Shared Mental Models: Ideologies and Institutions

@inproceedings{Denzau1993SharedMM,
  title={Shared Mental Models: Ideologies and Institutions},
  author={Arthur T. Denzau and Douglass Cecil North},
  year={1993}
}
The rational choice framework assumes that individuals know what is in their self interest and make choices accordingly. However, sometimes, especially in situations of uncertainty rather than risk, people act in part upon the basis of myths, dogmas, ideologies and "half-baked" theories. We begin this essay by noting that it is impossible to make sense out of the diverse performance of economies and polities if one confines one's behavioral assumptions to that of substantive rationality in… 

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