Economics Dictionary of Arguments

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Institutions: Institutions are social structures that organize and guide human behavior. They can be formal or informal, and they can be public or private.
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Annotation: The above characterizations of concepts are neither definitions nor exhausting presentations of problems related to them. Instead, they are intended to give a short introduction to the contributions below. – Lexicon of Arguments.

 
Author Concept Summary/Quotes Sources

John Rawls on Institutions - Dictionary of Arguments

I 55
Def Institution/Institutions/Rawls: an institution is a public regulatory system that defines administrative bodies and roles together with their rights and obligations, powers of attorney and inviolabilities, etc. The rules include certain penalties and defensive measures, etc. As examples of institutions or, more generally, social practices, we can consider games and rituals, court proceedings and parliaments, markets and property systems. An institution can be considered in two different ways:
a) as an abstract control system
b) as realization in thinking and acting of certain persons at certain times and places.
When it comes to finding out whether an institution is in law or not, it is best to look at the concrete action.
I 56
We assume that those who act within an institution are aware of the rules and results of their practice and assume that other participants have this awareness as well. Although not always true, this is a plausible generalization. There is then a common basis for determining common expectations. For contract theory, it is important to assume that the principles are public and known.
>Principle/Rawls
.
Rules/strategies: we need to distinguish between the rules of an institution and the strategies that the institution may use to achieve its objectives(1).
Strategies: Strategies based on mutual assumptions about each other are not part of the institution. Rather, they belong to the theory of the institution, e. g. Parliament.
Theory: adopts the valid rules as given and analyzes the way power is distributed in the system...
I 57
...and how the parties involved use their opportunities.
Behavior: the behaviour of individuals should be coordinated as far as possible so that the results are the best from the point of view of social justice, even if the individuals may not be aware of them.
J. Bentham: sees this as an artificial identification of interests(2).
>J. Bentham.
Adam Smith: understands this as the work of the Invisible Hand(3).
>A. Smith.
We must distinguish the institution from the rules and these rules from the social system, because each of them can be unfair without the others being unfair. Inequalities can also only arise from the combination of these elements.
I 58
Rituals/Rawls: however, are not called unfair.
Formal law/Rawls: let us assume that there is a valid system of rules that are reliably applied by the institution, even if we ourselves do not accept the rules. Then we can speak of a formal right. The law and the institution are then inseparable from each other.
>Law.

1. See also J. R. Searle Speech Acts, Cambridge, 1969, pp.33-42.
2. See E. Halévy, La Formation du radicalisme philosophique, vol. 1, Paris 1901, pp.2-24.
3. See A. Smith The Wealth of the Nations, (Ed. Edwin Cannan) New York, 1937.

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Explanation of symbols: Roman numerals indicate the source, arabic numerals indicate the page number. The corresponding books are indicated on the right hand side. ((s)…): Comment by the sender of the contribution. Translations: Dictionary of Arguments
The note [Concept/Author], [Author1]Vs[Author2] or [Author]Vs[term] resp. "problem:"/"solution:", "old:"/"new:" and "thesis:" is an addition from the Dictionary of Arguments. If a German edition is specified, the page numbers refer to this edition.

Rawl I
J. Rawls
A Theory of Justice: Original Edition Oxford 2005


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