Cognitive Institutionalism

Cognitive Institutionalism is a concept within Institutional Economics that emphasizes the role of societal beliefs, perceptions, and mental frameworks in shaping economic behavior and institutions. It suggests that our understanding of economic activities is influenced not just by rules and regulations, but also by shared values and cognitive schemas within a society. These mental models guide how individuals interpret their experiences and make decisions, ultimately affecting the formation and evolution of institutions. In essence, it highlights that economics is not only about tangible resources but also about the ideas and beliefs that drive human interactions.