ABSTRACT
Institutional economics can be defined as the study of institutions in the economy. It is now a major sub-field, with important applications to studies of business, developing economies, transitional economies, property rights and much else. This chapter presents an essay which addresses 'new' and 'original' traditions in institutional economics. It also presents a brief history of institutional economics. It considers some examples of the growing recognition of the importance of institutions in the analysis of economic growth and development. The chapter addresses the nature and role of the individual and his or her motivations. It discusses property rights, the role of law and transaction costs. The concept of property rights was stressed by original institutionalists such as Commons, as well as by new institutional economists and those working on the 'economics of property rights'. Finally, the chapter presents some brief remarks on the development of institutional economics in the future.
