In recent years, archaeological scholars have recognised the importance of institutions in their interpretations of evidence concerning the past (Holland-Lulewicz et al. Reference Holland–Lulewicz, Conger, Birch, Kowalewski and Jones2020; Ögren et al. Reference Ögren, Hedenstierna-Jonson, Ljungkvist, Raffield and Price2022; Raffield et al. Reference Raffield, Bønding, Cooijmans, Moen and Taggart2025). Reasons given for an ‘institutional turn’ are varied. The article by Anders Ögren, Charlotte Hedenstierna-Jonson, John Ljungkvist, Ben Raffield, and Neil Price (Reference Ögren, Hedenstierna-Jonson, Ljungkvist, Raffield and Price2022, 1) suggests institutional analysis is a means of ‘visualizing immaterial culture’, that is, a means to understand underlying structures which they surmise existed in the Viking Age, but which are not visible in the archaeological record. They propose the new institutional economics (NIE) as an appropriate ‘toolbox’ to study these invisible structures and their effect on the Viking Age economy. While we welcome their institutional turn, they draw on highly limited resources within the NIE and do not incorporate the original institutional economics.

The NIE was launched in the 1970s by Coase, North, and Williamson, and to whom we should add Ostrom, Acemoglu, Johnson, and Robinson. They have all received Nobel Prizes in this field. The NIE distinguishes itself (at least chronologically) from the original American institutional economics (OIE), which was prominent in the first half of the 20th century and included Thorstein Veblen, John R. Commons, John Maurice Clark, Wesley C. Mitchell, and others. But Ögren et al. overlook the OIE in favour of a selective part of the NIE, even though the NIE and OIE are both diverse internally and the demarcations between them are complex and shifting, to a degree (Dequech Reference Dequech2002). While the NIE does provide some valuable insights, the OIE may also have something important to offer.

For example, when Ögren et al. (Reference Ögren, Hedenstierna-Jonson, Ljungkvist, Raffield and Price2022, 174) explain that the ‘NIE assumes that an agent’s behaviour is subject to many sorts of rules (labelled “institutions”) … which are formal as well as informal’, very similar claims were made much earlier by the OIE as well, and they should also receive credit. Furthermore, the Ögren et al. view of the NIE is partial. They mention Douglass North several times, but Coase is mentioned only once in the main text, and Ostrom, Williamson, Acemoglu, Johnson, and Robinson are ignored. Their reliance on North for defining NIE’s core beliefs should recognise that North’s views actually changed over the course of his career, showing a noted degree of convergence with OIE principles, although some important differences remained (North Reference North2003; Groenewegen et al. Reference Groenewegen, Kerstholt and Nagelkerke1995). It is also worth noting that Ögren et al. (Reference Ögren, Hedenstierna-Jonson, Ljungkvist, Raffield and Price2022, 183 n. 3) add Robert Fogel as a ‘pioneer within the NIE’, but in fact, he is rarely regarded as such, as his approach was quite different from other NIE economic historians. Fogel is not mentioned in major handbooks or textbooks of the NIE, such as Alston et al. (Reference Alston, Alston, Mueller and Nonnenmacher2018), Brousseau and Glachant (Reference Brousseau and Glachant2008), or Ménard and Shirley (Reference Ménard and Shirley2005).

We also note that Ögren et al. (Reference Ögren, Hedenstierna-Jonson, Ljungkvist, Raffield and Price2022, 176) point out that ‘power relations are at the core of NIE’. However, the OIE said much more about the pervasive role of power in the economy than the NIE, because the NIE often treats individuals and their preferences as given. If preferences are malleable, as the OIE often pointed out, then people can be more easily manipulated by the powerful. Often, power operates through subtle persuasion and enduring circumstance, and not simply via coercion or constraint (Lukes Reference Lukes1974). These softer mechanisms of power were a key feature of Thorstein Veblen’s work, among others. For example, Veblen wrote (Reference Veblen1899, 190–1): ‘The situation of today shapes the institutions of tomorrow through a selective, coercive process, by acting upon men’s habitual view of things, and so altering or fortifying a point of view or a mental attitude handed down from the past.’ He argued repeatedly that circumstances affect behaviours, which in turn change or create new habits, and these lead to shifts in individual dispositions or preferences.

There is also a danger of over-generalising about the NIE. For example, Ögren et al. (Reference Ögren, Hedenstierna-Jonson, Ljungkvist, Raffield and Price2022, 176) wrote: ‘The assumption that social context is codified in the institutional framework implies that incentive structures will guide the behaviour of economic agents, as they are rational in the bounded sense.’ First, the premise does not imply that incentive structures alone matter. As stressed by OIE authors among others, culture matters too. Furthermore, some but not all NIE economists embrace Herbert Simon’s concept of bounded rationality. Williamson (Reference Williamson1981) repeatedly endorsed the concept of bounded rationality, whereas, in contrast, Coase and North did not make much of the idea. But ironically, the basic idea of bounded rationality (without using the term) is found in some OIE writings. For example, John Maurice Clark (Reference Clark1918, 23) wrote of the ‘effort of decision’, including the ‘effort of attention’, and of ‘the exhausting character of choice’. For Clark, too, rationality in practice was bounded by cognitive limitations.Footnote ¹

Both Coase (Reference Coase1988, 2–4) and North criticised the core assumption of rationality in economics. In addressing the question of how people make economic choices, North (Reference North2003, 2) has noted:

North (Reference North2003, 5) moved away from standard rationality assumptions in his theory, giving increasing emphasis to cognitive issues, the influence of ideology, and of cultural norms, which he argued were important ‘because they underpin the way in which people make choices’. He even suggested (Reference North1994, 362), ‘It is necessary to dismantle the rationality assumption underlying economic theory in order to approach constructively the nature of human learning’.

