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Samenvatting (ENG) - Social and institutional change (SOBA904)
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Summary of the mandatory literature for the course Social and Institutional Change (ENG) for the year 2024/2025.
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Social and Institutional Change 2024 – 2025Daniëlle Boes
Session 3 – The micro-macro problem
Hedström, P. & Richard, S. (1996). Social Mechanisms. Acta Sociologica, 39 (3), 281–308.
This article argues that identifying and analyzing social mechanisms is crucial for the
advancement of sociological theory. The authors, Peter Hedström and Richard Swedberg,
contend that social mechanisms provide a necessary middle ground between simple
descriptions and universal social laws. They advocate for developing detailed, middle-range
theories that explain the social mechanisms driving the relationships between cause and effect.
The authors examine the concept of "social mechanisms" from various angles:
• Historical Use in Sociology: While the idea of social mechanisms is present in the works
of classical sociologists, the term itself was rarely used. Robert Merton, a prominent
sociologist, advocated for "middle-range theorizing" focused on social mechanisms, arguing
they are the essential building blocks of sociological theories.
• Comparison with Other Sciences: The authors explore how the concept of "mechanism"
is used in different scientific disciplines like physics, biology, economics, and psychology.
They note that while the term is rarely used in physics, it is common in biology, where
mechanisms explain biological processes. In economics, the market mechanism is central
to many analyses. Psychology, particularly cognitive psychology, also relies heavily on the
concept of mechanisms.
• Explanatory Power: The authors highlight that social mechanisms go beyond mere
statistical associations by illuminating the processes driving observed relationships.
They argue that searching for social mechanisms helps differentiate genuine causality from
mere correlation. By understanding these mechanisms, sociologists can move beyond
describing phenomena to explaining why they occur.
• Variables vs. Social Mechanisms: The authors critique the prevalent "variable-centered"
approach to theorizing in sociology, which often focuses on statistical associations without
adequately addressing the underlying social mechanisms. They argue that this approach,
exemplified by causal modeling, often results in "black-box" explanations that fail to
uncover the generative processes behind observed relationships. The authors advocate for
focusing on the actions and interactions of individuals as the driving force of social
phenomena.
• Examples of Social Mechanisms: To illustrate their point, the authors analyze three
well-known sociological theories: Merton's self-fulfilling prophecy, Coleman's network
diffusion theory, and Granovetter's threshold theory of collective behavior. They show that
all three theories rely on a common belief-formation mechanism, where individuals' actions
influence the beliefs and subsequent actions of others. This highlights the idea of general
social mechanisms operating across various social phenomena.
• Typology of Social Mechanisms: The authors propose a typology of social mechanisms
based on Coleman's macro-micro-macro model:
o Situational Mechanisms: These explain how macro-level social structures or conditions
influence individual beliefs, desires, and opportunities.
o Individual Action Mechanisms: These describe how specific combinations of individual
beliefs, desires, and opportunities lead to specific actions.
o Transformational Mechanisms: These show how the actions and interactions of
individuals generate collective outcomes at the macro level.
The authors conclude by emphasizing the importance of social mechanisms in constructing middle-
range sociological theories. They argue that a focus on social mechanisms helps to avoid the
pitfalls of both purely empirical and overly abstract theorizing and advances the
development of a more insightful and explanatory sociological theory.
,Social and Institutional Change 2024 – 2025
Daniëlle Boes
Session 4 – Theories of institutional change
Kingston, C., & Caballero, G. (2009). Comparing Theories of institutional change. Journal of Institutional Economics,
5(2), 151-180.
This text provides a detailed comparison of various theoretical approaches to understanding
institutional change, highlighting the complexities and lack of consensus in the field. The authors'
goal is not to identify the 'best' theory, but to analyze the commonalities and differences between
existing theories, which can help empirical researchers engage more effectively with theoretical
frameworks.
The text explores the following questions about institutional change:
• What are the primary drivers of institutional change?
• Is change best viewed as a spontaneous or deliberate process?
• How do formal and informal rules interact and influence change?
• What factors contribute to the pace of change and institutional inertia?
• How do history, bounded rationality, and equilibrium selection shape institutional
evolution?
Defining "Institutions"
Before examining institutional change, the text acknowledges the lack of consensus on the
definition of "institutions". It cites Douglass North's widely accepted definition: institutions as
"humanly devised constraints that shape human interaction", encompassing both formal
rules like laws and informal constraints like norms and conventions.
