Advertisement

On the Nature of Economic Evolution: John R. Commons and the Metaphor of Artificial Selection

  • Yngve Ramstad
Part of the Recent Economic Thought book series (RETH, volume 36)

Abstract

In his famous 1898 essay, “Why Is Economics Not An Evolutionary Science?” Thorstein Veblen challenged economists to transform their discipline into an evolutionary science. In order to meet that standard, Veblen insisted, economic theory must be recast as “a theory of a cumulative sequence of economic institutions stated in terms of the process itself” (Veblen, 1919, p. 77). Except for the American institutionalists, most of whom self-consciously embraced Veblen’s “research program,” economists for the most part have ignored Veblen’s plea. Trained in a tradition rooted in the “natural law” perspective of Adam Smith, “mainstream” economists1 have generally conceived of market activity in acultural, ahistorical terms. Indeed, among the major figures in mainstream 20th-century economics, only Joseph Schumpeter has seen a need to incorporate an explicitly evolutionary stance into economic analysis.

Keywords

Natural Selection Collective Action Biological Evolution Social Institution Evolutionary Approach 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

References

  1. Alchian, A.A. 1950. “Uncertainty, Evolution and Economic Theory.” Journal of Political Economy 58:211–221.CrossRefGoogle Scholar
  2. Biddle, E. 1991. “The Ideas of the Past as Tools for the Present: The Instrumental Presentism of John R. Commons.” In The Estate of Social Knowledge, edited by Jo Anne Brown and David van Keuren, Baltimore: Johns Hopkins University Press, pp. 84–105.Google Scholar
  3. Bowler, P.J. 1984. Evolution: The History of an Idea. Berkeley, CA: University of California Press.Google Scholar
  4. Boulding, K.E. 1981. Evolutionary Economics. Beverly Hills, CA: Sage Publications.Google Scholar
  5. Boyles, M., and Tilman, R. 1992. “Thorstein Veblen, Edward O. Wilson and Sociobiology: An Interpretation.” Paper presented to the Western Social Science Conference, Denver, Colorado, April, 1992.Google Scholar
  6. Bush, P.D. 1987. “The Theory of Institutional Change.” Journal of Economic Issues 21:1075–1116.Google Scholar
  7. Coase, R.H. 1937. “The Nature of the Firm. Economica (N.S.) 4:386–405.CrossRefGoogle Scholar
  8. Coase, R.H. 1960. “The Problem of Social Cost.” Journal of Law and Economics 3:1–44.CrossRefGoogle Scholar
  9. Commons, J.R. 1897. “Natural Selection, Social Selection, and Heredity.” The Arena 18:90–97.Google Scholar
  10. Commons, J.R. 1924. Legal Foundations of Capitalism. New York: Macmillan.Google Scholar
  11. Commons, J.R. 1931. “Institutional Economics.” American Economic Review 21:648–657.Google Scholar
  12. Commons, J.R. 1934. Institutional Economics: Its Place in Political Economy. New York: Macmillan.Google Scholar
  13. Darwin, C. 1972 [1875]. The Variation of Animals and Plants Under Domestication, 2nd ed., reprint. New York: AMS Press, Inc.Google Scholar
  14. Demsetz, H. 1967. “Toward a Theory of Property Rights.” American Economic Review, Papers and Proceedings 57:347–359.Google Scholar
  15. Diesing, P. 1971. Patterns of Discovery in the Social Sciences. Chicago: Aldine Atherton.Google Scholar
  16. Dugger, W.M. 1983. “The Transaction Cost Analysis of Oliver E. Williamson: A New Synthesis?” Journal of Economic Issues 17:95–114.Google Scholar
  17. Dugger, W.M. 1989. “Radical Institutionalism: Basic Concepts.” In Radical Institutionalism: Contemporary Voices, W.M. Dugger, ed. Westport, CT: Greenwood Press, pp. 1–20.Google Scholar
  18. Eff, E.A. 1989. “History of Thought as Ceremonial Genealogy: The Neglected Influence of Herbert Spencer on Thorstein Veblen.” Journal of Economic Issues 23:689–716.Google Scholar
  19. Eggertsson, T. 1990. Economic Behavior and Institutions. New York: Cambridge University Press.Google Scholar
