Exploring the Definition of Institution: Assessing Recent Alternative Approaches in Defining Institution

Although the scheme and foundation of institutionalism is based on the concept of institution, but there is no common understanding and definition of institution; in fact, with their fundamentally distinct perceptions and approaches, different theoreticians have defined institution in different ways. Therefore, through a descriptive-analytical method, the present study seeks to conceptually classify the definitions generally proposed after the revival of institutional economics by reviewing them. Most of the definitions proposed in recent decades may be classified under behavioral, equilibrium, structural, normative, and rule-oriented concepts. An assessment of the above said interpretations shows that structural and normative approaches regarding institution are defective expressions of the rule-oriented one, while behavioral and equilibrium definitions face problems such as lack of comprehensiveness, logical fallacy, mixing nature and capacity, weakness in expressing institutional changes and conflict with the assumptions of new institutionalism. Therefore, defining the institution as a rule, despite all criticisms pertaining to it, is preferred over other approaches.