7. Summary and Conclusion
We have seen that the concept of the ‘institution’, interpreted as a coordinating device, is a problematic one. In the world of applied neoclassical economics it can be defined as something not-market. In the world of classical sociology, however, the concept refers to
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a functional part of a real life society. The original institutional economists used the term in accordance with the sociological habit. In this respect, a market is a good example of an institution! We have attempted to shed some light on the differences in terminology. Important variations in methodology appear to be the explanation for the differences in language.
Some important developments took place over the last two decades. The stimulating work of Coase and Williamson led to the rise of the NIE. This approach can best be described as the development of an analytical structure of the economic aspect of the institutional structure of society. Inspiring work by Hodgson has led to a revival of the OIE, which is primarily based on the careful examination of Veblen, Schumpeter and Hayek. More or less the same approach has been adopted under the title of Evolutionary Economics – which focuses particularly on technological development. The OIE and the evolutionary economists reject research strategies that are based on isolated abstractions of different aspects. They prefer empirical research that is based on real life systems and subsystems.
A concise history of the debates concerning the institutions reveals the relevance of the methodological debates. In particular, the following three antagonisms play a principal role: logic versus history (1), micro versus macro (2) and partial versus specific (3).
Scientific development is stimulated predominantly in an atmosphere of open discussion and pluralistic attitude towards different strategic options. Academic education must offer students a sophisticated overview of the different knowledge structures, which are connected to the different research strategies. Also from a didactical point of view the different approaches need each other. Insight into a strategy can be improved by understanding a contrasting strategy. The phenomenon “male” can be clarified by explaining the phenomenon “female”. The same holds true for the difference between young and old and black and white. An exposition of the historical approach adds to one’s insight into the aspect- or logical approaches. The role of the philosophy of social science cannot be overestimated. By forcing scientists to present their work in terms of the PATH- (“paradigm – analysis – theory – hypothesis”) framework, it becomes much easier to compare and contrast theories that must be “learned” by students.
Economics is part of social science. A curriculum must reflect this basic axiom. The same holds for sociology and psychology. They all need a framework, which clarifies their position in the whole. When students want to specialise in economics it goes without saying that relatively much attention must be paid to the economic aspect of human behaviour and the functioning of the subsystem economy. Students who opt for sociology should focus on the social aspect and the functioning of the subsystem society. Students choosing psychology as their specialisation must focus on the psychic aspect of human behaviour. Because the psyche or mind is only analytically distinguished from the body, its physiology is an important part of an empirically oriented psychology.
As we have explained, these three primary aspects can be studied through the development of aspect-systems. Each of these systems has its own political or control system. If we imagine a real life integrated system, it must have a political or control system as well. Cybernetics investigates control systems in general. Political science
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examines the control system of society as a whole, while Management science studies the control of any type of organization. A controller must know which forces to control: therefore, it is apparent that a sophisticated management study must contain a well-developed introduction into the different aspect systems. After a thorough introduction into the different aspects, each management programme can specialise in terms of a particular subsystem, whether it is business, government, the educational sector or the health care sector.
As long as the fundamentals of social science as an integrated discipline are not clear, the design of educational programmes will be a problematic affair. This makes paradigmatic research a very profitable affair.