“They (social costs) are damages or diseconomies sustained by the economy in general, which under different institutional conditions could be avoided. [... ] if these costs were inevitable under any kind of institutional arrangement they would not really present a special theoretical problem. [... ] to reveal their origin, the study of social costs must always be an institutional analysis. Such an analysis raises inevitably the question of institutional reform and policy.”

—  Karl William Kapp

Source: Social Costs of Business Enterprise, 1963, p. 186 cited in: Sebastian Berger and Mathew Forstater (2007) "Toward a Political Institutionalist Economics: Kapp’s Social Costs, Lowe’s Instrumental Analysis, and the European Institutionalist Approach to Environmental Policy". In: Journal of Economic Issues. Vol.XLI, No.2, June 2007. p. 539

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Karl William Kapp 6
American economist 1910–1976

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