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New New Institutionalism Institutionalism

New Institutionalism

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What Institutions along with its norms, rules and practices affects the behavior of the of the people.

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Page 1: New Institutionalism

New Institutionalism New Institutionalism

Page 2: New Institutionalism

Definition of New Definition of New InstitutionalismInstitutionalism

Interplay of the different institutions within Interplay of the different institutions within society, and how their dynamics, rules and society, and how their dynamics, rules and norms determine the behavior and actions of norms determine the behavior and actions of individidualsindivididuals

Comes from (old) institutionalism, which is Comes from (old) institutionalism, which is focused on state/government and their various focused on state/government and their various laws and practices which are applied to laws and practices which are applied to citizenscitizens

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OriginsOrigins

Main points of the institutional approach can already be found Main points of the institutional approach can already be found in the writings of Jean-Jacques Rousseauin the writings of Jean-Jacques Rousseau

His criticism of Hobbes, Locke, and others for assuming that the His criticism of Hobbes, Locke, and others for assuming that the behavior of possessive individuals in a particular historical and behavior of possessive individuals in a particular historical and social context expressed the natural preferences and traits of all social context expressed the natural preferences and traits of all human beings is an institutionalist claim that behavior and human beings is an institutionalist claim that behavior and preferences are not a coincident preferences are not a coincident

Rousseau viewed preferences, such as the desire to accumulate Rousseau viewed preferences, such as the desire to accumulate property, not as universal postulates on which one could found a property, not as universal postulates on which one could found a scientific theory (cont.)scientific theory (cont.)

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of politics but as products of society—its norms and its of politics but as products of society—its norms and its institutions. institutions.

““Law and custom shaped men’s preferences and institutionalized Law and custom shaped men’s preferences and institutionalized power and privilege, thus converting natural inequalities into power and privilege, thus converting natural inequalities into more pernicious social inequalities. To discover the true nature more pernicious social inequalities. To discover the true nature of man, untainted by the social order, one would have to imagine of man, untainted by the social order, one would have to imagine men in a presocial state, stripped of all effects of social men in a presocial state, stripped of all effects of social intercourse and even language. To restore the natural freedom of intercourse and even language. To restore the natural freedom of man under modern conditions, Rousseau proposed the social man under modern conditions, Rousseau proposed the social contract. Such a contract would allow men to “find a form of contract. Such a contract would allow men to “find a form of association which will defend and protect with the whole association which will defend and protect with the whole common force the person and goods of each associate, and in common force the person and goods of each associate, and in which each, while uniting himself with all, may still obey which each, while uniting himself with all, may still obey himself alone, and remain as free as before.”himself alone, and remain as free as before.”

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was launched by political scientists March and Olsen in 1984 was launched by political scientists March and Olsen in 1984 as a reaction to behaviouralism and the growing influence of as a reaction to behaviouralism and the growing influence of rational choice theory. rational choice theory.

focuses on the way in which institutions embody values and focuses on the way in which institutions embody values and power relationshipspower relationships

defines institutions themselves as an essential variable in defines institutions themselves as an essential variable in political outcomes. political outcomes.

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March and Olsen(1984): new institutionalism stresses the March and Olsen(1984): new institutionalism stresses the relative autonomy of political institutions. Institutions are relative autonomy of political institutions. Institutions are neither a mirror of society (the behavioural critique), nor neither a mirror of society (the behavioural critique), nor merely the site for individual strategies (as in the rational actor merely the site for individual strategies (as in the rational actor paradigm).paradigm).

Institutions give Institutions give meaningmeaning to interactions and provide the to interactions and provide the context within which interactions take place. context within which interactions take place.

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AssumptionsAssumptions

Three main approaches emerge from the Three main approaches emerge from the terminological morass: terminological morass:

the ‘logic of appropriateness’the ‘logic of appropriateness’ a concern with the weight of past decisions a concern with the weight of past decisions

and processes of automatic governmentand processes of automatic government the attempt to marry methodological the attempt to marry methodological

individualism and institutional designindividualism and institutional design

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Main approachesMain approaches Sociological Sociological or normative institutionalism emphasizes the cultural or normative institutionalism emphasizes the cultural

context within which organizations function and the values with context within which organizations function and the values with which actors are imbued.which actors are imbued.

