Cosmin Marinescu is an Associate Professor at the Economics Department, the Academy of Economic Studies, Bucharest. He has published in the fields of institutional economics and Austrian economics. Recently, within the Centre for Economics and Liberty (ECOL; http://www.ecol.ro), he coordinated the volume Market Economy. Institutional Foundations of Prosperity, about free market institutions and building the market economy in post-communist Romania. E-mail: email@example.com
Transaction Costs and Institutions' Efficiency: A Critical Approach
Version of Record online: 4 APR 2012
© 2012 American Journal of Economics and Sociology, Inc.
American Journal of Economics and Sociology
Volume 71, Issue 2, pages 254–276, April 2012
How to Cite
MARINESCU, C. (2012), Transaction Costs and Institutions' Efficiency: A Critical Approach. American Journal of Economics and Sociology, 71: 254–276. doi: 10.1111/j.1536-7150.2012.00829.x
This article is supported by the Sectorial Operational Programme Human Resources Development (SOP HRD), financed from the European Social Fund and by the Romanian government under the contract number SOP HRD/89/1.5/S/62988.
- Issue online: 4 APR 2012
- Version of Record online: 4 APR 2012
Vol. 72, Issue 1, 258, Version of Record online: 20 DEC 2012
Institutions cannot “work” by themselves, that is, without necessary efforts for enforcing, preserving, and improving them. For many economists, these efforts represent the costs of the economic system at work. Nowadays in institutional economics, the costs of running the economic system are generally called “transaction costs.” This article will offer a critical approach on the significance of transaction costs. This study highlights the necessity of subordinating the efficiency criterion to the ethics criterion, not only in the human action area, but mostly in institutions, as rules of the game in the society.