Working Paper No. 194. The Limits of Pragmatism in Institutional Change

Abstract

Modern politics in Western democracies is to a large extent characterized by political pragmatism, a position where feasible, incremental, and more or less technocratic improvements of the status quo are advocated. While such a position has some advantages, i.e. safeguarding against false ideologies and bad radical reforms as well as more populist policies, this paper argues that there are limits to pragmatism in “welfare-enhancing” institutional change. Pragmatism cannot deal with situations where a whole interpretative framework needs to be changed in order to achieve beneficial institutional change. The status quo may be highly inefficient and still cannot be improved by marginal adjustments due to outdated or false mental frameworks, special interests and institutional lock-in. In such situations an ideological shift may be a prerequisite for higher efficiency and welfare. A position that may combine the strengths in each of the perspectives may be called “principled pragmatism”.

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