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   Course Title    Economic and Political Change: New Institutionalist Approach
Lecturer    Klimentina Poposka
Institution    University of St. Cyril and Methodius
Country    Macedonia

Course objective:

This course explores institutional theories of economic and political change. "New Institutionalism" covers a wide range of theories, including rational choice, sociological, and historical approaches. These distinct theories share a common claim that institutions influence behavior strategies adopted by individuals, firms, groups, and governments, and thereby affect economic and political outcomes. The seminar will address a number of questions arising from this claim. How should institutions be defined? Why do people create institutions? Once created, how do institutions matter, that is, how do institutions affect actors’ incentives and preferences, and how do they affect political and economic outcomes? Several sessions cover various aspects of institutional change (the role of legacies, institution building and consolidation, the role of trust in institutional settings). Finally, what are the strengths and weaknesses of new institutionalism in general, and of each specific variant in particular? At the end of the course students are expected to understand the nature of the institutional change (and stability) in the post-communist world.

Course Requirements:

Students will follow the set of common readings from the syllabus and actively participate in the course. This will include taking part in the discussions, giving oral presentations and writing reaction papers followed by the term essay (ca. 3000 words).


1. Changing Institutions and Organizations

The introductory session provides participants with the overall idea and structure of the course and presents the main sociological approaches to the study of institutions, stressing the similarities and differences between the ‘old’ and ‘new’ institutionalism.

North, D. (1990) Institutions, Institutional Change and Economic Performance. Cambridge: Cambridge University Press. Selected.

Hall, P., Taylor, R. (1996) Political Science and The Three New Institutionalisms in Political Studies (44): 936-57.

Immergut, E (1998) The Theoretical Core of the New Institutionalism in Politics & Society 26(1): 5-34.


2. Historical Institutionalism

This session reviews peculiarities of one out of three varieties of New Institutionalism – Historical Institutionalism.

Thelen, K. (1999) Historical Institutionalism in Comparative Politics in Annual Review of Political Science 2:369-404.

Pierson, P. (2000) Increasing Returns, Path Dependence, and the Study of Politics in American Political Science Review 94(2): 251-267.


3. Rational Choice Institutionalism

This session reviews distinct features Rational Choice Institutionalism.

North, D., Thomas, P. (1973) The Rise of the Western World. New York: Cambridge University Press. Selected.

Shepsle, K. (1989) Studying Institutions: Some Lessons from the Rational Choice Approach in Journal of Theoretical Politics 1(2): 131-147.

Hammond, T. (1996) Formal Theory and the Institutions of Governance in Governance 9(2): 107-185.2


4. New Institutional Economics

The session focuses on central concepts and analytical tools of New Institutional Economics.

North, D. (1990) A Transaction Cost Theory of Politics in Journal of Theoretical Politics 2 (4): 355-367.

Weingast, B. (1989) The Political Institutions of Representative Government: Legislatures in Journal of Institutional and Theoretical Economics 145: 693-703.

Moe, T. (1984) The New Economics of Organization in American Journal of Political Science 28 (Nov): 739-77.

Shepsle, K. (1991) Discretion, Institutions, and the Problem of Government Commitment in Bourdieu P. and Coleman, J. (eds.) Social Theory for a Changing Society, Boulder: Westview Press. Pp. 245-65.


6. New Institutionalism in Sociology

The session is devoted to distinct features of sociological variants of New Institutionalism.

DiMaggio, P., Powell, W. (1991) (eds.) The New Institutionalism in Organizational Analysis. Chicago: The University of Chicago Press. Introduction.

Nee, V. (1998) Source of New Institutionalism in Briton, M., Nee, V. (eds.) The New Institutionalism in Sociology. New York: Russel Sage Foundation.


7. Creating Institutions: the Institutional Legacy of Communism and the Dynamics of Change

The session concentrates on the question of creation of institutions and the peculiarities of this process in the post-communist world. It examines the importance of legacies (cultural, institutional) and path-dependence phenomena for the understanding of institutional change.

North, D. (1981) Structure and Change in Economic History. New York: W.W. Norton & Company. Pp. 1-59.

Kent, W., Rockman, B. (eds.) (1993) Do Institutions Matter? Government Capabilities in the United States and Abroad. Washington, DC: Brookings Institution.

Stark, D., Bruszt, L. (1998) Path Dependency and Privatization Strategies in: Stark, D., Bruszt, L. (eds.) Post Socialist Pathways. Cambridge University Press.

Balcerowicz, L. (1995) Socialism, Capitalism, Transformation. Budapest: CEU Press. Selected.


8. Institutional Change: Politics

Main characteristics and peculiarities of political institutionalization in post-Communist countries are discussed. The session concentrates on the importance of the concept of civic traditions (extended trust, engagement, reciprocity) for better understanding the nature of the post-Communist institutional change.

Offe, C. (1996) Capitalism by Democratic Design? Democratic Theory Facing the Triple Transition in East Central Europe in Offe, C. (ed.) Varieties of Transition. Polity Press.

Martin, L. (2000) Democratic Commitments: Legislatures and International Cooperation. Princeton: Princeton University Press. Selected.

Putnam, R. (1993) Making Democracy Work: Civic Traditions in Modern Italy. Princeton: Princeton University Press. Selected.

Przeworski, A. (1993) Democracy and the Market: Political and Economic Reforms in Eastern Europe and Latin America. New York: Cambridge University Press. Selected.


9. Institutional Change: Economics (Domestic Perspective)

The session focuses on the problem of political institutions for public economic management.

Van Doren, P. (1989) Should Congress Listen to Economists? in Journal of Politics 51 (2): 319-336.

Miller, G., Hammond, T. (1994) Why Politics is More Fundamental than Economics in Journal of Theoretical Politics 6(1): 5-26.


10. Institutional Change: Economics (International Perspective)

The session concentrates on peculiarities of institutionalization of new economic order in post-Communist countries in a globalizing world.

Pierson, P. (1996) The Path to European Integration: A Historical Institutional Analysis in Comparative Political Studies 29(2): 123-63.

Bernard, W. (1998) A Political Explanation of Variations in Central Bank Independence in American Political Science Review 92 (June): 311-27.

Broz, L. (1999) Origins of the Federal Reserve System: International Incentives and the Domestic Free-Rider Problem in International Organization 53 (Winter): 39-70


11. Institutional Consolidation

The session discusses a phenomenon of the peculiar simultaneity of the processes of transition and consolidation that post-Communist countries have been experiencing in their institutional change.

Linz, J., Stepan, A. (1996) Problems of Democratic Transition and Consolidation. Baltimore: The Johns Hopkins University Press. Selected.

Offe, C., Elster, J., and Preuss, U. (1998) Institutional Design in Post-Communist Societies: Rebuilding the Ship at Sea. New York: Cambridge University Press. Selected.


12. Reflections on the New Institutionalism(s)

The session is devoted to reflection to promises and shortcomings of the New Institutional approach in analysis of institutional change in post-Communist countries.

Moe, T. (1990) Political Institutions: The Neglected Side of the Story in Journal of Law, Economics and Organization 6: 213-53.

Williamson, O. (1990) Comment in Journal of Law, Economics and Organization 6: 263-66.

Pierson, P. (2000) The Limits of Design: Explaining Institutional Origins and Change in Governance 13(4): 475- 499.

Miller, G. (2000) Rational Choice and Dysfunctional Institutionalism in Governance 13(4): 535-547.

Pollack, M. (1996) The New Institutionalism and EC Governance: The Promise and Limits of Institutional Analysis in Governance 9(4): 429-458.


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