Habit, sedimentation and economic institutions

Summary

The concept of sedimentation from phenomenology bridges embodied-enactive theories of habit with how habits and routines shape social practices and institutions. Institutional economics recognizes that institutions shape individual and social habits but says little about how individual habits evolve into institutions. Sedimentation provides a fuller account of these interrelations. Sedimented habits can be structurally rigid and difficult to change, yet they are performatively flexible and adaptive in situated action. This performative flexibility reflects principles of transactional plasticity that extend to institutions.

Study at a glance

Abstract

Abstract The concept of sedimentation, developed in phenomenology, provides a bridge between recent discussions of habit in embodied-enactive theories of cognition and skilled performance and conceptions of how habit and routine function in social practices and institutional formation. Although the notion of habit is little discussed in mainstream neoclassical economics, various theorists of institutional economics rightly suggest that institutional structures can shape individual and social habits and routines. At the same time they ignore or say very little about how individual habits and social interactions evolve into institutions. I argue that the analysis of sedimentation can provide a fuller account of the dynamical interrelations between habitual and institutional processes. With a specific focus on the way sedimentation works, I make two suggestions. First, although sedimented habits can be structurally rigid, and often difficult to change, they are also performatively flexible and adaptive in situated action. Second, this performative flexibility reflects principles of transactional plasticity that carry over to institutions.