94 4: Public Institutional Th eory
of garbage can theory and March and Olsen and their defense of it are the issues
of theory parsimony and methodology. Both views go even deeper to issues con-
cerning the philosophy of science and competing views about how to do social
science.
It is our view that modern institutional theory is past this debate, and the big
tent conception of institutional theory covers both perspectives. Rational choice
scholars applying principal-agent logic to information asymmetry and transac-
tion costs in matters of public policy are doing institutional theory. So, too, are
scholars doing interpretive thick descriptions of the same public policy matters.
Both are studying public institutions and developing institutional theory.
Summary
Th e vastness of institutional theory makes it diffi cult to neatly summarize its de-
velopment. One must, however, acknowledge the contributions of Wilson and
March and Olsen, who point out the limitations of explaining institutional behav-
ior with economics and market logic. Instead, they build theory that incorporates
structure and hierarchy, individual and group behavior, professional and cultural
norms, institutional longevity, and the interactions of individuals and organiza-
tions with their larger political, social, and economic contexts.
As a result, the framework of institutionalism can be used to explain every-
thing from the behavior of bureaucrats to the diff usion of innovation across agen-
cies or political jurisdictions. Earlier in this chapter, we state that today we are all
institutionalists. Given the fl exibility of the framework of institutionalism, this
is easy to defend. Yet because of this, institutional theory is fairly subject to the
criticism that it lacks a center of gravity, a simplifying assumption. Th is is a valid
criticism but should not cause us to lose sight of institutional theory’s very real ac-
complishments and possibilities. Th e possibilities and limitations of institutional
theory are in some ways a microcosm of the development of public management
theory itself. Th ere is a growing theoretical structure, a commonly accepted set of
defi nitions and agreed-upon premises, an elaborate if somewhat opaque vocabu-
lary, and an increasingly iterative and cumulative body of knowledge. Above all,
institutional theory highlights the unique properties and characteristics of public
institutions and their problems and promises.