ABSTRACT
Effective economic policy is inseparable from the fundamental function of the economic process and its place in human society that is, provisioning the human life process. Because the institutionalist conception is very different in this regard from that of conventional economics, it is necessary to dwell on the point in some detail. The economy is a material, technological, or substantive process of provisioning the social and individual requirements for society to continue to exist and evolve as a going concern. Another important base of effective thinking on economic policy is the principle of household sovereignty. The unfolding life process is shaped, defined, and interpreted by a context of patterned meanings, that is, culture. The purpose of the economy as instrumentally conceived is to provision and encourage, or at least to not discourage, the development of individual personalities. Institutionalists also insist that an evolutionary and holistic focus is necessary to think effectively about economic policy.
