The Economic Value of Ideology

Universidad del CEMA, Serie Documentos de Trabajo - No. 378

18 Pages Posted: 18 Sep 2008

Date Written: August 2008


Specialization and trade rest on institutions that protect property rights and enforce agreements. Frequently, in economic analysis institutions are just assumed to exist, or it is implicitly supposed that the political game can establish them. Once this assumption is done, the invisible hand does its work properly. It doesn't matter if humans beings are benevolent or selfish for the gains from specialization and trade be realized. However, it is not easy to build institutions, neither are they a free lunch. The paper shows that ideology, understood as a self-imposed code of conduct, contributes to reduce the cost of instituting an industrious society, inducing people to assign their time and effort to productive activities rather than to theft.

Keywords: ideology, self-imposed codes of conduct, crime, enforcement of property rights

JEL Classification: K42, Z13

Suggested Citation

Torrens, Gustavo, The Economic Value of Ideology (August 2008). Universidad del CEMA, Serie Documentos de Trabajo - No. 378, Available at SSRN: or

Gustavo Torrens (Contact Author)

Indiana university ( email )

Wylie Hall, 100 S Woodland Ave
Bloomington, IN 47405-7104
United States
8128568131 (Phone)
47405-7104 (Fax)

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