Institutional Economics Final Study Guide

Topics: Value, Economics, Land Pages: 13 (3263 words) Published: December 19, 2012
Institutional Economic Theory, Economics 451, Final Examination Review

According to the institutional (functional) theory of resources:
resources are functionally scarce
*resources are a function of knowledge
resources are a function of nature
neutral stuff is converted into resources but remains scarce Which of the following is a prerequisite to capital accumulation according to Institutionalists?
*none of the above
For Institutionalists, mass production
is a crime against good taste
*has increased material well being and is therefore good
sacrifices quality for quantity
destroys excellence because it destroys rarity
According to Institutionalists values and valuing
occur in the ceremonial process only
*are unique among human experiences
can be validated or "instrumentally" chosen
converge as a ceremonial process
According to Institutionalists what people consume is determined primarily by
Income wealth
The combination principle is best understood as which of the following
*the "great man" theory of invention is correct
individuals are not necessarily entitled to income as a result of inventions
all inventions are functions of previous inventions
change is associated with inventions of new tools
According to Veblen the code of pecuniary beauty may be illustrated all of the below except:
*threadbare horses and pet dogs.
close-cropped lawns.Shiny cars
Doing what the "right" people do, while ceremonial behavior:
is behavior that does exist in fact.
*is behavior that is not objective but depends on subjective motives.
is identical in intent with the judgment that determines the choice of a tool by a mechanic.
being a value judgment, is not subject to scientific analysis.

The President of the United States asks the "positive" economist, "We have money for an Academy of Science or an Academy of Witchcraft. The nation seems to be about equally divided on which they want. What would you advise me to do?"

Build the Academy of Science.
Neither, solve the problem of poverty.
*I cannot help you; I am a scientist.
Build the Academy of Witchcraft.
According to Institutionalists the two ways of knowing are:
scientific and intuitive.
*ceremonial and instrumental.
qualitative and quantitative.
authoritative and experimental.
Ayres thinks that the "industrial revolution" began in Western Europe because:
the climate is cooler than Southern Europe and thus the level of activity was stepped up.
the institutions of Western Europe were more rigid and therefore provided greater stability.
*the culture of Western Europe was technologically continuous with the whole Mediterranean area and institutionally discontinuous with it.
more of the great thinkers were living in Western Europe than any other place at the time. The greatest achievements of mankind:
are best explained as due to achievements of a few gifted people.
are to be credited to the efforts of the elite.
*are manifestations of general processes in which many people participate.
none of the above.
According to Munkirs and Knoedler the U.S. economy is typified by:
a planning sector and a government sector
a market sector and a government sector
*centralized privates sector planning
free enterprise
Which of the following would be the most apt to be a source of ceremonial cost
*public relations
market research
Which of the following is not true of resources in institutional theory?
*they are considered naturally scarce.
they are determined by the interaction of technology and institutions
they are dynamic
they require neutral stuff being stripped of resistances
FInstitutionalists argue that the strategy of progress requires the immediate and complete abrogation of the ceremonial aspect of the...
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