At the outset, it must, however, be emphasised that the management and allocation of resources within an economic system does not happen in isolation or in some abstract manner. Factors such as culture, values, education, technology, social and other institutions, political structures and legal systems all provide content and context and set the backdrop and parameters in which the different economies function.
In this regard, Douglas North writes, “It is the admixture of formal rules, informal norms and enforcement characteristics that shape economic performance… And economies that adopt the formal rules of another economy will have very different performance characteristics than the first economy because of different informal norms and enforcement”.