Surveying the Methodological and Analytical Foundations of the New Institutional Economics: A Critical Comparison with Neoclassical and (Old) Institutional Economics

The purpose of this article is to review the methodological and analytical foundations of the New Institutional Economics by implying a critical comparison with the Neoclassical and (old) Institutional Economics. After a discussion of the fundamental definitions and concepts of the New Institutional Economics, I turn to the critical comparison with other schools of thought. It is shown that the New Institutional Economics does not break fundamentally from the neoclassical economics. To the contrary, it can be fairly argued that the New Institutional Economics is a research program which is developed within and around the dominant neoclassical paradigm. On the other hand, it is argued that the Old and New Institutional Economics constitute two distinct approaches to the analysis of institutions, stemming from different paradigmatic viewpoints that produce and nurture contrasting perspectives on how to theoretically tackle institutions.