On the survival of imperfect institutions

Thrainn Eggertsson ()
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Thrainn Eggertsson: Department of Economics, University of Iceland, Iceland/Department of Politics, New York University,

Revista de Analisis Economico – Economic Analysis Review, 2006, vol. 21, issue 2, 13-24

Abstract: When social structures are stable and social systems yield expected and desirable results, there is relatively less demand for institutional economics than during times of change. Surge of interest in institutional analysis usually comes during times when countries contemplate basic reform. The 1980s and early 1990s were such a period. NIE offered a fresh way of thinking about economic organization and its broader social context and immediately caught the attention of reformers. Yet the original contributions rarely dealt explicitly with institutional policy. This paper is concerned with the lessons of NIE for major reform or institutional policy. I particularly emphasize opportunities and limits for reform that reflect the knowledge problem as well as political and social responses to reform. Social science has not developed a comprehensive theory of social systems; rather we have accumulated bits of useful insights, often without explicitly knowing in what circumstances the insights apply. The main purpose of this paper is to discuss the lessons of modern institutional theory for institutional reform.

Keywords: Institutional Reform; Social Technologies; Knowledge Problem; Political and Social Reaction. (search for similar items in EconPapers)
JEL-codes: D23 H1 (search for similar items in EconPapers)
Date: 2006
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Citations: View citations in EconPapers (4)

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