Ögren et al. (Reference Ögren, Hedenstierna-Jonson, Ljungkvist, Raffield and Price2022, 174) wrote: ‘On a macro level, NIE assumes that rules are instigated to facilitate economic organization by decreasing insecurity in transactions’. An electronic search for the phrase ‘insecurity in transactions’ found only one appearance of that term, in a journal of human geography and not by an institutional economist. Instead, we can find many uses by new institutional economists considering the ‘insecurity of property rights’ and the ‘costs of transactions’. Complicating matters further, within the NIE there is inadequate consensus on what ‘property rights’ or ‘transaction costs’ mean, and how they are defined (Barzel and Allen Reference Barzel and Allen2023; Hodgson Reference Hodgson2015; Reference Hodgson2025a; Reference Hodgson2025b). It is also unclear to us why Ögren et al. place questions about organisations, rules, and rule-following on the macro level, since individual rule-following is a micro issue and much (new and old) institutional analysis is of firms and other micro-level organisations.

Ögren et al. (Reference Ögren, Hedenstierna-Jonson, Ljungkvist, Raffield and Price2022, 175) wrote: ‘Transaction costs represent the summary of all costs that arise owing to the insecurity involved in market transaction’. This is not a typical definition of a transaction cost, and there are several from which to choose (Hodgson Reference Hodgson2025a; Reference Hodgson2025b). In Coase’s (Reference Coase1937, Reference Coase1960) two classic articles that founded the transaction cost approach for institutional economists, words such as ‘insecure’ or ‘insecurity’ do not appear. We have found no work by North or Williamson that associates words like ‘insecure’ or ‘insecurity’ with transaction costs.

Ögren et al. (Reference Ögren, Hedenstierna-Jonson, Ljungkvist, Raffield and Price2022, 177) also discuss the NIE’s contribution to ‘the idea of the spontaneous social order’, claiming the NIE adds to it an insistence that ‘rules to uphold social order must be codified in some way.’ However, this idea has existed ever since the earliest attempts to write down laws millennia ago. For instance, in his history of ancient Rome, Titus Livius (Reference Livius1853, bk. 3, 169) recorded the popular demand in around 450 B.C. that laws should be written down, giving reasons why this was seen as important. Later writers such as John Locke in his Second Treatise of Government (Reference Locke1980, section 124, 66) and Thomas Hobbes in Leviathan (Reference Hobbes1909, 219) also insisted on the importance of written laws. Such insistences long precede the NIE.

Additionally, Ögren et al. (Reference Ögren, Hedenstierna-Jonson, Ljungkvist, Raffield and Price2022, 177) do not ‘oppose the economic idea that social order and organization may well be a product of unfettered rational agents’. Indeed, many people may invoke rationality in their explanations of social order, including some from the NIE (but not Coase Reference Coase1988, 2–4). But it is problematic to suggest that ‘social order and organization’ are ‘a product of unfettered rational agents’ when human agents routinely act within some fetters or constraints, whether they be social or natural.

Finally, we note that in their discussion of the NIE’s combination of economics and political science through the ‘analytical narratives’ school, Ögren et al. (Reference Ögren, Hedenstierna-Jonson, Ljungkvist, Raffield and Price2022, 176–177) state: ‘it is possible to replace the concept of the “state” with any ruler in ancient history’. However, rulership, or even a leader’s ability to ‘withhold protection or confiscate private wealth’, does not necessarily imply a state. A state involves much more than a ruler exercising coercive power. It also includes a set of institutions with rules for governing and legislating, as well as determining the component social position (king, emperor, etc.) of the ruler itself. For instance, regarding the Early Middle Ages – of which the Viking Age, the subject of Ögren et al.’s article, was a part – Wickham (Reference Wickham2006, 303) has characterised a ‘state’ using five very specific criteria including the necessity for ‘the centralization of legitimate enforceable authority’ and the ‘specialization of governmental roles, with an official hierarchy which outlasted the people who held official position at any one time’. Likewise, Douglass North (Reference North1991, 97) emphasised that institutions, not individuals, are what structure governance and order, suggesting that the state, articulated as institutional frameworks, is distinct from any one person. Therefore, a state is an example of institutionalised power that transcends any individual ruler. Ögren et al.’s statement seems to conflate an individual with an institution.

