topic institutional ★ seed
New Institutional Economics
Coase, North, and Williamson integrated institutions into neoclassical analysis. Transaction costs, property rights, and institutional design explain why firms exist and economies diverge.
#new-institutional
#transaction-costs
#property-rights
#governance
Sub-topics
Douglass North concept
Nobel laureate (1993). Showed that institutions — formal rules and informal norms — are the primary determinant of long-run economic performance. Path dependence shapes institutional evolution.
Ronald Coase concept
Nobel laureate (1991). The Nature of the Firm (1937) asked why firms exist — answer: to minimize transaction costs. The Coase theorem shows that clear property rights can solve externalities without regulation.