Insights on Ideology, Institutions, and the Limits of Human Judgment

Three insightful quotations from three works which inform the New Institutionalism:

People in all human societies create mental models of reality. These models attribute causality to various factors—oftentimes invisible ones—and their function is to make the world more legible, predictable and easy to manipulate….The sharing of belief and culture improves cooperation by providing common goals and facilitating the cooperative solution of shared problems.

Francis Fukuyama, The Origins of Political Order (2011, 442)


[I]nstitutions create elements of order and predictability. They fashion, enable and constrain political actors as they act within a logic of appropriate action. Institutions are carriers of identities and roles and they are markers of a polity’s character, history and visions. They provide bonds that tie citizens together in spite of the many things that divide them…

Most contemporary theories assume that the mix of rules, routines, norms, and identities that describe institutions change over time in response to historical experience. The changes are neither instantaneous nor reliably desirable in the sense of moving the system closer to some optimum. As a result, assumptions of historical efficiency cannot be sustained.  By “historical efficiency” we mean the idea that institutions become in some sense “better” adapted to their environments and quickly achieve a uniquely optimum solution to the problem of surviving and thriving.  The matching of institutions, behaviors and contexts takes time and have multiple, path- dependent equilibria. Adaptation is less automatic, less continuous, and less precise than assumed by standard equilibrium models and it does not necessarily improve efficiency and survival.

March & Olsen, “Elaborating the ‘New Institutionalism’” 2005


[P]eople rely on a limited number of heuristic principles which reduce the complex tasks of assessing probabilities and predicting values to simpler judgmental operations. In general, these heuristics are quite useful but sometimes they lead to severe and systematic error.

Tversky & Kahneman “Judgment Under Uncertainty: Heuristics and Biases” 1974




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