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Subject Area: Political Theory

Institutionalism vs. Radical Individualism - Leonard P. Liggio, Literature of Liberty, Spring 1982, vol. 5, No. 1 [1982]

Edition used:

Literature of Liberty: A Review of Contemporary Liberal Thought was published first by the Cato Institute (1978-1979) and later by the Institute for Humane Studies (1980-1982) under the editorial direction of Leonard P. Liggio.

Part of: Literature of Liberty: A Review of Contemporary Liberal Thought, 20 vols. 19781-982

About Liberty Fund:

Liberty Fund, Inc. is a private, educational foundation established to encourage the study of the ideal of a society of free and responsible individuals.


Institutionalism vs. Radical Individualism

Paul D. Bush

  • California State University at Fresno

“'Radical Individualism' vs. Institutionalism: Philosophical Dualisms as Apologetic Constructs Based on Obsolete Psychological Preconceptions.” American Journal of Economics and Sociology 40 (July 1981): 287–297.

In his book Thorstein Veblen and the Institutionalists, David Seckler adopts a whole range of classical philosophical dualisms which find their expression in such methodological prescriptions as Ludwig von Mises' “insurmountable methodological dualism.” According to Prof. Bush, this philosophical orientation is the least likely to help him come to grips with the question of what Veblen and the institutionalists “really mean.”

According to the school of “radical individualism,” which Seckler supports, we are required to adopt a methodology in the human sciences quite different from that employed in the natural sciences where phenomena under study can be comprehended only in terms of “deterministic” hypotheses. The specific method that must be used in the social sciences, therefore, is one upon which Veblen heaped so much scorn, the method of “sufficient reason.”

For Seckler, this position allows one to take a clear and unambiguous stand in favor of free will and against determinism. In his view, “humanists” opt for free will, whereas behaviorists commit the fallacy of “scientism,” that is, superimposing the methods of the natural sciences in the study of human nature and processes. Seckler is quite correct in stating that Veblen rejected both “historicism” and “behaviorism” in his search for an appropriate methodology to understand the social processes of “cumulative causation.” It is also true, Prof. Bush asserts, that Veblen rejected what Seckler calls humanism.

In one very revealing passage in his book, Prof. Seckler talks about institutional changes taking place without any change in the “fundamental values” of society. Such a remark reveals how far he has moved from both Veblen and contemporary institutionalists in his conception of institutions and the meaning of institutional change. According to both Veblen and Ayres, institutional change means a change in “habits of thought” and, at the core of these habits are the values by which behavior is correlated within the institutional context. Thus, institutional change is a change in the value structure of the community.

For the institutionalist, rational choice does exist. However, the kind of rational choice the institutionalist finds extant in human behavior is publicly knowable. It is not confined to the private, internal world of the rankings of tastes and preferences. Values have social significance only to the extent that they function as standards of judgment which help to correlate behavior. This conception of the human value is quite different from the idea propounded by radical individualism. The institutionalist is able to formulate hypotheses about social behavior which are not cast in terms of postulates on the mapping of individual preference rankings. This is precisely because institutionalists find human values in the public realm of observable human action, leaving the “internal” or private world of individual preference rankings to fields other than science.