Technology and institutions are neither
Hamilton puts another enigmatic title on another significant article. He startles his readers into pondering a non-traditional position. David Hamilton’s prose reminds me of Mark Twain. Few economists share Hamilton’s masterly use of language. Veblen did, and often used it in the same way. All three – Twain, Hamilton, and Veblen – have used language in this peculiar way to teach their readers unconventional thoughts. It is the unconventional that is so hard to learn. So first, these great teachers startle us into a condition conducive to unconventional thought. In this article, Hamilton argues that “technology” and “institution” mean something very different in institutionalism than they do in conventional usage: In institutionalism, technology refers to the process of manipulating tools to achieve ends-in-view while institution refers to the process of propitiating spiritual forces to achieve ends-in-view. On the other hand, in conventional usage, institution refers to an aspect of social organization while technology refers to physical instruments (shovels, hammers, typewriters, computers). Hamilton’s unconventional meanings of institution and technology are used to great advantage by a significant number of institutionalists, particularly by most followers of Clarence E. Ayres and his Texas School. Nevertheless, it is my editorial duty to point out that not all institutionalists use “institution” and “ceremonial” in exactly the same way. In particular, radical institutionalists do not use these terms to mean the propitiation of spiritual forces, but instead to mean the legitimization of the unequal distribution of income, power, and status in contemporary society. The radicals claim, rightly or wrongly, to be going back to the more fundamental institutionalism of Veblen. The difference does not represent a break with other institutionalists. Rather, the significance of the difference lies in the fact that in their critiques of institutions, the radicals emphasize the legitimation of social stratification while the Ayresians emphasize the propitiation of spiritual forces.