• Most theories distinguish between formal and informal rules. Formal rules are typically
explicit, written, and enforced by specialized entities like the state, while informal
rules are implicit and enforced endogenously by community members.
• The text emphasizes the importance of distinguishing between different types of
informal constraints, as they might involve distinct mechanisms of change and impact
the broader institutional landscape in unique ways.
Collective-Choice Theories: Deliberate Design
The text first examines theories that view institutional change as a centralized, collective-choice
process. In this framework, rules are established by a collective political entity (like a community
or state), and individuals and organizations engage in political activities to influence rule changes.
• Libecap (1989) focuses on the evolution of property rights, where individuals and groups
engage in bargaining and political action to alter rules for their benefit. The higher-
level political rules governing this "contracting" process shape the direction of
institutional change in lower-level property rights rules.
• Ostrom (2005) introduces a nested hierarchy of rules, distinguishing between
operational, collective-choice, and constitutional rules. Institutional change occurs when a
"minimum coalition" (determined by higher-level rules) agrees on a change based on their
perceived costs and benefits.
• The role of the state varies across theories. Some see political actors as mere reflections
of interest groups, while others grant them more autonomy.
Limitations of Collective-Choice Theories: The text points out that while offering valuable
insights, these theories struggle to explain the frequent disregard for formal rules and their
failure to achieve intended outcomes. This is partly because they struggle to account for
certain types of informal rules, particularly social norms and conventions that evolve
spontaneously and cannot be easily incorporated into collective-choice models.
, Social and Institutional Change 2024 – 2025
Daniëlle Boes
Evolutionary Theories: Spontaneous Emergence
The text then explores evolutionary theories of institutional change, where new forms emerge and
undergo a decentralized selection process. Successful institutions spread, while unsuccessful
ones disappear.
• Transactions Cost Economics (TCE) emphasizes the emergence of efficient institutions
that minimize transaction costs. Competition drives this process, with those adopting
efficient institutions surviving and being imitated. However, TCE often overlooks the
possibility of multiple equilibria and the persistence of inefficient institutions.
• Veblen (1899) centers his theory on the evolution of "habits of thought", which are
adaptable yet durable propensities to think and act. Institutional change involves the co-
evolution of shared habits (institutions) and individual habits, influenced by past,
present, and future circumstances.
• Hayek (1973) proposes a theory based on group selection, where rules evolve because
groups practicing them are more successful. Shared expectations, rather than explicit
rules, are seen as the foundation of social order.
• The text highlights the limitations of group selection as a driver of efficient institutions,
particularly in shorter timeframes.
Equilibrium Selection in Evolutionary Theories: When multiple equilibria exist, the selection of
specific rules becomes crucial. This can be influenced by random chance, analogies to familiar
rules, distributional consequences and bargaining power, and focal points.
Integrating Evolution and Design
Recognizing the limitations of both approaches, the text explores theories that blend deliberate
design and spontaneous evolution. This involves understanding the complex interplay between
formal rules and informal constraints.
• Williamson (2000) suggests a hierarchy of institutions based on their rate of change,
with informal rules ("institutions of embeddedness") changing slowly and influencing
higher-level formal rules. However, he largely treats informal rules as exogenous to his
analysis.
• North (1990) assigns a central role to informal rules in institutional change. He sees
formal rules changing through deliberate political processes, while informal rules co-
evolve as extensions of formal rules. This interaction leads to incremental change that
is influenced by path-dependence and the persistence of informal constraints.
• Other theories highlight the possibility of informal institutions becoming formalized
over time.
The "Equilibrium View": This framework shifts the focus from rules to behavior, seeing
institutions as endogenous equilibrium outcomes that reflect shared beliefs about expected
behavior. Institutional change then becomes about changing expectations rather than simply
changing rules.
Institutional Inertia and the Role of History
The text emphasizes the importance of understanding institutional inertia – the resistance to
change. Various factors contribute to institutional stability, including:
• Free-rider problems hindering collective action to change formal rules.
• The persistence of informal constraints that evolved alongside previous formal rules.
• Strategic linkages and complementarities between institutions across different
domains of the economy.
• Path-dependence, where past institutions influence the configuration of interest groups,
resource allocation, and feasible options for future change.
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