Institutions are neither autistic maximizers nor flocks of birds: self-organization, power and learning in human organizations

Giovanni Dosi, Luigi Marengo and Alessandro Nuvolari

Chapter 13 in Institutions and Evolution of Capitalism, 2019, pp 194-213 from Edward Elgar Publishing

Abstract: It is useful to distinguish two explanatory strategies in institutional economics: either institutions are derived from the choices of rational individuals with well-defined preferences, or preferences and indeed the very idea of rationality are derived from institutions. On the first view, institutions are crafted to perform coordinating and governance functions that enhance efficiency by mitigating contracting problems. On the latter, institutions reproduce path-dependently in a partly self-organizing process, irrespective of efficiency considerations. These differences translate into contrasting views of such key concepts as hierarchy, power, knowledge and learning in organizations. Given that each type of explanation contains a grain of truth, the challenge is to connect them. In line with empirical evidence regarding the influence of institutional arrangements on techno-economic change, the chapter calls for an ambitious research programme that addresses the coevolution of organizations, forms of rationality, preferences and technologies.

Keywords: Economics and Finance (search for similar items in EconPapers)
Date: 2019
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Related works:
Working Paper: Institutions Are neither Autistic Maximizers nor Flocks of Birds: Self-organization, Power, and Learning in Human Organizations (2016)
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