ABSTRACT
The role of ideas or mental models as causal elements in institutional change, rather than as post hoc rationalizations of institutional change, is torturous ground for political economists. Rather than focusing upon ideas, agents’ ‘given’ interests are the political economists ever ready tool of explanation. Thus when analysts seek to understand institutional change, many start with the reasonable assumption that agents have interests and act upon them. Given this, they conclude that if institutions no longer serve agents’ interests, they will seek to change them; hence change is explained. But is this the whole story, especially in moments of crisis? Specifically, does it not matter that large scale institutional changes tend to occur against a backdrop of economic crisis which renders existing institutions unstable? And how does this matter? In a ‘given’ interest scenario it surely does not matter. In such a world, agents, the pursuit of whose interests are frustrated in such moments of institutional failure, should, knowing their interests, seek to change them; hence institutions change. But again, can this be the whole story given that it raises a rather thorny issue that such approaches neglect – how do agents know what institutions to construct if they do not know what futures to expect?
