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Edmund Husserl introduced the concept of the lifeworld in his Crisis of European Sciences (1936), following Martin Heidegger's analysis of Being-in-the-world (In-der-Welt-Sein) in Being and Time. The concept was further developed by his student Jan Patočka, the Husserlian Alfred Schütz, Maurice Merleau-Ponty, Jürgen Habermas, and others.
For Habermas, lifeworld is more or less the "background" environment of competences, practices, and attitudes representable in terms of one's cognitive horizon. It's the lived realm of informal, culturally-grounded understandings and mutual accommodations. Rationalization of the lifeworld is a keynote of Habermas's 2-volume Theory of Communicative Action. Penetration of lifeworld rationality by bureaucracy is analyzed by Habermas as 'colonization of the lifeworld'.
Social coordination and systemic regulation occur by means of shared practices, beliefs, values, and structures of interaction, which may be institutionally based. We are inevitably lifeworldly, such that individuals and interactions draw from custom and cultural traditions to construct identities, define situations (at best, by coming to understandings, but also by negotiations), to coordinate action, and create social solidarity. (See also: Seidman, 1997:197)
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One might also cross refer to Pierre Bourdieu's notion of 'habitus'
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