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Institutions and Economic Theory

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  • Douglass C. North

Abstract

Editor’s Introduction Originally published in Volume 36, Number 1, Spring 1992, pages 3-6 . Omicron Delta Epsilon presented Douglass North (1920-2015) with the John R. Commons award in 1992 for his contributions to the economics profession. The following year he shared the Nobel Memorial Prize in Economic Sciences with Robert Fogel. The Nobel honored their work in applying economic theory and quantitative methods to the study of economic history and institutional change. As a pioneer in what has become known as cliometrics (named for the classical muse of history, Clio), Professor North’s scholarship focused on how human institutions and their organizational structures influence economic and societal outcomes. He is widely recognized as one of the founders of the New Institutional Economics school of thought. In this paper, his Commons Award lecture, Professor North describes and discusses his views on the limitations of neoclassical economics that are rooted in the assumption of instrumental rationality. His discourse on culturally influenced mental models and the limitations of our ability to process complex information presages the ongoing revolution in behavioral economics. This paper remains as timely today as it did when it first appeared in The American Economist .
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  • Douglass C. North, 1992. "Institutions and Economic Theory," The American Economist, Sage Publications, vol. 36(1), pages 3-6, March.
    • Handle: RePEc:sae:amerec:v:36:y:1992:i:1:p:3-6
    DOI: 10.1177/056943459203600101
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    References listed on IDEAS

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    1. R. H. Coase, 2013. "The Problem of Social Cost," Journal of Law and Economics, University of Chicago Press, vol. 56(4), pages 837-877.
    2. Hahn, F H, 1987. "Information, Dynamics and Equilibrium," Scottish Journal of Political Economy, Scottish Economic Society, vol. 34(4), pages 321-334, November.
    3. Douglass C. North, 1990. "A Transaction Cost Theory of Politics," Journal of Theoretical Politics, , vol. 2(4), pages 355-367, October.
    4. Hahn, Frank, 1991. "The Next Hundred Years," Economic Journal, Royal Economic Society, vol. 101(404), pages 47-50, January.
    5. Stanley L. Engerman & Robert E. Gallman, 1986. "Long-Term Factors in American Economic Growth," NBER Books, National Bureau of Economic Research, Inc, number enge86-1.
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    14. Krista B. Lewellyn & Maureen I. Muller-Kahle, 2016. "The configurational effects of board monitoring and the institutional environment on CEO compensation: a country-level fuzzy-set analysis," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 20(4), pages 729-757, December.
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