Home
/
RELIGION & LIBERTY ONLINE
/
From folkways to institutions: Why culture matters for the economy
From folkways to institutions: Why culture matters for the economy
Aug 27, 2025 5:23 PM

In our efforts to reduce poverty and spur economic growth, we can be overly consumed in debates about top-down policy tactics and the proper allocation of physical resources. Yet, as many economists are beginning to recognize, the distinguishing features of free and flourishing societies are more readily found at the levels of culture—attitudes, beliefs, and imagination.

According to economist David Rose, for example, “it is indeed culture—not genes, geography, institutions, policies, or leadership—that ultimately determines the differential success of societies.” Or, as Deirdre McCloskey argues, it is “ideas and rhetoric,” not capital, or even our institutions, which deserve our utmost praise and attention. “Our riches did e from piling brick on brick, or bachelor’s degree on bachelor’s degree, or bank balance on bank balance,” she writes, “but from piling idea on idea.”

But while this certainly helps us locate a starting point, might there be more to “culture” than simply our attitudes and ethics, “ideas and rhetoric”? According to economist Arnold Kling, we’d do well to expand our vision of “culture” to also include institutions, taking a plete and cohesive view of the space between individual and state.

“I suggest that we should stop trying to talk about culture and institutions as if they were separate,” Kling writes in response to Rose’s new book. “Instead, I propose that we think of culture as having ponents: informal culture, which we can call folkways; and formal culture, which we can call institutions. In this framework, institutions are subsumed under culture, as an aspect of culture, a subset of culture, or a manifestation of culture.”

Using the art of dance as an example, Kling recounts how “the hustle” became a widespread cultural phenomenon—originating casually among Puerto Rican teenagers (folkways), but eventually rising to prominence, and thus, codification and formal education and formal practice (institutions).

Kling describes the distinction as follows:

Folkways are beliefs and practices that develop within a society by a process of modification and imitation. Institutions are beliefs and practices that are consciously formulated. Institutionalized culture is codified, often in writing. Terms are defined, and practices are standardized. People stop to analyze why certain practices are necessary and to debate whether particular modifications are acceptable. Experts are recognized and certified. Organizations are formed. Individuals and organizations make capital investments pertinent to the particular cultural phenomenon.

Some aspects of culture are closer to folkways. Other aspects of culture are highly institutionalized. Some aspects fall in between.

Drawing from economist Hernando de Soto’s The Mystery of Capital, Kling offers the example of property rights. “In poor countries, squatters will attempt to assert property rights, and these can be recognized by folkways,” Kling explains. “But [de Soto] pointed out that only when these property rights are institutionalized can they be used to build wealth.”

Or, as de Soto explains in the Acton Institute’s PovertyCure series: “Try and imagine a football match without rules…The rules are crucial to get that game going. But everyone knows how to drive a ball. Everybody knows how to buy and sell, so there is plenty of entrepreneurship in the world. The problem is the rules. In two-thirds of the world, there isn’t yet the rule of law.”

The basic fight for healthy institutions and a healthy institutional framework is deeply connected to the shape of our cultural attitudes and imaginations. Thus, at least in our modern context, it’s important that we pursue and promote both folkways and institutions, and recognize the back-and-forth cultural reinforcement that’s necessary if society is to flourish.

“In an adverse institutional environment, people who might otherwise engage mercial activity and encourage others who do likewise might instead find mercial inclinations repressed or corrupted,” Kling concludes. “But in a society where the folkways discourage innovation or economic success, having a legal framework conducive to capitalism probably will not be sufficient to create a thriving market economy.”

Such a distinction may seem trivial, but its implications reach well beyond nit-picky academic debates among economists and economic historians. Indeed, in our current cultural vocabulary, we already blur many of these lines without considering the full ripple effects of what we’re actually valuing and what we’re ultimately fighting for.

In the broader political discourse, for example, we see politicians like Sen. Mike Lee and thinkers like Tim Carney and Charles Murray reminding us of the need for a vibrant civil society and the “associational life” that’s found in local institutions—political and economic, but munal, educational, religious, and so on. How we approach folkways vs. institutions and the connections in between is essential for fostering a healthy cultural framework in these areas.

Likewise, within the church, we see a renewed awareness of the value of cultural institutions. “For cultural change to grow and persist, it has to be institutionalized,” writes Andy Crouch, “meaning it must e part of the fabric of human life through a set of learnable and repeatable patterns. It must be transmitted beyond its founding generation to generations yet unborn.” Or as Chris Horst explains, “Institutions reinforce or repudiate our values. They develop or diminish the dignity of people living in our society. They can impair or allow us to plish more together than we could ever do alone.”

By expanding and enhancing our view of culture as such, we have a clearer framework for organizing our thoughts and actions—fighting not just for the organic creativity and value creation of bottom-up innovators and entrepreneurs, but also for stronger and enduring cultural pathways to reinforce and preserve what our freedom has already proven to yield.

