ABSTRACT
This chapter offers a synthetic and integrative overview of the reemergent paradigm, neoinstitutional political economy. It presents the fundamental underlying philosophical premises and postulates on which the paradigm is erected. The chapter provides analysis of the paradigm model—an evolving, discretionary economy in which the constituent theories of a mixed economy, resource creation, administered pricing, and operational control and a participatory, democratic polity in which the theories of self-goverance, accountability, and efficient rule-making are sketched. It suggests that neoinstitutionalism has increasing relevance as a perspective on problems of the day. The neoinstitutionalists’ mode of inquiry is a combination of rationalism and empiricism, deductive and inductive procedures, and recourse to theoretical and factual materials. Neoinstitutionalists offer a theory of social change that reflects a Darwinian and Veblenian ancestry; it is an evolutionary account. Among paradigms of political economy presently contending for acceptance, neoinstitutionalism is substantially unique in its direct confrontation with, and analysis of, the social value problem in political economy.
