1. GETTING HISTORY INTO THE EQUATION Thoughts on Social Capital and on Social Science

2. General Background Systemic failures – Agency – third world development – Deregulation – transition in Eastern Europe – Oversight – global financial crisis Focus on institutions – New institutionalism, coherent theory – Not a “school” as such – No definition of “institutions”

3. History Matters Neoclassical economics – Forward looking instrumental rationality – History the carrier of institutions – Institutions matter – and history does not? Role of economic man – Veblen and chess computers – Anathema to sociology – Core conflict

4. Dealing with Specificity Seeming contradiction – All countries and peoples are the same – All countries and peoples are unique Which story to tell? – Economic man, background noise – When is uniqueness relevant? – Must theory be adjusted? Russia a “normal” country – Clouds the issue

5. Correlations over Time Inglehart et al. – Quality of economic performance – Orthodox, Catholic and Protestant traditions LaPorta et al. – Quality of government – Common, civil, socialist law Core problem – Correlations looking for explanations – Not all relations are causal relations

6. Demonstrating Causality Pathways of institutional reproduction – Rational choice vs. culture EU Catholics and Protestants – Pope was corrupt 500 years ago? – Hierarchical religion, corrupt politics Meiji restoration in Japan – Tokugawa, enemy within, xenophobia – Meiji, enemy without, close ranks

7. Turning to Economics Deductive modeling – Queen of social science (Comte) – Sociology, fiction and nonsense The transaction is a cultural thing – Habits, customs, beliefs, expectations – Legal, moral and social norms – Trust, values, guile Price of success – An ahistoric science – Hirschman, hands tied, not decode

8. Not Always the Case Kuhn, scientific revolutions – Winning paradigm, rewrite history – Neoclassical economics German historicism Inductive approach Political economy an historical science American institutionalism Influenced by historicism Orthodoxy in 1930s New institutional economics Broadly dismissive Nothing to be learned

9. The Scottish Enlightenment Core of the liberal tradition – Invisible hand, inherited – Kant, Mandeville Role of norms – Smith, Hume, Ferguson – Ethics, Arrow, Buchanan, North Role of intervention – Visible hand – Mandeville, Robbins …

10. The Free Market Social science neglects the market as such – Economics takes it for given – Sociology abandoned it to economics New economic sociology – Granovetter, embeddedness – Polanyi contradicted himself – Definitions plentiful and vague New institutionalism – Coherent approach?

11. Problems with Deductive Modeling Powerful track record – Nobel Prize in economics – “Economics imperialism” Predictive power – Restrictive assumptions Great Experiments – Tocqueville, systemic change, dislocations – Rules suspended (Przeworski) – “Natural experiments” and “great laboratory”

12. Methodology Marginal revolution – Methodological individualism – Trivially true (Elster) – Capstone of economics (Arrow) Methodological holism – Rejection of economic man – Embeddedness a replacement? – Richness of detail vs. power of prediction

13. Back to History Arguments abound that history matters – Historical economics (Kindleberger, Snooks) – Historical institutionalism (Pierson, Thelen) – Historical sociology (Mahoney) Challenges to methodological individualism – The whole greater than sum of the parts – Collective memories and norms – Public to private culture and norms

14. Social Capital Shorthand for the missing link – Instrumental rationality – Embedded norms Policy implications – Limits to agency – Handle evolution Overall – Need a theory of norms, human action