Textbooks for the course are
Alston, Lee J., Eggertsson, Thrainn, and North, Douglass C., eds. Empirical Studies in Institutional Change, Cambridge: Cambridge University Press, 1996. (=AEN)
Drobak, John and Nye, John, editors, Frontiers of the New Institutional Economics, Academic Press 1997 (=DN)
Furubotn, Eirik G. and Richter, Rudolf, Institutions and Economic Theory: The Contribution of the New Institutional Economics, Ann Arbor, Michigan: University of Michigan Press, 1998
A. Economic Theory and the New Institutional Economics
1. Science, methodology, the role of observation, and the need for a broader conception of theory
Feynman, Richard P., Leighton, Robert B., and Sands, Matthew, The Feynman Lectures on Physics, Addison-Wesley, 1963, excerpts
Introduction and first two chapters, North, D. C., “Prologue,” and Fogel, R. W., “Douglass C. North and Economic Theory,” in DN
McCloskey, Deirdre, “Rhetoric of Mathematical Formalism,” Chapter 10 of Knowledge and Persuasion in Economics, Cambridge: Cambridge University Press, 1994
2. Basics
What are institutions?
Relationship to microeconomic theory of variables
and to macroeconomic theory of variables
How do institutions change?
Alston, Lee J., Eggertsson, Thrainn, and North, Douglass C, “Introduction,” in AEN
Eggertsson, Thrainn, “A Note on the Economics of Institutions,” in AEN
Alston, Lee J., “Empirical Work in Institutional Economics: An Overview,” in AEN
Furubotn and Richter, Chapter 1
3. Do economists know that institutions matter?
Rodrik, Dani, Subramanian, Arvind, and Trebbi, Francesco, “Institutions Rule: The Primacy of Institutions over Geography and Integration in Economic Development,” NBER Working Paper 9305, 2002
Keefer, Philip and Shirley, Mary M., “Formal versus Informal Institutions in Economic Development,” in Claude Menard (ed.), Institutions, Contracts, and Organizations: Perspectives from New Institutional Economics, Cheltenham, UK: Edward Elgar, 2000
B. Political Economy
Public Choice, Property Rights, and Political Science
Libecap, Gary, “Economic Variables and the Development of the Law,” in AEN
Ensminger, J., “Changing Property Rights: Reconciling Formal and Informal Rights to Land in Africa,” in DN
Weingast, B. R., “The Political Foundations of Limited Government: Parliament and Sovereign Debt in 17th- and 18th-Century England,” in DN
Krueger, “Anne O., “The Political Economy of Controls: American Sugar,” in AEN
Higgs, Robert, “Legally Induced Technical Regress in the Washington Salmon Fishery,” in AEN
Furubotn and Richter, Chapter 3
C. Implications of New Institutional Economics for Economic History
Hoffman, P. T. and Rosenthal, J.-L., “The Political Economy of Warfare and Taxation in Early Modern Europe: Historical Lessons for Economic Development,” in DN
Greif, A., “On the Interrelations and Economic Implications of Economic, Social, Political and Normative Factors: Reflections From Two Late Medieval Societies,” in DN
North, Douglass C. and Weingast, Barry R., “Constitutions and Commitment: The Evolution of Institutions Governing Public Choice in Seventeenth-Century England,” in AEN
Nye, John, War, Wine, and Taxes, work in progress, excerpts
D. New Institutional Economics and the Analysis of Political Struggle
War and Conflict in Economic Perspective
Unsolved Problems, New Speculations
Nye, J.V.C., “Thinking About the State: Property Rights, Trade, and Changing Contractual Arrangements in a World with Coercion,” in DN
Alston, L.J., Libecap, G.D., and Mueller, B., “Violence and the Development of Property Rights to Land in the Brazilian Amazon,” in DN
Furubotn and Richter, Chapters 6 and 9
Schofield, Norman, “Institutional Innovation, Contingency and War: A Review” in Social Choice and Welfare17 (June 2000), 463-479
Schofield, Norman, “Constitutional Political Economy: Rational Choice Theory and Comparative Politics,” Annual Review of Political Science 3 (July 2000), 277-303
Nye, John, “Killing Private Ryan: An Institutional Analysis of Strategy and Military Procurement in World War II,” work in progress
E. A Brief Introduction to Managerial Issues in Organization
Miller, Gary, Managerial Dilemmas: The Political Economy of Hierarchy, Cambridge: Cambridge University Press, 1992, excerpts
Williamson, Oliver E., The Mechanisms of Governance, New York: Oxford University Press, 1996, excerpts
Furubotn and Richter, Chapters 2, 5, 8
A. The Process of Economic Change
1. Rationality, cognition, and choices
North, Douglass C. and Knight, Jack, “Explaining Economic Change: The Interplay Between Cognition and Institutions,” Legal Theory 3:3 (1997)
North, Douglass C. and Denzau, Arthur T., “Shared Mental Models,” Kyklos 47:1 (1994), 3-31
Clark, A., “Economic Reason: The Interplay of Individual Learning and External Structure,” in DN
David, P.A. and Sanderson, W.C., “Making Use of Treacherous Advice: Cognitive Process, Bayesian Adaptation, and the Tenacity of Unreliable Knowledge,” in DN
2. Belief systems, culture, and cognitive science
North, Douglass C., “Hayek’s Contribution to Understanding the Process of Economic Change,” in Viktor Vanberg, editor, Freiheit, Wettbewerb und Wirtschaftsordnung, Freiburg i.Br.: Rudolf Haufe Verlag, 1999
Vanberg, “Cultural Evolution, Collective Learning, and Constitutional Design” 1994 in: Reisman, D., editor., Economic Thought and Political Theory, Boston: Kluwer Academic Publishers, 1994, 171-204
3. Institutional change
Heiner, Ronald A., “The Origin of Predictable Behavior,” American Economic Review 73:4 (September 1983), 560-595
Cox, Gary W. and McCubbins, Mathew D., “The Institutional Determinants of Policy Outcomes,” in Haggard, Stephan and McCubbins, Mathew D., editors, Presidents, Parliaments, and Policy, Cambridge: Cambridge University Press, 2000
North, Douglass C., “A Transactions Cost Theory of Politics,” Journal of Theoretical Politics 2:4 (1990), 355-367
4. The process of economic change
North, Douglass C., “Institutions,” Journal of Economic Perspectives 5:1. (Winter 1991), 97-112
Eggertsson, Thrainn, “Norms in Economics, with special reference to Economic Development,” in Hechter, Michael and Opp, Karl-Dieter, editors, Social Norms, New York: Russell Sage Foundation, 2001, pp. 76-104
Greif, Avner, “Cultural Beliefs and the Organization of Society: A Historical Reflection on Collectivist and Individualistic Societies,” Journal of Political Economy 102:5 (October 1994), 912-950
B. Economic Development
North, Douglass C, Summerhill, William, and Weingast, Barry R., “Order, Disorder, and Economic Change: Latin America vs. North America,” in Bueno de Mesquita, Bruce and Root, Hilton, editors, Governing for Prosperity, New Haven: Yale University Press, 2000
Haber, Stephen, Introduction and Chapter 3 in Haber, Stephen, editor, Introduction to Political Institutions and Economic Growth in Latin America, Stanford: Hoover Institution Press, Stanford University, 2000
Three case studies: Russia, China, and Venezuela