(P1-6) Institutions – A family of Concepts?

Yesterday we (Tina, Michiel, Carl, Gerrit-Jan and me) had a brainstorm meeting over the peer-reviewed, published article by Michiel on Big Data and what credible bargaining powers consumers can feasibly command in order to be taken seriously while endeavoring to participate in the shaping of privacy contracts, case law and legal rules that protect their informational privacy.

The article itself was generally considered useful and informative, its reasoning innovative, mainly considering economic argument for estimating bargaining powers and considering the level of participation as a proxy for rule-promulgation legitimacy. One of the remarkable accomplishments in the article is the adoption of several of Komesar’s models, like Comparative Institutional Choice and explicit attention for the reciprocally intertwined functions of legslation, adjudication and the political process.

Of course there were critical remarks. Carl pointed out that there is a problem with adopting the marginal-cost mechanism as relevant in consumer privacy contracting between consumers (like you) and producers (like Google). I had to confess that Michiel’s adopting the very special ways that Komesar chooses to define and use the concept of “Institution” as general gospel was so hard for me to swallow, that I really had difficulty to finish reading the article.

I still think this could have been easily mended, by beginning for instance with North’s general (and widely adopted) definition and adding (where relevant) specifics for the three legal institutions that are central to legal theory (and are actually used in the dicussion). Actually, this comment is better directed to the way Komesar himself does present his ideas.

It is clear that the “institution” concept gets to the heart of many. My previous blog shows my commitments, and whole regiments of  prominent scholars discuss the issue, Veblen, Coase, Fuller, Olson, the Ostroms, North, Hodgson, Greif and Shaffer (who provides an overview that includes Komesar’s conceptualization) are a mere subset.

[I write this during my holidays — references and elaborations if still opportune will follow]


Fuller, Lon L. 1969. The morality of law, Second Edition, Yale University Press. [p. 124-129 are relevant to the subject]

Hodgson, Geoffrey M. 2006. What are institutions. Journal of economic issues, XL(1), 1–25. [The discussion with North is revealing]

Greif, Avner. 2006. Institutions and the path to the modern economy: Lessons from medieval trade. Cambridge University Press. [My personal understanding of institutions as a concept emerged from having to accomodate the combination of (as I admire them all) Fuller’s legal system, Grief’s institution and Wittgensteins notion of language games]

Olson, Mancur. 2000. Power and prosperity: Outgrowing communist and capitalist dictatorships. Basic Books.

Michiel Rhoen, ‘Big Data and Consumer Participation in Privacy Contracts: Deciding who Decides on Privacy’ (2015) Utrecht Journal of International and European Law  31(80) 51, DOI: http://dx.doi. org/10.5334/ujiel.cu

Shaffer, Gregory. 2013. Comparative institutional analysis and a new legal realism. Wisconsin law review, 607–628.

Veblen, T. 1898. Why is economics not an evolutionary science? The quarterly journal of economics, 12(4), 373–397.

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