  20. Ellickson, R.C. 1989. “Bringing Culture and Human Frailty to Rational Actors: A Critique of Classical Law and Economics.” Chicago-Kent Law Review 23:23–55.Google Scholar
  21. Enke, S. 1951. “On Maximizing Profits: A Distinction between Chamberlin and Robinson.” American Economic Review 41:566–578.Google Scholar
  22. Fried, C. 1982. “Comments on Hirshleifer Paper.” Research in Law and Economics, Vol. 4. Richard O. Zerbe, Jr., ed. Greenwich, CT: JAI Press, pp. 61–65.Google Scholar
  23. Friedman, M. 1953. “The Methodology of Positive Economics.” In Essays in Positive Economics. Chicago: University of Chicago Press, pp. 3–43.Google Scholar
  24. Galbraith, J.K. 1973. “Power and the Useful Economist.” American Economic Review 63:1–11.Google Scholar
  25. Gould, S.J. 1980. “Hyena Myths and Realities.” In Hen’s Teeth and Horse’s Toes: Further Reflections in Natural History. New York: W.W. Norton & Company, pp. 147–157.Google Scholar
  26. Gould, S.J., and Lewontin, R.C. 1979. “The Spandrels of San Marco and the Panglossian Paradigm: A Critique of the Adaptionist Programme.” Proceedings of the Royal Society of London B205:581–598.CrossRefGoogle Scholar
  27. Hamilton, D. 1970. Evolutionary Economics: A Study of Change in Economic Thought. Albuquerque, NM: University of New Mexico Press.Google Scholar
  28. Hamilton, W. 1932. “Institution.” In Encyclopaedia of the Social Sciences, Vol. VEIL Edwin R.A. Seligman, ed. New York: Macmillan, pp. 84–89.Google Scholar
  29. Hanusch, H. ed. 1988. Evolutionary Economics: Applications of Schumpeter’s Ideas, with introductory essay. Cambridge: Cambridge University Press, pp. 1–7.Google Scholar
  30. Hayek, F.A. 1973. Law, Legislation and Liberty: Vol. 1, Rules and Order. Chicago: University of Chicago Press.Google Scholar
  31. Hayek, F.A. 1978. New Studies in Philosophy, Politics, Economics and the History of Ideas. Chicago: University of Chicago Press.Google Scholar
  32. Hayek, F.A. 1984 (1983). “The Origins and Effects of Our Morals: A Problem for Science.” In The Essence of Hayek, C. Nishiyama and K.R. Leube, eds. Stanford: Hoover Institution Press, pp. 318–330.Google Scholar
  33. Hirschleifer, J. 1977. “Economics From a Biological Viewpoint.” The Journal of Law & Economics 20:1–52.CrossRefGoogle Scholar
  34. Hirschleifer, J. 1982. “Evolutionary Models in Economics and Law.” Research in Law and Economics, Vol. 4. R.O. Zerbe, Jr., ed. Greenwich, CT: JAI Press, pp. 1–60.Google Scholar
  35. Hodgson, G.M. 1988. Economics and Institutions: A Manifesto for a Modern Institutional Economics. Philadelphia: University of Pennsylvania Press.Google Scholar
  36. Hodgson, G.M. 1991. “Economic Evolution: Intervention Contra Pangloss.” Journal of Economic Issues 25:519–533.Google Scholar
  37. Hunt, E.K. 1991. History of Economic Thought: A Critical Perspective, 2nd ed. New York: HarperCollins.Google Scholar
  38. Iwai, K. 1984. “Schumpeterian Dynamics: An Evolutionary Model of Innovation and Imitation.” Journal of Economic Behavior and Organization 5:321–351.CrossRefGoogle Scholar
  39. Jensen, H. 1987. “The [Institutionalist] Theory of Human Nature.” Journal of Economic Issues 21:1039–1073.Google Scholar
  40. Jones, L.B. 1986. “The Institutionalists and On the Origin of Species: A Case of Mistaken Identity.” Southern Economic Journal 52:1043–1055.CrossRefGoogle Scholar
  41. Klein, B.H. 1988. “Luck, Necessity, and Dynamic Flexibility.” In Evolutionary Economics: Applications of Schumpetefs Ideas. Horst Hanusch, ed. Cambridge, UK: Cambridge University Press, pp. 95–127.Google Scholar
  42. Langlois, R.N. 1986a. “The New Institutional Economics: An Introductory Essay.” In Economics as a Process: Essays in the New Institutional Economics. R.N. Langlois, ed. New York: Cambridge University Press, pp. 1–25.Google Scholar
