The Old Institutional School and Labour Market Functions and Policies

Stavros Drakopoulos and Ioannis Katselidis

MPRA Paper from University Library of Munich, Germany

Abstract: The significant role of institutional and non-market factors in the functioning of an economic system was a core theme of the old institutional economists. They also criticised the narrow conception of economic welfare only in terms of efficiency and satisfaction of consumer interests. Instead, they focused on issues related to justice, human self-development and labourers’ welfare. Their conception of the labour market functions is an indicative example of the uniqueness of their approach. In contrast to the standard approach, labour market functioning does not depend only on the price mechanism, but is also affected by other key factors and parameters such as the social norms, several psychological factors and various labour institutions. This chapter seeks to examine and highlight the contribution of the old institutional economics towards labour market functions and policies. After presenting the origins and method of the School, it briefly compares old Institutionalism and early Neoclassical economics focusing on labour market issues. It also discusses the old institutional approach with respect to the collective action and labour market policy. The chapter concludes with Ross-Dunlop debate on labour unions and the case of minimum wages policy in order to emphasize the relevance of early institutional ideas in analysing contemporary labour market issues.

Keywords: Institutional School; Economic Policy; Labour Policy; Labour Market Institutions (search for similar items in EconPapers)
JEL-codes: B15 B25 J08 (search for similar items in EconPapers)
Date: 2021
New Economics Papers: this item is included in nep-his, nep-hme, nep-hpe, nep-lab and nep-pke
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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