IDEAS home Printed from https://ideas.repec.org/p/wpa/wuwpeh/9411004.html
   My bibliography  Save this paper

Institutions Matter

Author

Listed:
  • Douglass C. North

    (Washington University)

Abstract

Successful development policy entails an understanding of the dynamics of economic change if the policies pursued are to have the desired consequences. And a dynamic model of economic change entails as an integral part of that model analysis of the polity since it is the polity that specifies and enforces the formal rules. While we are still some distance from having such a model the structure that is evolving in the new institutional economics, even though incomplete, suggests radically different development policies than those of either traditional development economists or orthodox neo- classical economists. Development economists have typically treated the state as either exogenous or as a benign actor in the development process. Neo-classical economists have implicitly assumed that institutions (economic as well as political) don't matter and that the static analysis embodied in allocative-efficiency models should be the guide to policy; that is "getting the prices right" by eliminating exchange and price controls. In fact the state can never be treated as an exogenous actor in development policy and getting the prices right only has the desired consequences when you already have in place a set of property rights and enforcement that will then produce the competitive conditions that will result in efficient markets.

Suggested Citation

  • Douglass C. North, 1994. "Institutions Matter," Economic History 9411004, University Library of Munich, Germany.
  • Handle: RePEc:wpa:wuwpeh:9411004
    Note: ascii text, PostScript available, 2117 words
    as

    Download full text from publisher

    File URL: https://econwpa.ub.uni-muenchen.de/econ-wp/eh/papers/9411/9411004.pdf
    Download Restriction: no

    File URL: https://econwpa.ub.uni-muenchen.de/econ-wp/eh/papers/9411/9411004.ps.gz
    Download Restriction: no

    Citations

    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Institutions, revolutions and growth
      by chris dillow in Stumbling and Mumbling on 2011-07-16 17:47:23
    2. Institutional economics hypothesis of the day
      by UDADISI in udadisi on 2011-10-07 06:13:00

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Amable, Bruno, 1999. "Institutional complementarity and diversity of social systems of innovation and production," Discussion Papers, Research Unit: Economic Change and Employment FS I 99-309, Social Science Research Center Berlin (WZB).
    2. Smith, Kip & Dickhaut, John, 2005. "Economics and emotion: Institutions matter," Games and Economic Behavior, Elsevier, vol. 52(2), pages 316-335, August.
    3. Krammer, Sorin M.S., 2015. "Do good institutions enhance the effect of technological spillovers on productivity? Comparative evidence from developed and transition economies," Technological Forecasting and Social Change, Elsevier, vol. 94(C), pages 133-154.
    4. Hosseini, Hossein Mirshojaeian & Kaneko, Shinji, 2013. "Can environmental quality spread through institutions?," Energy Policy, Elsevier, vol. 56(C), pages 312-321.
    5. Koen, Carla I., 2004. "The dialectics of globalization: what are the effects for management and organization in Germany and Japan," Research in International Business and Finance, Elsevier, vol. 18(2), pages 173-197, June.

    More about this item

    JEL classification:

    • N - Economic History

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wpa:wuwpeh:9411004. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (EconWPA). General contact details of provider: https://econwpa.ub.uni-muenchen.de .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.