Arbeitspapier

The Economics of Bounded Rationality, Entrepreneurship and Institutional Evolution

Bounded rationality provides a fundamental economic explanation for non-rational modes of behavior. These non-rational modes underlie both the erratic perturbations of entrepreneurship and the systematic waves of diffusion they initiate which in turn guarantee that the economy operates out of equilibrium. Continuing adjustments out of equilibrium are made possible by financial intermediation. They imply asymmetric changes in individual welfare. The markets for entrepreneurship, ownership and control that liberate creativity and boundedly rational decision-making, therefore, also lead inevitably to conflict among various social groups. Democratic mechanisms for correlating public and private interest that enlist the voluntary participation of agents who are sometimes made worse off in the continuing process of social transformation and which restore access to markets for those who lose is therefore an essential part of a modern economic system. The dialectical interaction among market al1ocations, non-market buffering and stabilizing institutions and democratic process is thus fundamental. Reforms that are based on this interaction achieve voluntary self-transformations. Those that do not, ultimately fall victim to involuntary forces.

Sprache
Englisch

Erschienen in
Series: IUI Working Paper ; No. 210

Klassifikation
Wirtschaft
Criteria for Decision-Making under Risk and Uncertainty
Firm Organization and Market Structure
Entrepreneurship
Thema
Entrepreneurship
bounded rationality
institutional evolution

Ereignis
Geistige Schöpfung
(wer)
Day, Richard H.
Ereignis
Veröffentlichung
(wer)
The Research Institute of Industrial Economics (IUI)
(wo)
Stockholm
(wann)
1989

Handle
Letzte Aktualisierung
20.09.2024, 08:23 MESZ

Datenpartner

Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.

Objekttyp

  • Arbeitspapier

Beteiligte

  • Day, Richard H.
  • The Research Institute of Industrial Economics (IUI)

Entstanden

  • 1989

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