The present paper explains why social dilemmas are endemic to the regime of functional differentiation theorized by Niklas Luhmann. It is argued that within this regime, social systems combine two systems‐theoretic identities elaborated by the theories of Luhmann and Bertalanffy. Social systems are operationally closed and thus limitedly sensitive to the environment; at the same time, they are metabolically dependent on it. Social dilemmas are shown to originate from the conflict between these two identities, a conflict that occurs when social systems disregard their critical environmental dependence. An implication of the argument is that economic incentives present the individual‐level projections of systemic imperatives arising from the operational closure of the functional system of the economy. This implication informs the institutional economics analysis of social dilemmas by explaining these in terms of the excessive intensity of economic incentives that makes economic actors insensitive to their critical dependence on their environment. Copyright © 2014 John Wiley & Sons, Ltd.

The public discourse on the acceptability of genetically modified organisms (GMOs) is not only controversial, but also infused with highly emotional and moralizing rhetoric. Although the assessment of risks and benefits of GMOs must be a scientific exercise, many debates on this issue seem to remain impervious to scientific evidence. In many cases, the moral psychology attributes of the general public create incentives for both GMO opponents and proponents to pursue misleading public campaigns, which impede the comprehensive assessment of the full spectrum of the risks and benefits of GMOs. The ordonomic approach to economic ethics introduced in this research note is helpful for disentangling the socio-economic and moral components of the GMO debate by re- and deconstructing moral claims.

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The present paper draws upon the open systems perspective to identify the common systems-theoretic core of two schools of modern economic thought, the new institutional economics and the heterodox institutionalism. This core is shown to be in the argument that the maintenance of complexity requires appropriate self-regulatory mechanisms. While the new institutional economics focuses on the technological complexity maintained by corporate hierarchies, the heterodox institutionalism is concerned with the civilizational complexity that needs to be maintained by broader self-regulatory institutions of the public and nonprofit sector. This argument highlights the complementary and paradoxical relationship between the concepts of transaction costs and social costs analyzed by the respective schools. Corporate hierarchies may successfully exercise their self-regulatory role by economizing on transaction costs, yet in doing so they generate social costs that are reducible through the self-regulatory activity of public and nonprofit institutions.