Social Reform and Economic Policy

Abstract

This chapter examines the principles that radical institutionalists consider to be the foundation for effective thinking on economic policy. Most prominent in this regard is instrumental value theory and the contradictory relation of invidiousness to instrumental effectiveness. Another prominent theme is the generally favorable response of radical institutionalists to the twentieth-century tendency toward increasing collective and state action to control the economic process. An interwoven theme is the necessity of fully understanding the implications of this collective movement so that the control in question can be made more democratic and more instrumentally effective.

The economic system … is … a curious stream of tendencies.

W. Hamilton, 1918.

Social and historical inquiry is in fact a part of the social process itself, not something outside of it. The consequences of not perceiving this fact was that the conclusions of the social sciences were not made … integral members of a program of social action.

J. Dewey, 1935.

There are not merely analogies to be drawn between democracy and science … The instrumentalist aim. is … a merging of the social reformer with the social scientist.

R. Tilman, 1987.

Reprinted from the Journal of Economic Issues (1984) by special permission of the copyright holder, the Association for Evolutionary Economics.