2021 (18), №2

Statistical Method in the Neoinstitutional Theory

For citation: 

Slavin, V. A. (2021). Statistical Method in the Neoinstitutional Theory. Zhurnal Economicheskoj Teorii [Russian Journal of Economic Theory], 18(2), 212-225. https://doi.org/10.31063/2073-6517/2021.18-2.4


The article proposes the probabilistic-dynamic method of neoclassical microeconomics for the case of an incomplete, statistical description of the states of microeconomical systems with a large number of degrees of freedom (a similar technique is used in theoretical physics when studying the thermodynamic properties of multiparticle systems). The statistical description is based on the concept of probability density ri( →s, t) that at time t a small subsystem i of the microsystem is in a state characterized by vector →s of the space of economic decisions. A differential equation is introduced that defines (by a given Hamiltonian Pi( →s, t)) the function ri( →s, t), and its most important properties are formulated: the normalization condition and the principle of statistical independence. The average value of the Hamilton function Pi(t) is determined, which is a measure of the rationality of decisions made in the conditions of institutional interaction and is referred to as statistical (institutional) property. The article also introduces the concepts of entropy Si and the value of monetary capital Ui, which characterize the process of decision-making and implementation in institutional interaction. The equilibrium state of subsystem i for which the probability density is a function of the Hamiltonian Pi and the number of degrees of freedom (connections) Ni is considered in detail. The decompositions of the differential of the statistical property in terms of its entropy and monetary components are obtained, which describe the mechanism of institutional interaction as the exchange of property rights between individuals at each link. It is shown that provided there is a clear specification of rights, a balanced exchange takes place with the preservation of the values of property and entropy in the relationship, which acts as a criterion for a completely rational behavior of individuals (Coase’s theorem). In the absence of a clear specification of rights or the appearance of non-productive relationships in the microsystem (external effects), full ownership dissipates, due to additional monetary costs called transaction costs. The paper presents the results of the calculation of institutional variables and transaction costs of microsystems such as collective catering enterprises and household services.

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Vyacheslav A. Slavin — PhD in Physical and Mathematical Sciences, Associate professor, Department of Higher Mathematics and Theoretical Mechanics, Chuvash State University (Cheboksary, Russian Federation; e-mail: slavin9297@mail.ru).

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