New institutional economics (NIE) is an economic perspective that attempts to extend economics by focusing on the social and legal norms and rules (which are institutions) that underlie economic activity and with analysis beyond earlier institutional economics and neoclassical...
- Repository URL:
- https://works.bepress.com/michael_radzicki/1; http://philsci-archive.pitt.edu/id/eprint/10214
- system dynamics; heterodox economics; institutional economics; feedback; simulation
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In a 2006 paper, Professor Gregory Hayden argued that system dynamics is an inadequate tool for explaining the institutional systems principles of hierarchy, feedback and openness. The purpose of this paper is to show that many of Professor Hayden's claims are either misguided or incorrect. The paper also reinforces the argument that system dynamics modeling can add significant value to traditional institutional economic analysis.