Sufficient Reason: Volitional Pragmatism and the Meaning of Economic Institutions

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Sufficient Reason: Volitional Pragmatism and the Meaning of Economic Institutions. By Daniel W. Bromley. Princeton: Princeton University Press, 2006. 256p. $35.00.

The purposes of this book are twofold: first, to call into question what the author takes to be the dominant economic approach to explaining institutional change—and thus public policy outcomes—and second, to offer an alternative explanatory approach rooted in what the author calls “volitional pragmatism.” According to the dominant view, institutional change can (or should) be explained “endogenously” in terms of the utility-maximizing choices of individuals: “In the received story, institutions change—machinelike—when it is efficient for them to change. And if they do not change, then it is efficient that they not change” (p. 214). When, contrary to theoretical expectations, institutions change or fail to change in a way that economists take to be inefficient, then this is said to be the result of collective (political) interference with and distortion of otherwise efficient individual choices. Such interference is explained by appealing to the irrationality or ignorance of political actors (Daniel Bromley calls this the “dimwit conjecture,” p. 124) or, perhaps more commonly, by the fact that the political process has been captured by “special interests.”