The purpose of my paper is to consider the role of ethics in institutional economics. Ethics is a necessary foundation for institutional economics. Institutional economics is about problem solving. Problem solving is a purposeful activity involving establishing frames for recognition, processes for remediation, and objectives for resolution, all of which are value-based undertakings. Effective problem solving proceeds with a clear statement of purpose well grounded in beneficial values and value systems. Without a clear and well-grounded purpose, problem solving is little more than meddling and muddling, activity that contributes to evolutionary drift but yields little lasting benefit. Institutional economists have recognized the purposeful necessity of their work. They have not sought to divorce their work from values and value formation. Instead, purposeful intent is interwoven throughout the entire body of institutional economics.
