Institutional Equilibrium and SSA Analysis

Institutional and Organizational Analysis, 2018

Institutions and norms have increasingly been recognized as fundamental determinants of economic and political development. Institutions are rules that recognized authorities create and enforce. Norms are long-standing patterns of behavior, shared by a subset of people in a society or organization. These factors play a role in all organizations, including governments, firms, churches, universities, gangs, and even families. In this book we: (1) present a set of concepts, for example, institutions, norms, property rights, and transaction costs, used in Institutional and Organizational Analysis (IOA) that link institutions and norms to economic performance; (2) use the same set of concepts to better understand political organizations and performance; and (3) build a framework based on those concepts for understanding divergent developmental trajectories of nations around the world. In Parts I and II, we define the concepts needed to understand how economic activity is organized and how economic and political outcomes are shaped by institutions and norms. In Part III, we add the comparatively recent work on beliefs and leadership to better understand the fundamental question of why there has not been convergence in economic and political performance across countries.

2014

The old and the new institutionalisms in institutional economic approach acknowledge the role of institutions as factors influencing economic performance. Although the former builds up its assumptions based on gaps in neoclassical economics, urging economic evolution and dynamics while stressing habits as a key element in the institutional concept, the new economic institutionalism includes in its analysis the concepts of transaction costs and property rights, attempting to explain institutional dynamics through creating efficient solutions. Similarly, in the institutional social approach, the old social institutionalism acknowledges the influence of social interactions on institutions, while its new counterpart supplements it, proposing that the institutional reality is built up by society and the quest for legitimate standing among organizations. This paper presents an integrative and organizing framework for reconciling economic and social outlook of the institutional approach fr...

This theme paper focuses on political institutions and their effects on social choice. Institutions are argued to play a mediating role between the preferences of individuals and social choices. In addition to playing an endogenous role in molding and channeling preferences, institutions prescribe and constrain the set of choosing agents, the manner in which their preferences may be revealed, the alternatives over which preferences are expressed, the order in which such expressions occur, and generally the way in which business is conducted. The paper surveys the relationship between institutional arrangements and equilibrium outcomes in order to assess the importance of institutions for final outcomes. In so doing, we will have some perspective on the degree to which the traditional multidimensional voting model-institution-free and highly atomistic-is an extreme case. Since institutions are not carved in granite, and are themselves the object of choices, it is important to take the next step of determining the durability of institutional arrangements or, on the other hand, the ways they adapt and evolve or atrophy. This will be the subject of the later part of this paper.

2018

This article explicitly deals with and scrutinises what can be perceived to be the core analytical issues and methodological concepts of new institutional economics. New institutionalism seeks to explain not just the origins and evolution of institutions of capitalism, but more generally the scope of the theory is supposed to be universally applicable. Granted this, new institutionalists often interpret the historical emergence and evolution of institutions in abstract logical terms. This is because of the static, timeless, ahistorical and asocial nature of marginalism and neoclassical equilibrium analysis used by new institutionalists. Hence, an attempt is made to propose certain methodological and theoretical premises that can pave the way for the construction of an alternative, qualified theory of institutional arrangements. In this vein, the issues of social structure, social relations, power and conflict come to central stage.

This article explicitly deals with and scrutinises what can be perceived to be the core analytical issues and methodological concepts of new institutional economics. New institutionalism seeks to explain not just the origins and evolution of institutions of capitalism, but more generally the scope of the theory is supposed to be universally applicable. Granted this, new institutionalists often interpret the historical emergence and evolution of institutions in abstract logical terms. This is because of the static, timeless, ahistorical and asocial nature of marginalism and neoclassical equilibrium analysis used by new institutionalists. Hence, an attempt is made to propose certain methodological and theoretical premises that can pave the way for the construction of an alternative, qualified theory of institutional arrangements. In this vein, the issues of social structure, social relations, power and conflict come to central stage.

2011

Notice: Changes introduced as a result of publishing processes such as copy-editing and formatting may not be reflected in this document.

2015

The basis of institutional analysis is that formal institutions (e.g., laws) and informal institutions (e.g. norms) are important determinants of individual and group behavior. Behavior, in turn, affects socio-economic development. In the first part of the course, our initial focus is to take institutions as exogenous and understand how institutions lead to different socio-economic paths of development. After understanding the grand forces at play in shaping development paths, we will explore at a more micro level the outcomes of institutions, e.g. the rights that individuals and groups have to resources (property rights); and the forms of organization of production and exchange (markets and contracts). In Part II of the course, we explore the determinants of formal institutions (interest groups, legislative, executive and judicial branches, and the bureaucracy), taking as fixed the basic constitutional rules and the current realization of economic performance. In part III, we analy...

International Encyclopedia of Organization Studies, 2008

Institutional theory, a building block of today’s organization studies, drawing from sociology, social psychology, political science, and economics, offers explanations for social order, social action and cultural persistence. It does it with regard both to the stability of social systems at various levels (i.e. organization, field, society, world), and to the effects of institutional processes in situations of change or of conflicting legal, cultural or normative jurisdictions. Institutional theory highlights the role of rules, norms, and typifications (cultural beliefs and scripts) in constraining and empowering social action and giving meaning to social life. Earlier contributions emphasized the stabilizing role of institutions through the constitution of structures, organizational forms, fields and social actors’ identities. More recent contributions draw attention to the concurrent role of institutions in situations of change, where interests, agency and power play their own role in reaching stability or domination.

2008

There is grow ing ev id ence tha t in s titu tions m a tter for econom ic grow th . If good ins titu tions can s pur grow th , then try ing to change form al or externa l in s titu tions accord ingly a lm os t s eem s to s ugges t its elf. Yet, externa l in s titu tions w ill on ly provok e the d es ired effect if they are effectively en forced . It is a rgued tha t the effectivenes s of externa l in s titu tions critica lly h inges on com plem en tary in terna l in s titu tions tha t help citiz ens to overcom e the problem of collective action . As s um ing tha t in terna l in s titu ions are ra ther s table, it is a rgued tha t s ocieties have a fa irly res tricted area w ith in w h ich they can im plem en t grow th -end ucing ins titu tiona l change.