Institutional Economics as an Ideological Movement

Abstract

In the 1920s, when it was in its ascendancy as a movement that seriously challenged the hegemony of neo-classical economics, institutional eco-nomics could boast of having some of the most distinguished economists in America in its ranks. Thorstein Vehlen was the most famous, if not the most respectable, member of the group. His students and disciples held posts at some of the country’s most distinguished universities: men like Wesley C. Mitchell, J. M. Clark, Walton Hamilton, and Morris Copeland. All of these were highly acclaimed economists whose publications appeared frequently in the leading professional journals. Indeed, in 1928, when Paul Homan published his well-known book summarizing the main positions of contemporary economists, he included five major figures to represent the leading viewpoints of the time. Two of them (Veblen and Mitchell) were American institutionalists, and one (J. A. Hobson) was an English cousin of institutionalism. Only J. B. Clark and Alfred Marshall could be counted among the representatives of orthodoxy and by 1928 they had already passed from the scene, (Homan, 1928).