  43. Langlois, R.N. 1986b. “Rationality, Institutions, and Explanation.” In Economics as a Process: Essays in the New Institutional Economics. R.N. Langlois, ed. New York: Cambridge University Press, pp. 225–255.Google Scholar
  44. Levins, R., and Lewontin, R. 1985. The Dialectical Biologist. Cambridge: Harvard University Press.Google Scholar
  45. Marshall, A. 1969 (1920). Principles of Economics, 8th ed. London: Macmillan.Google Scholar
  46. McCloskey, D.N. 1985. The Rhetoric of Economics. Madison, WI: University of Wisconsin Press.Google Scholar
  47. Menger, C. 1963 (1883). Problems of Economics and Sociology. Trans. F.J. Nock. Urbana, IL: University of Illinois Press.Google Scholar
  48. Mirowski, P. 1983. “An Evolutionary Theory of Economic Change: A Review Article.” Journal of Economic Issues 17:757–768.Google Scholar
  49. Mirowski, P. 1989. More Heat Than Light: Economics as Social Physics, Physics as Nature’s Economics. New York: Cambridge University Press.Google Scholar
  50. Mirowski, P. 1990. “Learning the Meaning of a Dollar: Conservation Principles and the Social Theory of Value in Economic Theory.” Social Research 57:689–717.Google Scholar
  51. Nelson, R.R., and Winter, S.G. 1982. An Evolutionary Theory of Economic Change. Cambridge: Harvard University Press, 1982.Google Scholar
  52. Niman, N.B. 1991. “Biological Analogies in Marshalld’s Work.” Journal of the History of Economic Thought 13:19–36.Google Scholar
  53. North, D.C. 1990. Institutions, Institutional Change and Economic Performance. New York: Cambridge University Press.Google Scholar
  54. Parsons, K.H. 1950 (1942). “John R. Commons’ Point of View.” In The Economics of Collective Action. J.R. Commons. New York: Macmillan, pp. 341–375.Google Scholar
  55. Parsons, T. 1968 (1937). The Structure of Social Action, Vol. 1. New York: The Free Press.Google Scholar
  56. Penrose, E.T. 1952. “Biological Analogies in the Theory of the Firm.” American Economic Review 42:804–819.Google Scholar
  57. Polanyi, K. 1944. The Great Transformation: The Political and Economic Origins of Our Times. New York: Rinehart.Google Scholar
  58. Polanyi, K. 1968 (1947). “Our Obsolete Market Mentality.” In Primitive, Archaicv and Modern Economies: Essays of Karl Polanyi. G. Dalton, ed. Boston: Beacon Press, pp. 59–77.Google Scholar
  59. Posner, R.A. 1981. The Economics of Justice. Cambridge: Harvard University Press.Google Scholar
  60. Posner, R.A. 1986. Economic Analysis of Law, 3rd ed. Cambridge: Harvard University Press.Google Scholar
  61. Priest, G.L. 1977. “The Common Law Process and the Selection of Efficient Rules.” Journal of Legal Studies 6:65–83.CrossRefGoogle Scholar
  62. Ramstad, Y. 1986. “A Pragmatist’s Quest for Holistic Knowledge: The Scientific Methodology of John R. Commons.” Journal of Economic Issues 20:1067–1105.Google Scholar
  63. Ramstad, Y. 1987a. “Free Trade Versus Fair Trade: Import Barriers as a Problemof Reasonable Value.” Journal of Economic Issues 21:5–32.Google Scholar
  64. Ramstad, Y. 1987b. “Institutional Existentialism: More on Why John R. CommonsHas So Few Followers.” Journal of Economic Issues 21:661–671.Google Scholar
  65. Ramstad, Y. 1990. “The Institutionalism of John R. Commons: Theoretical Foundations of a Volitional Economics.” Research in the History of Economic Thought and Methodology, Vol. 8. W.J. Samuels, ed. Greenwich, CT: JAI Press, pp. 53–104.Google Scholar
  66. Ramstad, Y. 1992a. “A Wolf in Sheep’s Clothing: John R. Commons and the Question of Social Order.” Paper presented to the Association for Evolutionary Economics, New Orleans, January, 1992.Google Scholar
  67. Ramstad, Y. 1992b. “Towards an Economics of the Just Price: John R. Commonsand Reasonable Value.” Paper presented to the Kress Society, Boston, Massachusetts, February, 1992.Google Scholar
