Adaptive governance is a concept from institutional theory that deals with the evolution of institutions for the management of shared assets, particularly common pool resources and other forms of natural capital. This paper is the first of a set of four papers on adaptive governance, providing a brief overview of the history of the concept, the distinguishing features of the literature, and key insights provided for economists and policy advisors. We argue that adaptive governance provides an interesting lens for examining the political economy of policy responses akin to the concept of market failure within economics, but applied to wider processes of social learning and collective choice, including collective choices about the scope and structure of institutions that govern lower level choices by individuals and organizations.