New Institutional Economics
Peter G. Klein
Baylor University, Department of Entrepreneurship; Norwegian School of Economics, Department of Strategy and Management; Mises Institute
This essay surveys the new institutional economics, a rapidly growing literature combining economics, law, organization theory, political science, sociology, and anthropology to understand social, political, and commercial institutions. This literature tries to explain what institutions are, how they arise, what purposes they serve, how they change, and how they may be reformed. Following convention, I distinguish between the institutional environment (the background constraints, or rules of the game that guide individuals' behavior) and institutional arrangements (specific guidelines designed by trading partners to facilitate particular exchanges). In both cases, the discussion here focuses on applications, evidence, and policy implications.
Number of Pages in PDF File: 48
JEL Classification: D23, D72, L22, L42, O17
Date posted: September 9, 1998