Radical institutionalism is critical analysis aimed at describing the workings of an economic system with the intent of purposefully altering that system toward more democratic and participatory social structures and practice.
The defining characteristic of institutional analysis is the use of the concept of culture and instrumental value theory; to be radical it must be used in a processual or evolutionary way. The use of these tools of analysis in processual ways avoids the pitfalls of value absolutism. Non-radical institutionalism is static descriptions of socially organized behaviour without explanation in terms of cultural processes.
The most important analytic tool for radical institutionalism is the Veblenian dichotomy, which looks at cultural patterns of behaviour as the outgrowth of cultural processes. Those processes are identified as ceremonial processes (or institutions) and instrumental (or technological) processes.
Institutionalism views economic thinking as largely an artificial worldview which resulted from 18th century naturalism. Institutions are in fact more important a factor in development then rent, wages and profit. The progress of technology isn’t dependent on “economics” but “economics” is dependent on technology. Most importantly institutionalism is not a theory of “progress”, it is an existential theory of culminitive cause and effect of human action.