Historic institutionalism Historic institutionalism emphasizes the importance of initial emphasizes the importance of initial decisions and choices of venues and introduces notions such as that decisions and choices of venues and introduces notions such as that of path dependency; traditions; response to structural-functionalismof path dependency; traditions; response to structural-functionalism

Rational choiceRational choice institutionalism purports that institutions are only institutionalism purports that institutions are only vested with powers by individuals. Rational choice institutionalism vested with powers by individuals. Rational choice institutionalism involves more rational choice than institutionalism, the research involves more rational choice than institutionalism, the research focus being upon how individuals can use institutions to maximize focus being upon how individuals can use institutions to maximize their interest. Institutions, appreciated in an instrumental way, can their interest. Institutions, appreciated in an instrumental way, can be important insofar as they can be designed to limit the be important insofar as they can be designed to limit the consequences of individual behaviour consequences of individual behaviour

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Normative/Sociological Institutionalism Normative/Sociological Institutionalism Normative or sociological institutionalism refers to the codes of Normative or sociological institutionalism refers to the codes of

appropriate behaviour that imbue actors in organisations. appropriate behaviour that imbue actors in organisations. Act upon their perceptions of what is the correct code of Act upon their perceptions of what is the correct code of

behaviour; and they will resist changes from within or outside behaviour; and they will resist changes from within or outside challenge understandings of ‘appropriate behaviour’ especially challenge understandings of ‘appropriate behaviour’ especially when this is linked to the exercise of a specific profession or when this is linked to the exercise of a specific profession or corps.corps.

Actors within organisations are bound by common values, Actors within organisations are bound by common values, which explains not only their propensity to frustrate change, but which explains not only their propensity to frustrate change, but also the capacity for organisations to reproduce themselves. also the capacity for organisations to reproduce themselves.

Normative institutionalism thus frames institutions in terms of Normative institutionalism thus frames institutions in terms of the belief systems of actors, considered as members of a the belief systems of actors, considered as members of a profession/corps/grade, rather than as utility maximising profession/corps/grade, rather than as utility maximising individuals. individuals.

Its underlying assumption is that individuals within Its underlying assumption is that individuals within organisations are conservative, fearful of change and resolute in organisations are conservative, fearful of change and resolute in defence of their interests.defence of their interests.

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Historical institutionalismHistorical institutionalism Need to understand the importance of history in general, and Need to understand the importance of history in general, and

the history of specific policy sectors or public policies in the history of specific policy sectors or public policies in particularparticular

Another is to focus on the sectoral level, and retrace the Another is to focus on the sectoral level, and retrace the history of specific public policies. history of specific public policies.

This sectoral analysis is that favoured by the historical This sectoral analysis is that favoured by the historical institutionalist school. Decisions set sectors on a given path, institutionalist school. Decisions set sectors on a given path, from which a shift is extremely costly in terms past from which a shift is extremely costly in terms past investment. Change can usually only occur in the context of a investment. Change can usually only occur in the context of a paradigm shiftparadigm shift

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In the HI approach, the In the HI approach, the heritageheritage is identified as the principal is identified as the principal independent variable (Rose, Collier notably). Rose (1991) independent variable (Rose, Collier notably). Rose (1991) argues strongly that policy choices are limited by past choices. argues strongly that policy choices are limited by past choices. Incumbent governments can not ignore past commitments that Incumbent governments can not ignore past commitments that are given substance by complex legal systems and pre-existing are given substance by complex legal systems and pre-existing institutions and actor configurations. institutions and actor configurations.

The vast bulk of laws in operation at any one time are not The vast bulk of laws in operation at any one time are not those implemented by the incumbent government. those implemented by the incumbent government.

In a similar argument, Weaver speaks of automatic In a similar argument, Weaver speaks of automatic government and doubts the capacity of governments to government and doubts the capacity of governments to implement change.implement change.

