationship between economy and culture, and promote an authentic alliance with the social sciences, starting with sociology and anthropology. It must resume its dialogue with the humanities, but without shrinking away from theory when constructing its models. This book demonstrates why history must exert its own creative power on economics.

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