The social fabric matrix (SFM) together with the principles of institutional adjustment (PIA) may be used within the theoretical framework of the Veblenian dichotomy. This combination advances the conceptual and empirical reach of both. The Veblenian dichotomy is used to analyze the relationship of instrumental and ceremonial behaviors to institutions. It ties together the PIA and the SFM. The SFM identifies and incorporates several components for examining a problem and attempting to develop policies. The analysis of change is an important aspect of Institutional economics. Change involves adjustment of ceremonial behaviors to instrumental ones. Change in both group and individual behavior is controlled by the PIA. Habit adjustment is the individual counterpart to institutional adjustment. Perception of circumstances and consequences control behavior, and perceptions are controlled by habits. The potential directions and ability of an institution/habit to change can be informed by use of the SFM. The subject matter of this chapter is the connection of these and their application to institutional and individual adjustment.