Cognitive institutions: In search of new behavioral foundations of economics

Throughout the 20th century, economics followed the lead of cognitive science, but in the 21st century it has fallen behind. Cognitive scientists are actively developing the theory of extended cognition, which has gone through three stages (waves) since the mid-1990s. All three waves are based on the ideas of institutional economists, with the third wave associated with the construction of a theory of socially extended cognition based on cognitive institutions. The article offers a substantive analysis of three waves of the development of the theory of extended cognition in the context of interactions with the ideas of institutional economics. Based on this analysis, the first “sprouts” of the theory of extended cognition in different areas of economic research are assessed. In the future, we should expect an update of the behavioral foundations of economics based on the ideas of socially extended cognition, but this process will be uneven.