Showing papers by "Douglass C. North published in 2004"
TL;DR: In this paper, a broad overview of the interplay among cognition, belief systems, and institutions, and how they affect economic performance is provided, and the authors argue that a deeper understanding of institutions' emergence, their working properties, and their effect on economic and political outcomes should begin from an analysis of cognitive processes.
Abstract: In this article, we provide a broad overview of the interplay among cognition, belief systems, and institutions, and how they affect economic performance. We argue that a deeper understanding of institutions' emergence, their working properties, and their effect on economic and political outcomes should begin from an analysis of cognitive processes. We explore the nature of individual and collective learning, stressing that the issue is not whether agents are perfectly or boundedly rational, but rather how human beings actually reason and choose, individually and in collective settings. We then tie the processes of learning to institutional analysis, providing arguments in favor of what can be characterized as “cognitive institutionalism.” Besides, we show that a full treatment of the phenomenon of path dependence should start at the cognitive level, proceed at the institutional level, and culminate at the economic level.
301 citations
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TL;DR: In this paper, a broad overview of the interplay among cognition, belief systems, and institutions, and how they affect economic performance is provided, and the authors argue that a deeper understanding of institutions' emergence, their working properties, and their effect on economic and political outcomes should begin from an analysis of cognitive processes.
Abstract: In this article, we provide a broad overview of the interplay among cognition, belief systems, and institutions, and how they affect economic performance. We argue that a deeper understanding of institutions' emergence, their working properties, and their effect on economic and political outcomes should begin from an analysis of cognitive processes. We explore the nature of individual and collective learning, stressing that the issue is not whether agents are perfectly or boundedly rational, but rather how human beings actually reason and choose, individually and in collective settings. We then tie the processes of learning to institutional analysis, providing arguments in favor of what can be characterized as "cognitive institutionalism." Besides, we show that a full treatment of the phenomenon of path dependence should start at the cognitive level, proceed at the institutional level, and culminate at the economic level.
25 citations
Posted Content•
TL;DR: In an earlier essay (North, 1981, Ch. 3) as discussed by the authors, a Neo-Classical Theory of the State was developed, which is explicitly concerned with the perceptions -the belief systems - that determine choices.
Abstract: In an earlier essay (North, 1981, Ch. 3) I developed a Neo-Classical Theory of the State. This essay elaborates, extends and modifies that essay in three directions: 1. It incorporates time into the model; 2. It is explicitly concerned with the perceptions - the belief systems - that determine choices; and 3. It relates the belief systems to the external environment of the players; both the past environmental experiences that are incorporated in cultural conditioning and the present environmental experiences incorporated in local learning.
16 citations