Uncertainty, Rationality and the Study of Social Institutions

Abstract

The insight that both ontological and epistemological perspectives are intertwined is certainly correct, but at the same time insufficient to differentiate mainstream from heterodox approaches to economic institutions. As this paper argues, it is important whether one starts from ontological or epistemological considerations first. The paper suggests that the difference can be described in terms of function versus rules and demonstrates that an intersubjective ontology for institutions requires also an intersubjective epistemology. Otherwise, ontological precepts contradict the epistemological ones with important repercussions for understanding knowledge, rationality and institutions.

Keywords:

• uncertainty
• risk
• practical knowledge
• linguistic turn
• institutionalism

Notes

1 The use of the term might appear problematic. In particular in relation to distinctions like ‘ontic’ and ‘deontic’. But to avoid longer discussions at this point, I follow the conventional use. I thank an anonymous referee for pointing this out to me.