Diversity in the Knowledge Economy and Society

Diversity in the Knowledge Economy and Society

Heterogeneity, Innovation and Entrepreneurship

Science, Innovation, Technology and Entrepreneurship series

Edited by Elias G. Carayannis, Aris Kaloudis and Åge Mariussen

The key message of this book is that heterogeneity should be seen as an intrinsic and indispensable element of knowledge systems. The authors address the concept of heterogeneity in a multi-disciplinary fashion, including perspectives from evolutionary economics and innovation system studies, and relate this approach to existing theories in a broad range of fields.

Chapter 4: Heterogeneity, Rationality and Institutions

Tore Sandven

Subjects: business and management, diversity and management, knowledge management, economics and finance, economics of innovation, innovation and technology, economics of innovation, innovation policy, knowledge management


Tore Sandven INTRODUCTION Approaches to economics that are critical of the dominant neo-classical tradition often hold heterogeneity and diversity to be central characteristics of economic life. Conversely, the dominant tradition is claimed to neglect, misrepresent or deny heterogeneity and diversity. For instance, in his book Les trous noirs de la science économique,1 Jacques Sapir proposes the concept of heterogeneity as a fundamental concept for an alternative economic theory. Diversity, he claims, should not be treated as accidental, as the product of imperfections, bound to be wiped out with time. On the contrary, ‘diversity, from that of the actors to that of the trajectories of concrete economies, is the norm and should be conceptualised as such’.2 This chapter approaches the issue of heterogeneity or diversity by focusing on the question of institutional diversity in the economy. More specifically, different ways of understanding and evaluating this institutional diversity are discussed and related to the ideas one has of human rationality and human action. Or, conversely, an exploration is made of the implications of different conceptions of human rationality for the way institutional diversity may be understood. INSTITUTIONAL DIVERSITY As an issue distinguishing different approaches to an understanding of the economy, that of institutional diversity first and foremost concerns the relationship between the market or the market mechanism and other institutions or mechanisms in driving and coordinating economic action. For instance, in a discussion of the coordination mechanisms of modern capitalist economies, J. Rogers Hollingsworth, Philippe C. Schmitter...

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