ABSTRACT
This chapter considers the neoinstitutionalist perspective, representative examples of the normative deference to the competitive model. It shows that the normative use of the competitive model is similarly inapplicable and that efforts to apply it are counter-productive in significant ways. A most significant and troublesome extension of neoclassical social value theory is revealed in the pervasive tendency to use the competitive model itself as a norm or standard for making economic policy judgments. The normative use of the competitive model appears to be at least as strong among conventional economists at the end of the century as Veblen perceived it to be at the beginning. Other economists besides Veblen, both orthodox and heterodox, have raised serious objections to the normative use of the competitive model. The normative use of the competitive model is pervasive in the orthodox literature and remains high on the political agenda of conservative ideologists.
