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Institutional Change: A Framework of Analysis

Опубликовано на портале: 05-02-2003
Economics Working Paper Archive at WUSTL. 1994. 
A theory of institutional change is essential for further progress in the social sciences in general and economics in particular, because neo-classical theory (and other theories in the social scientist's tool bag) at present cannot satisfactorily account for the very diverse performance of societies and economies both at a moment of time and over time. North sketches out a framework for analyzing institutions. This framework builds on the economic theory of choice subject to constraints. However it incorporates new assumptions about both the constraints that individuals face and the process by which they make choices within those constraints. Among the traditional neoclassical assumptions that are relaxed are those of costless exchange, perfect information, and unlimited cognitive capabilities. Too many gaps still remain in our understanding of this new approach to call it a theory. North presents a set of definitions, principles, and a structure, which provide much of the scaffolding necessary to develop a theory of institutional change.

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