Image: Netherlandish Proverbs, Pieter il Vecchio Bruegel (Public Domain)

Comments
Welcome to mreligion comments! Please keep conversations courteous and on-topic. To fosterproductive and respectful conversations, you may see comments from our Community Managers.
Sign up to post
Sort by
Show More Comments
RELIGION & LIBERTY ONLINE
Reply to The New York Times: Online worship is still worship
A Lutheran pastor takes issue with a recent Times essay declaring that online religious services should end. But what does it mean to be church? And what does it mean to worship the God es to us wherever we are? Read More… I love watching men’s college basketball. Three e to mind that I’m so thankful to have seen on TV—Chris Jenkins’ buzzer beater to lift Villanova over North Carolina in 2016, Christian Laettner’s dagger to catapult Duke past Kentucky...
The Scottish play comes alive in imaginative new Joel Coen film
If you think you’ve seen it all before, perhaps many times before, think again. Expressive direction and Denzel Washington make this a Macbeth for a new era. Read More… Who needs another version of Macbeth on film? You may find yourself asking this question with the release of director Joel Coen’s The Tragedy of Macbeth, which stars Denzel Washington in the title role and, in the part of Lady Macbeth, Coen’s seemingly ubiquitous wife, three-time Academy Award winner Frances McDormand....
House of Gucci is Ridley Scott’s “Basta!” to the commercialization of art
Starring Lady Gaga, Adam Driver, and Al Pacino, this mockery of elites as little more than decadent mafiosi may grab some Oscar nods, but The Godfather it isn’t. Read More… My first Oscars essay presented Wes Anderson, the Hollywood dandy’s Francophilia, The French Dispatch, and gentle criticism of liberal intellectual pretense. The 2022 Oscar contenders also include an examination of American Italophilia—veteran Ridley Scott’s House of Gucci, as full of today’s stars as Anderson’s movies are of yesteryear’s. Lady Gaga...
A year after coup, Burmese people continue to resist brutal military rule
February 1 marked the one-year anniversary of the military coup that has seen widespread chaos and destruction in Burma. Nevertheless, a younger generation continues to fight for democratic ideals against terrible odds. Read More… A year ago Burma’s military staged a coup.The juntahas since killed at least 1,500 people and detained another 12,000, of whom nearly 9,000 remain in custody. A couple thousand sought by the regime are in hiding. TheUnited Nations estimatesthat 2,200 civilian homes and other buildings have...
Ilya Shapiro’s ill-worded tweet and the crying game
When a Georgetown law mented on the relative merits of a potential SCOTUS pick, all hell broke loose. Black students demanded a form of “reparations” in response, including a room to “cry.” Have we reached peak “white guilt” yet? Read More… Ilya Shapiro, a Russian émigré, a serious scholar of the American Constitution, and formerly of the libertarian Cato Institute until he was scheduled on February 1 to begin running Georgetown’s Center for the Constitution, has found himself in a...
Is The Lost Daughter this generation’s A Doll’s House?
A fine performance by Olivia Colman and a Euro-style directorial debut by Maggie Gyllenhaal have garnered rave reviews, but this film about a mother abandoning her children is amazing in ways that should give pause. Read More… In Henrik Ibsen’s seminal play A Doll’s House, protagonist Nora Helmer, a hitherto devoted wife and mother, walks out on her husband and their three children, significantly slamming the door behind her in the last scene. The idea of a mother leaving her...
What message does NBC’s Olympics coverage send?
The network admits that diplomacy will not dissuade the CCP mitting atrocities against its people—but why assist in promoting a veneer of normalcy? Read More… The media world is not a principled one, and its decisions are often not moral in nature. Standards of coverage are rarely dictated by the metric of right versus wrong but by popular versus unpopular—determined more by what’s likely to attract viewership than what certain subsets of the viewing public may deem the right thing...
Joe Rogan is not a problem, but a mirror
The controversial podcaster has e a lightning rod for those who don’t want to be associated with unvetted ideas expressed by either him or his guests. Yet those ideas may not be novel as much as reflective of what the silent majority is already thinking. Read More… The Joe Rogan Experience is one of the world’s most popular podcasts and, for the past two weeks, the world’s most controversial. Launched in 2009 edian and martial arts enthusiast Joe Rogan, the...
Saving men requires the leadership of laymen
Attempts to “save men” in the past, both for the church and from themselves, have often made things worse by making men more passive. It’s time for men in the pews to take control of their own healing. Read More… Progressives are finally waking up to the reality that men and boys are struggling in America. On January 27, Andrew Yang posted a Twitter thread observing that “there’s a crisis among American boys and men that is too often ignored...
Christian leaders sign petition asking for amnesty for Jimmy Lai and his co-defendants
The petition asks Hong Kong chief executive Carrie Lam to pardon pro-democracy publisher and entrepreneur Lai and others and to correct the “terrible injustice” that has been inflicted on them through the implementation of the Beijing-inspired National Security Law. Read More… A worldwide coalition of Christian leaders submitted a petition to Carrie Lam, chief executive of Hong Kong, asking her to grant amnesty to individuals charged under the city’s repressive National Security Law (NSL), including one of the city’s most...
Related Classification
Copyright 2023-2025 - www.mreligion.com All Rights Reserved