Institutions and economic behaviour under uncertainty
Keywords:
institutions, economic behaviour, uncertainty, knowledge, levels of consciousnessAbstract
This paper intents do link some contributions to our understanding of institutions with a
discussion of economic behaviour under uncertainty, elaborating the characterization of
social reality as subject to unpredictable structural changes. Adopting a broad definition
of institutions, including conventions, it discusses three basic ways in which institutions
influence economic behaviour: their restrictive function, their cognitive function and their
influence on ends. The paper then rejects a reductionist approach to the relation between
institutions and individuals. In order to better understand the influence of institutions on
behaviour, and particularly on knowledge, the paper also distinguishes between different
levels of consciousness and, as a result, different types of knowledge. Finally, the paper
establishes a connection between the preceding discussion and the analysis of the
determinants of the state of expectation, considering Hodgson's proposal for an
institutionalist approach to expectations.
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