Emergence of the Institutional Approach in Political Economy

Over the past two centuries, the process of emergence of the institutional approach in political economy has seen an opposition between two conceptions of the relation existing to between economy and institution. From its foundation until today, orthodox liberal economics has tried to reduce the question of economic institutions to the level of conformitybetween,in theory, a good pure market economy free from disruptive institutions, and, in reality, a concrete economy more or less disturbed by the existing institutions. On the other hand, the various successive heterodox approaches in political economy (Sismondi, Saint-Simon, historicists, Marx, economic sociology, institutionalists) have proposed, each in its own way, a conception of institutional economy. Alone in this tendency, Veblen and Commons have constructed, respectively, an analytical framework with relationship between theory of economic actiop and theory of economic institution.