Psychology Dictionary of ArgumentsHome
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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._____________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. | |||
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Adam Smith on Institutions - Dictionary of Arguments
Parisi I 269 Institutions/Adam Smith: For Smith, individuals have a natural propensity to “truck, barter and exchange” (Smith, 1981/1776(1), p. 15). The growth in opportunities for exchange is the growth of markets. So, in pursuing exchange, individuals are unintentionally providing greater scope for the division of labor and more general specialization both within and across firms (Smith, 1981/1776(1), p. 31). However, none of this would be possible without the extension and formalization of property and contract law. >Property, >Contract law, >Exchange, >Division of Labour. In dealing with strangers in perhaps far-flung areas, rules may need to become more detailed and more definite. This extension of trade itself creates incentives to modify and adapt existing rules into new legal forms. Merchants will make rule-like agreements to facilitate their trading activity (Benson, 1989)(2). Therefore, the individual Parisi I 270 individual desire to gain from exchange can be seen as the impetus for the development of property and contract law. Law, then, is the spontaneous or unintended consequence of exchange. >A. Smith. 1. Smith, A. (1981/1776). An Inquiry into the Nature and Causes of the Wealth of Nations, Vols. I–V. Indianapolis, IN: Liberty Fund. 2. Benson, B. (1989). “The Spontaneous Evolution of Commercial Law.” Southern Economic Journal 55: 644–661. Rajagopalan, Shruti and Mario J. Rizzo “Austrian Perspectives on Law and Economics.” In: Parisi, Francesco (ed) (2017). The Oxford Handbook of Law and Economics. Vol 1: Methodology and Concepts. NY: Oxford University._____________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. |
EconSmith I Adam Smith The Theory of Moral Sentiments London 2010 EconSmithV I Vernon L. Smith Rationality in Economics: Constructivist and Ecological Forms Cambridge 2009 Parisi I Francesco Parisi (Ed) The Oxford Handbook of Law and Economics: Volume 1: Methodology and Concepts New York 2017 |
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> Counter arguments against Smith
> Counter arguments in relation to Institutions
