New institutionalism

Neo institutionalism (also referred to as neo-institutionalist theory or institutionalism) is an approach to the study of institutions that focuses on the constraining and enabling effects of formal and informal rules on the behavior of individuals and groups. New institutionalism traditionally encompasses three major strands: sociological institutionalism, rational choice institutionalism, and historical institutionalism. New institutionalism originated in work by sociologist John Meyer published in 1977.

The study of institutions and their interactions has been a focus of academic research for many years. In the late 19th and early 20th century, social theorists began to systematize this body of literature. One of the most prominent examples of this was the work of German economist and social theorist Max Weber; Weber focused on the organizational structure (i.e. bureaucracy) within society, and the institutionalization created by means of the iron cage which organizational bureaucracies create. In Britain and the United States, the study of political institutions dominated political science until the 1950s. This approach, sometimes called 'old' institutionalism, focused on analyzing the formal institutions of government and the state in comparative perspective. It was followed by a behavioral revolution which brought new perspectives to analyzing politics, such as positivism, rational choice theory, and behavioralism, and the narrow focus on institutions was discarded as the focus moved to analyzing individuals rather than the institutions which surrounded them. New Institutionalism was a reaction to the behavioral revolution.

Institutionalism experienced a significant revival in 1977 with two influential papers by John W. Meyer and Brian Rowan on one hand and Lynn Zucker on the other. The revised formulation of institutionalism proposed in this paper prompted a significant shift in the way institutional analysis was conducted. Research that followed became known as "new" institutionalism, a concept that is generally referred to as "neo-institutionalism" in academic literature. Another significant reformulation occurred with Paul DiMaggio and Walter W. Powell's paper on isomorphism. The three papers had in common that they explained the practices of organizations not in terms of efficacy and efficiency, but in terms of legitimacy. The functions of an organization did not necessarily reflect rational or optimal ends, but were instead myths, ceremonies and scripts that had a veneer of rationality.

The following decade saw an explosion of literature on the topic across many disciplines, including those outside of the social sciences. Examples of the body of work in the decade which followed can be found in DiMaggio and Powell's 1991 anthology in the field of sociology; in economics, the Nobel Prize-winning work of Douglass North is a noted example.

More-recent work has begun to emphasize multiple competing logics, focusing on the more-heterogeneous sources of diversity within fields and the institutional embeddedness of technical considerations. The concept of logic generally refers to broader cultural beliefs and rules that structure cognition and guide decision-making in a field. At the organization level, logic can focus the attention of key decision-makers on a delimited set of issues and solutions, leading to logic-consistent decisions that reinforce extant organizational identities and strategies. In line with the new institutionalism, social rule system theory stresses that particular institutions and their organizational instantiations are deeply embedded in cultural, social, and political environments and that particular structures and practices are often reflections of as well as responses to rules, laws, conventions, paradigms built into the wider environment.

Kathleen Thelen and Sven Steinmo contrast New Institutionalism with "Old Institutionalism", which was overwhelmingly focused on detailed narratives of institutions, with little focus on comparative analyses. Thus, the Old Institutionalism was unhelpful for comparative research and explanatory theory. This "Old Institutionalism" began to be undermined when scholars increasingly highlighted how the formal rules and administrative structures of institutions were not accurately describing the behavior of actors and policy outcomes.

There is no agreed upon definition of institution in new institutionalist scholarship. Mats Alvesson and Andre Spicer wrote in 2018 that it had become "difficult to agree what an institution is not – because institutions have become everything... When the term institution is defined, it is done so in broad and vague ways."

Numerous scholarly approaches have been described as being part of New institutionalism.