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Explaining economic change: The Interplay Between Cognition and Institutions

Publication ,  Journal Article
Knight, J; North, D
Published in: Legal Theory
January 1, 1997

Economic theory is built on assumptions about human behavior—assumptions embodied in rational-choice theory. Underlying these assumptions are implicit notions about how we think and learn. These implicit notions are fundamentally important to social explanation. The very plausibility of the explanations that we develop out of rational-choice theory rests crucially on the accuracy of these notions about cognition and rationality. But there is a basic problem: There is often very little relationship between the assumptions that rational-choice theorists make and the way that humans actually act and learn in everyday life. This has significant implications for economic theory and practice. It leads to bad theories and inadequate explanations; it produces bad predictions and, thus, supports ineffective social policies. © 1997, Cambridge University Press. All rights reserved.

Duke Scholars

Published In

Legal Theory

DOI

EISSN

1469-8048

ISSN

1352-3252

Publication Date

January 1, 1997

Volume

3

Issue

3

Start / End Page

211 / 226

Related Subject Headings

  • 5003 Philosophy
  • 4804 Law in context
  • 2203 Philosophy
  • 1801 Law
 

Citation

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Chicago
ICMJE
MLA
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Knight, J., & North, D. (1997). Explaining economic change: The Interplay Between Cognition and Institutions. Legal Theory, 3(3), 211–226. https://doi.org/10.1017/S1352325200000768
Knight, J., and D. North. “Explaining economic change: The Interplay Between Cognition and Institutions.” Legal Theory 3, no. 3 (January 1, 1997): 211–26. https://doi.org/10.1017/S1352325200000768.
Knight J, North D. Explaining economic change: The Interplay Between Cognition and Institutions. Legal Theory. 1997 Jan 1;3(3):211–26.
Knight, J., and D. North. “Explaining economic change: The Interplay Between Cognition and Institutions.” Legal Theory, vol. 3, no. 3, Jan. 1997, pp. 211–26. Scopus, doi:10.1017/S1352325200000768.
Knight J, North D. Explaining economic change: The Interplay Between Cognition and Institutions. Legal Theory. 1997 Jan 1;3(3):211–226.
Journal cover image

Published In

Legal Theory

DOI

EISSN

1469-8048

ISSN

1352-3252

Publication Date

January 1, 1997

Volume

3

Issue

3

Start / End Page

211 / 226

Related Subject Headings

  • 5003 Philosophy
  • 4804 Law in context
  • 2203 Philosophy
  • 1801 Law