D.1. The Role of Institutions: The set of institutions prevalent at the time of Analysis is taken as given.
E.1. If it were not assumed that there are certain sets of institutions which influence transactions, or economic engagements etc, the analysis would yield results of kinds impossible to relate to in real life. For instance, one may knock out another and steal all apples from them, and in this way gain more apples at price of a punch without giving up his other resources, say Bananas. Such a transaction of saving apples and gaining Bananas cannot enter in our study as they are not how ordinary or the most frequent dealings are conducted, and are punishable by law.
While institutional subversions are observable, institutional arrangements nevertheless affect our engagements, and mitigate or lower the frequency of subversions significantly.