As an institutionalist studying empirical phenomena, I presume that individuals try to solve problems as effectively as they can. That assumption imposes a discipline on me. Instead presuming that some individuals are incompetent, evil, or irrational, and other are omniscient, I presume that individuals have very similar limited capabilities to reason and figure out the structure of complex environments.
DBx: This practice of self-discipline by the social scientist, while it is certainly not simplistic, is indeed simple – and yet it is practiced with shocking irregularity. Far too much social science – including economics – proceeds as if the analyst is more intelligent and better informed about relevant details than are the real flesh-and-blood individuals to whom that social-scientist’s findings are asserted to apply. Likewise, far too much social science – including economics – proceeds as if the social scientist is advising an apolitical social engineer who cares only about achieving as well as possible the goals that are explicit or implicit in the advisor’s recommendations.