Conceptualizing Institutions And Organizations: A Critical Approach

Abstract

<p class="maintext" style="text-align: justify; margin: 0in 34.2pt 0pt 0.5in;"><span style="font-family: Times New Roman;"><span style="font-size: 10pt;" lang="BG">This paper review</span><span style="font-size: 10pt; mso-ansi-language: EN-US;">s</span><span style="font-size: 10pt;" lang="BG"> the concept of institutions and its relationship to capitalist development as used in the field of NIE and compare</span><span style="font-size: 10pt; mso-ansi-language: EN-US;">s</span><span style="font-size: 10pt;" lang="BG"> it to the use of the concept by Hall and Soskice. </span><span style="font-size: 10pt; mso-ansi-language: EN-US;">B</span><span style="font-size: 10pt;" lang="BG">y specifying exactly what institutions are, how and why they should be differentiated from organizations, and how they influence transaction and production costs, Douglass North and the NIE articulate the role of institutions in understanding economic development. Hall and Soskice however, reveal</span><span style="font-size: 10pt; mso-ansi-language: EN-US;">s</span><span style="font-size: 10pt;" lang="BG"> a broad and varied use of the concept which ignores one of the key elements of institutions &ndash; enforcement</span><span style="font-size: 10pt; mso-ansi-language: EN-US;"> and</span><span style="font-size: 10pt;"> </span><span style="font-size: 10pt; mso-ansi-language: EN-US;">also </span><span style="font-size: 10pt;" lang="BG">fail</span><span style="font-size: 10pt; mso-ansi-language: EN-US;">s</span><span style="font-size: 10pt;" lang="BG"> to provide a clear differentiation between institutions and organizations which leads to confusions in understanding their specific role</span><span style="font-size: 10pt; mso-ansi-language: EN-US;">s</span><span style="font-size: 10pt;" lang="BG"> in </span><span style="font-size: 10pt; mso-ansi-language: EN-US;">th</span><span style="font-size: 10pt;" lang="BG">e process of development of the two types of economies that the authors define. </span><span style="font-size: 10pt; mso-ansi-language: EN-US;">A varied, imprecise and inconsistent use of the concept may lead to an overestimation of the role of institutions and conversely underestimation of the role of organizations in capitalist development.<span style="mso-spacerun: yes;">&nbsp;</span></span></span></p>