Policy programmes pursue their autonomous development Policy programmes pursue their autonomous development irrespective of the activities of governments in power. The irrespective of the activities of governments in power. The field of social welfare is especially prone to this type of field of social welfare is especially prone to this type of analysis.analysis.

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Rational choice institutionalism Rational choice institutionalism RC institutionalism attempts to marry methodological RC institutionalism attempts to marry methodological

individualism and institutional design (Ostrom) individualism and institutional design (Ostrom) Rational choice focuses on methodological individualism, Rational choice focuses on methodological individualism,

rather than collective, or middle level aggregates. rather than collective, or middle level aggregates. For RC, to understand institutions we need first and foremost For RC, to understand institutions we need first and foremost

to understand individual interactions, specifically the games to understand individual interactions, specifically the games people play.people play.

Rational Choice institutionalism: a market doctrine? Political Rational Choice institutionalism: a market doctrine? Political economists refuse to recognize the State, assume individual is economists refuse to recognize the State, assume individual is an egotistical, self-interested actor an egotistical, self-interested actor

Rational choice institutionalism involves more rational choice Rational choice institutionalism involves more rational choice than institutionalismthan institutionalism

The research focus: how to design institutions in an The research focus: how to design institutions in an instrumental way, so that they can be designed to limit the instrumental way, so that they can be designed to limit the consequences of utility maximizing individual behaviourconsequences of utility maximizing individual behaviour

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ThinkersThinkers

• James MarchJames March Known for his research on organizations and organizational Known for his research on organizations and organizational

decision makingdecision making

• Johan OlsenJohan Olsen One of the developers of the systemic-anarchic perspective of One of the developers of the systemic-anarchic perspective of

organizational decision making known as the Garbage Can organizational decision making known as the Garbage Can Model.Model. He is a prominent thinker and writer on a wide variety He is a prominent thinker and writer on a wide variety of topics, such as new institutionalism and Europeanizationof topics, such as new institutionalism and Europeanization

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• Elinor OstromElinor Ostrom Associated with the new institutional economics and the Associated with the new institutional economics and the

resurgence of political economyresurgence of political economy

• Richard RoseRichard Rose He has conducted research on a wide range of topics, He has conducted research on a wide range of topics,

including the Northern Ireland conflict, EU including the Northern Ireland conflict, EU enlargement, democratization, elections and votingenlargement, democratization, elections and voting

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CritiquesCritiques

“ “New Institutionalism” is often contrasted with ʺOld New Institutionalism” is often contrasted with ʺOld Institutionalism”.Institutionalism”.

-From the point of view of the older institutionalism, new -From the point of view of the older institutionalism, new institutionalism tries to explain institutional change as merely institutionalism tries to explain institutional change as merely another instance of utility maximization. Old institutionalism, on another instance of utility maximization. Old institutionalism, on the contrary, seeks to articulate reasons for institutional change in the contrary, seeks to articulate reasons for institutional change in terms of social and political volitionterms of social and political volition

-It is often said that new institutionalism is at its weakest when -It is often said that new institutionalism is at its weakest when trying to explain the genesis and transformation of institutionstrying to explain the genesis and transformation of institutions

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SourcesSources William H. Riker, “Implications from the Disequilibrium of Majority Rule William H. Riker, “Implications from the Disequilibrium of Majority Rule

for the Study of Institutions,” for the Study of Institutions,” American Political Science Review 74, no. 2 American Political Science Review 74, no. 2 (June 1980): 432-47.(June 1980): 432-47.

Herbert A. Simon, Herbert A. Simon, Administrative Behavior: A Study of Decision-Making Administrative Behavior: A Study of Decision-Making Processes in Administrative Organization, 2d ed. (New York: Macmillan, Processes in Administrative Organization, 2d ed. (New York: Macmillan, 1957 [1945])1957 [1945])

Lynne G. Zucker, “The Role of Institutionalism in Cultural Persistence,” in Lynne G. Zucker, “The Role of Institutionalism in Cultural Persistence,” in Powell and DiMaggio, eds., Powell and DiMaggio, eds., The New Institutionalism in Organizational The New Institutionalism in Organizational Analysis, 83-107Analysis, 83-107