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Market institutions and economic evolution

Author

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  • Brian J. Loasby

    () (Department of Economics, University of Stirling, Stirling FK9 4LA, UK)

Abstract

Our cognitive limitations cause us to rely on institutions to guide reasonable behaviour; market institutions reduce the costs of search, negotiation, and monitoring entailed in making single transactions. The making of markets requires an investment of immaterial capital, the major share of which typically is provided by those who expect to be very active on one side of the market. This `external organisation' provides producers with information for the development of new products; by simplifying transactions it also allows consumers greater scope for developing consumption capabilities. Thus the evolution of institutions guides the evolution of goods and services.

Suggested Citation

  • Brian J. Loasby, 2000. "Market institutions and economic evolution," Journal of Evolutionary Economics, Springer, vol. 10(3), pages 297-309.
  • Handle: RePEc:spr:joevec:v:10:y:2000:i:3:p:297-309
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    References listed on IDEAS

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    Cited by:

    1. Nikolay Nenovsky & Yorgos Rizopoulos, 2004. "Peut-on mesurer le changement institutionnel du régime monétaire ?," Revue d'Économie Financière, Programme National Persée, vol. 75(2), pages 17-36.
    2. Consoli, Davide & Patrucco, Pierpaolo, 2004. "The Knowledge Trade-Off: Circulation, Growth and the Role of Knowledge-Intensive Business Services in Urban Innovation Systems," Department of Economics and Statistics Cognetti de Martiis LEI & BRICK - Laboratory of Economics of Innovation "Franco Momigliano", Bureau of Research in Innovation, Complexity and Knowledge, Collegio 200402, University of Turin.
    3. Filipe J. Sousa & Luís M. de Castro, 2008. "How is the relationship significance brought about? A critical realist approach," FEP Working Papers 282, Universidade do Porto, Faculdade de Economia do Porto.
    4. Anders Malmberg & Peter Maskell, 2006. "Localized Learning Revisited," Growth and Change, Wiley Blackwell, vol. 37(1), pages 1-18.
    5. Davide Consoli, 2005. "Cash and the Counter: Capabilities and Preferences in the Demand for Banking Technologies," Development and Comp Systems 0511010, EconWPA.
    6. Davide Consoli, 2005. "Cash and the Counter: Capabilities and Preferences in the Demand for Banking Technologies," Industrial Organization 0511001, EconWPA.
    7. repec:spr:joevec:v:27:y:2017:i:3:d:10.1007_s00191-017-0490-z is not listed on IDEAS
    8. Consoli, Davide, 2005. "The dynamics of technological change in UK retail banking services: An evolutionary perspective," Research Policy, Elsevier, pages 461-480.
    9. Brian J. Loasby, 2001. "Industrial Dynamics Why Connections Matter," DRUID Working Papers 01-09, DRUID, Copenhagen Business School, Department of Industrial Economics and Strategy/Aalborg University, Department of Business Studies.
    10. Nightingale, John J. & Piggott, Roley R. & Griffith, Garry R., 2002. "Explaining Market and Enterprise Structures in the Food Marketing Chain," Working Papers 12939, University of New England, School of Economics.
    11. Eike W. Schamp, 2010. "On the Notion of Co-evolution in Economic Geography," Chapters,in: The Handbook of Evolutionary Economic Geography, chapter 20 Edward Elgar Publishing.
    12. Stan Metcalfe & Dimitri Gagliardi & Nicola De Liso & Ronnie Ramlogan, 2012. "Innovation Systems and Innovation Ecologies: Innovation Policy and Restless Capitalism," Openloc Working Papers 1203, Public policies and local development.
    13. Anders Malmberg & Peter Maskell, 2010. "An Evolutionary Approach to Localized Learning and Spatial Clustering," Chapters,in: The Handbook of Evolutionary Economic Geography, chapter 18 Edward Elgar Publishing.
    14. Hugues Jeannerat & Leila Kebir, 2012. "Mobility of Knowledge. Knowledge resources and markets: What territorial economic systems ?," GRET Publications and Working Papers 02-12, GRET Group of Research in Territorial Economy, University of Neuchâtel.
    15. Nikolay Nenovsky & Yorgos Rizopoulos, 2004. "Measuring the Institutional Change of the Monetary Regime in a Political Economy Perspective (Groups of interest and monetary variables during the Currency Board introduction in Bulgaria)," William Davidson Institute Working Papers Series wp732, William Davidson Institute at the University of Michigan.
    16. Hurrelmann, Annette, 2008. "Analysing agricultural land markets as organisations: An empirical study in Poland," Journal of Economic Behavior & Organization, Elsevier, vol. 67(1), pages 338-349, July.
    17. Oliver Budzinski, 2003. "Cognitive Rules, Institutions, and Competition," Constitutional Political Economy, Springer, pages 213-233.
    18. Christ, Julian P. & Slowak, André P., 2009. "Why Blu-ray vs. HD-DVD is not VHS vs. Betamax: The co-evolution of standard-setting consortia," Violette Reihe: Schriftenreihe des Promotionsschwerpunkts "Globalisierung und Beschäftigung" 29/2009, University of Hohenheim, Carl von Ossietzky University Oldenburg, Evangelisches Studienwerk.
    19. Jason Potts, 2007. "Exchange and evolution," The Review of Austrian Economics, Springer;Society for the Development of Austrian Economics, vol. 20(2), pages 123-135, September.
    20. Davide Consoli, 2005. "Changing boundaries and structure of a technological system: lessons from UK retail banking," Industrial Organization 0506006, EconWPA.
    21. Davide Consoli, 2005. "Changing boundaries and structure of a technological system: lessons from UK retail banking," Development and Comp Systems 0506004, EconWPA.
    22. Geoffrey Hodgson, 2002. "The Evolution of Institutions: An Agenda for Future Theoretical Research," Constitutional Political Economy, Springer, pages 111-127.
    23. Christ, Julian P. & Slowak, André P., 2009. "Why Blu-ray vs. HD-DVD is not VHS vs. Betamax: The co-evolution of standard-setting consortia," Violette Reihe: Schriftenreihe des Promotionsschwerpunkts "Globalisierung und Beschäftigung" 29/2009, University of Hohenheim, Carl von Ossietzky University Oldenburg, Evangelisches Studienwerk.
    24. Smith, Peter, 2004. "Reworking the Standard Model of Competitive Markets: The Role of Fuzzy Logic and Genetic Algorithms in Modelling Complex Non-Linear Economic System," General Discussion Papers 30569, University of Manchester, Institute for Development Policy and Management (IDPM).

    More about this item

    Keywords

    Institutions - Markets - Producers - Consumers - Evolution;

    JEL classification:

    • D1 - Microeconomics - - Household Behavior
    • D2 - Microeconomics - - Production and Organizations
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development

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