----------------- HES POSTING ----------------- Building on Mayhew and Yonay, I offer the following theses: 1. The old institutionalism of Ely and Commons conceived of the economy as an institutional construct. The distinctive empirical research methodology of old institutionalism, comparative institutions and the historical method, were both adopted mainly as ways of understanding how institutions worked, and consequently how the larger economy worked. 2. The purpose of understanding was evaluation and improvement. What works well, and what would work better? In this regard, the old institutionalism was the economic wing of progressivism, and had deep roots in American pragmatism. The purpose of economics as a science was to help us solve the economic problems we face as a society. 3. The ambitions of institutionalism as an intellectual movement arose out of the ambitions of the university and the government as social institutions. The subsequent enormous enlargement of both must, therefore, be regarded as a huge victory for institutionalism. But with victory came the institutionalization of institutionalism, as universities set themselves the task of producing candidates to meet the demand of the burgeoning government and quasi-government bureaucracies (and the expanding higher education industry). 4. The division of (intellectual) labor is limited by the extent of the market. The widening market for economists fostered specialization, and the insecurity that comes with it. Different specializations found economic security in different ecological niches-research universities, public policy schools, business schools, research organizations, foundations, government research staff, liberal arts colleges. Some of these niches proved more hospitable than others to research in the style of the old institutionalism. 5. The union card for entering any of these niches has remained the PhD degree which has remained under the control of the research universities, even though less than half of economics PhDs enter academia (and even fewer stay). I gather, from other contributions to this discussion, that there is general agreement that the research university has not been terribly hospitable to research in the style of the old institutionalism, at least insofar as it has not put much energy into training students to continue that style. Given the history I have recounted, I think we should ask, Why not? Perry Mehrling ------------ FOOTER TO HES POSTING ------------ For information, send the message "info HES" to [log in to unmask]