  68. Ramstad, Y. 1993. “Institutional Economics and the Dual Labor Market Theory.” In Institutional Economics, Marc Tool, ed. Boston: Kluwer-Nijhoff Publishing, pp. 173–233.CrossRefGoogle Scholar
  69. Rayack, E. 1987. Not So Free to Choose: The Political Economy of Milton Friedman & Ronald Reagan. New York: Praeger.Google Scholar
  70. Rosenberg, A. 1985. The Structure of Biological Science. New York: Cambridge University Press.Google Scholar
  71. Rosenberg, A. 1991. “Does Evolutionary Theory Give Comfort or Inspiration to Economics?” Paper presented to the Conference on Natural Images in Economics, University of Notre Dame, October, 1991.Google Scholar
  72. Rubin, P.H. 1977. “Why Is the Common Law Efficient?” Journal of Legal Studies 6:51–63.CrossRefGoogle Scholar
  73. Samuels, W.J. 1966. The Classical Theory of Economic Policy. New York: World Publishing.Google Scholar
  74. Schabas, M. 1991. “The Greyhound and the Mastiff: Darwinian Themes in Milland Marshall.” Paper presented to the Conference on Natural Images in Economics, University of Notre Dame, October, 1991.Google Scholar
  75. Schearmus, J. 1986. “The Austrian Connection: Hayek’s Liberalism and the Thought of Carl Menger.” In Austrian Economics: Historical and Philosophical Back-ground. W. Grassl and B. Smith, eds. New York: New York University Press, pp. 210–224.Google Scholar
  76. Schotter, A. 1981. The Economic Theory of Social Institutions. New York: Cambridge University Press.Google Scholar
  77. Schotter, A. 1986. “The Evolution of Rules.” In Economics as a Process: Essays in the New Institutional Economics. R.N. Langlois, ed. New York: Cambridge University Press, pp. 117–133.Google Scholar
  78. Schumpeter, J.A. 1954. History of Economic Analysis, edited from manuscript by Elizabeth Boody Schumpeter. New York: Oxford University Press.Google Scholar
  79. Schumpeter, J.A. 1961 (1934). The Theory of Economic Development. New York: Oxford University Press.Google Scholar
  80. Tilman, R. 1992. Thorstein Veblen and His Critics: 1891–1963. Princeton, NJ: Princeton University Press.Google Scholar
  81. Tool, M.R. 1986. Essays in Social Value Theory: A Neoinstitutionalist Contribution. Armonk, NY: M.E. Sharpe.Google Scholar
  82. Veblen, T. 1899. The Theory of the Leisure Class: An Economic Study of the Evolution of Institutions. New York: B.W. Huebsch.Google Scholar
  83. Veblen, T. 1914. The Instinct of Workmanship and the State or the Industrial Arts’. New York: B.W. Huebsch.Google Scholar
  84. Veblen, T. 1919 (1898). “Why Is Economics Not An Evolutionary Science?” In The Place of Science in Modern Civilization and Other Essays. New York: B.W. Huebsch, pp. 56–81.Google Scholar
  85. Walker, P.M.B., ed. 1989. Chambers Biology Dictionary. Cambridge, UK: W & R Chambers Ltd and Cambridge University Press.Google Scholar
  86. Weisskopf, W.A. 1973. “The Image of Man in Economics.” Social Research 40:547–563.Google Scholar
  87. Wiles, P. 1983. “Ideology, Methodology, and Neoclassical Economics.” In Why Economics is not yet a Science. A.S. Eichner, ed. Armonk, NY: M.E. Sharpe, pp. 61–89.Google Scholar
  88. Williamson, O.E. 1985. The Economic Institutions of Capitalism: Firms, Markets, Relational Contracting. New York: The Free Press.Google Scholar
  89. Wills, C. 1989. The Wisdom of the Genes: New Pathways in Evolution. New York: Basic Books.Google Scholar
  90. Winter, S.G. 1964. “Economic ‘Natural Selection’ and the Theory of the Firm.” Yale Economic Essays 4:225–272.Google Scholar
  91. Winter, S.G. 1971. “Satisficing, Selection and the Innovating Remnant.” Quarterly Journal of Economics 85:237–261.CrossRefGoogle Scholar

Copyright information

© Kluwer Academic Publishers 1994

Authors and Affiliations

  • Yngve Ramstad
    • 1
  1. 1.College of Arts and Sciences Economics DepartmentUniversity of Rhode IslandKingstonUSA

Personalised recommendations