This is a ground-breaking book about the foundations of institutional economics. K. William Kapp presents the economic role of institutions for economic development, capital formation and technological dynamics in an easily accessible and comprehensive manner. As a front-rank 20th century institutional economist, Kapp pulls together arguments from a variety of sources, including Thorstein Veblen, John Kenneth Galbraith and Gunnar Myrdal, all of which emphasize the crucial role of institutions. The author cements institutional economics as a distinct and coherent framework of analysis to effectively address urgent socio-economic problems, such as environmental disruption and sustainable development.
This book begins with a critique of conventional (neoclassical) economics and an overview of the antecedents of institutional economics. The core of the book is formed by the chapters on institutions, human economic behavior and needs, arguing that institutional change is key to directing economic development towards sustainable and adequate living conditions, rather than merely formal growth formulas. The final chapters provide the reader with the institutional theories of capital and technology, showing how capital formation and technological dynamics are determined by institutions, such as the principle of investment for profit. The appendix complements Kapp’s plea for institutional change with articles on science and technology, social costs, substantive economics, and circular and cumulative causation.
This book is suited for readers at all levels who are interested in institutional economics, the history of economics thought, political economics as well as ecological and heterodox economics. Researchers and students will find it to be an easily accessible and a concise elaboration on the foundations of institutional economics.
Editorial Introduction 1. Introduction: The Lasting and Increasing Relevance of Institutional Economics 2. Institutional Economics and Conventional Economic Theory 3. The Intellectual Antecedents of Institutional Economics 4. The Nature and Meaning of Institutions: Towards a Theory of Institutional Change 5. The Institutional Theory of Human Conduct and Economic Behavior 6. Towards a Theory of Human Needs and Social Minima 7. The Institutional Concept of Capital and the Process of Capital Formation 8. The Interaction between Technology and Business Enterprise 9. Technology II 10. The Multi-sector Economy and the Theory of Economic Domination Appendix A: Substantive vs. Formal Rationality: Environmental indicators as indicators of social use values Appendix B: The Central Hypothesis of Institutional Economics: Circular and Cumulative Causation Appendix C: Institutionalism and the Price System: The Problem of Social Costs Appendix D: Environment and Technology: New Frontiers for the Social and Natural Sciences Appendix E: Science and Technology in the Light of Institutional Analysis: Governmental Furtherance of Environmentally Sound Technologies as a focus of Research and Environmental Policies Appendix F: Social Economics and Social Welfare Minima Appendix G: In Defense of Institutional Economics Appendix H: Alternative Introductions Appendix I: Project Outline "American Institutionalism: The System of Economic Analysis of Veblen and his Followers"