Their paper proceeds to make points about Viking Age Scandinavian culture. Ögren et al. (Reference Ögren, Hedenstierna-Jonson, Ljungkvist, Raffield and Price2022, 183), for instance, conclude that the deployment of NIE ideas ‘will also shed new light on economic organization by moving away from such archaic concepts as “gift-giving” and provide new rationale to the possibilities of specialization, fiscal issues … political and economic hierarchies and, most notably, the existence of elaborated trading networks.’ But the specifics of what the NIE adds to this and its value in this context would benefit from further demonstration.

Ögren et al. (Reference Ögren, Hedenstierna-Jonson, Ljungkvist, Raffield and Price2022, 176) make use of the popular concept of social capital. This was famously promoted by the sociologists Pierre Bourdieu (Reference Bourdieu and Richardson1986) and James Coleman (Reference Coleman1988), and it has become popular in sociology and elsewhere, including in viking studies (Ashby Reference Ashby2015). But social capital is not a widely used concept in the NIE with the exception of Ostrom (Ostrom Reference Ostrom1995; Ostrom and Ahn Reference Ostrom, Ahn, Ostrom and Ahn2003). Even some sociologists have argued that concepts such as ‘cultural capital’ and ‘social capital’ lump too much under one heading to be of great use. Michèle Lamont and Annette Lareau (Reference Lamont and Lareau1988) explored several confusions of meaning and argue that if there is such a thing as ‘cultural capital’, then differences in social context should be given more expression. Similar remarks are made by John Goldthorpe (Reference Goldthorpe2000) in his On Sociology. Alejandro Portes (Reference Portes1998) argued that the metaphor of ‘social capital’ is over-hyped, empirically-overloaded, and is of exaggerated explanatory value. Geoffrey Ingham (Reference Ingham2004) and Geoffrey Hodgson (Reference Hodgson2014) argued that Bourdieu and others misuse the real-world concept of capital, which undermines their wide extension of the term.

Once again, while Ögren et al. (Reference Ögren, Hedenstierna-Jonson, Ljungkvist, Raffield and Price2022) cited a prominent conceptual approach, the discussion could be expanded to include alternative approaches and more details about how it may help to understand Viking Age phenomena. While we appreciate Ögren et al.’s advocacy for the application of an institutional approach in their attempt to visualise the immaterial culture underpinning the viking economy, their understanding of the NIE appears to focus only on a specific subset of the theory, leaving room for more comprehensive engagement by also considering the potential contributions of the OIE in this area.

Veblen’s work is crucial among institutionalist approaches, and yet Ögren et al. only mention his name once. Veblen (Reference Veblen1898; Reference Veblen1919) applied Darwinian evolutionary theory to institutions, including in the economy, to help understand the historical causes of their formulation, how they changed through time, and how they shape people’s dispositions and behaviour. He viewed the economy as part of an evolving ‘organic whole’ (Reference Veblen1899, 201) that had been created by previous processes and was, importantly, interwoven into broader cultural, social, and political relationships. This broader view is crucial for understanding socio-economic motivations, including those in Scandinavia during the Viking Age.

Much of economic theory today assumes that individuals have fixed preference functions. Institutions, prices, or technology may change, and with them an individual’s behaviour. But underlying preference functions remain fixed. Veblen (Reference Veblen1898, 390) rebutted this notion of a human – what he referred to as ‘a self-contained globule of desire’. He used the psychological concept of habit to show how individuals and institutions (along with culture) can interact in deeper ways, whereby not only institutions change through their interactions with individuals, but also individuals can be changed quite fundamentally by their institutional and cultural environment. Individual preferences, dispositions, and capabilities can all change. Both ‘top-down’ and ‘bottom-up’ processes are involved (Veblen Reference Veblen1909, 628–30; Hodgson Reference Hodgson1998). Therefore, we argue, in accordance with Veblen, that understanding the complex dynamics which defined the Viking Age requires abandoning the economic assumption that people’s preferences and motivations never change.

Some of Veblen’s work also resonates with North’s (Reference North1990) concept of path dependence (or ‘dependency’ in his version), namely that our cultural inheritance – the historical path we are on – was created by ‘a set of institutions and beliefs that have been carried forward over the generations’, and that we are dependent on it for constituting how we perceive the world. This path is sometimes deeply embedded, and we have limited ability or resources to divert from it (North Reference North2003, 4–5).

In summary, we believe the increased interest in an institutional approach to the past is a positive development. Ögren et al. (Reference Ögren, Hedenstierna-Jonson, Ljungkvist, Raffield and Price2022, 172) suggest it is the NIE that provides ‘the ways in which further research could provide a new understanding of economic interaction’ in the past. However, we argue that a more comprehensive understanding can be gleaned by also integrating insights from the OIE, such as Veblen’s ideas, which focus particularly on the importance of evolutionary processes, history, and culture in institutional formulation. NIE scholar Douglass North’s own intellectual journey, which increasingly aligned with the OIE regarding the roles of history, power, and beliefs, tells us that the willingness to include both institutional frameworks into our investigations of the past may provide the perspective necessary for gaining a richer and more nuanced understanding of not only a complex period such as the Scandinavian Viking Age, but of any period’s ‘immaterial culture’.