interests and the creation of new institutions
Brayden
A fellow Arizona alum and Fabio’s colleague, Tim Bartley, has a well-written and fascinating paper about the creation of new institutions in the most recent issue of AJS. The paper examines the rise of certification standards, as a form of private regulation, in the forestry and apparel industries. Tim pushes a “political construction of market institutions” view. New institutions emerge out of highly contested processes involving actors with differing political and economic interests. Tim explains how this political-institutional perspective differs from a market-based explanation for the emergence of institutions.
[T]hese approaches are rooted in different theories of institutions – [the market-based explanation] based on a “cooperation-for-collective-benefits” logic in which institutions are solutions, the [political-institutional explanation] closer to a “distributional conflict” model in which institutions are settlements (312).
Although both are rooted in the idea that social actors have distinct economic interests, in the former view actors’ central problem is finding a way to cooperate and produce solutions to collective good problems, while in the latter view, actors conflict over resource distributions and institutions are created as settlements within ongoing conflict.
My take is that the political-institutional view of institution formation is a nice corrective to the overly-top-down institutional theory of sociology, but as Tim suggests in the conclusion, the political-institutional view avoids the overly-reductionist tendency of many economic theories, which take economic actors and their interests out of their constitutive historical and political contexts.
I like Tim’s paper a lot (it’s always nice when you get to see a project like this evolve from its humble beginnings to the lead slot at AJS). Yet, I think that it is still problematic to crown the “political-institutional” approach (we are going to need a catchier label than this) as a “corrective” to the old-new-institutionalism.
In particular, the PI arguments I think are couched at a completely different level of analysis than sociological institutionalism. In both Tim’s work and others (i.e. Schneiberg) the critique of sociological institutionalism piggy-backs on the polisemy of the term institution. For instance, in Tim’s article, it is obvious that he’s using the term institution in the way that Political Scientists and Economists use the term institution: rules of the game, settlements, etc. Yet as pointed by Hall and Taylor (1996), the whole point of sociological institutionalism, was to concentrate on the cognitive not regulative aspect of institutions. So the PI critique of sociological institutionalism only works by changing the subject. It does not work in sociological institutionalism’s home turf. For instance, most of the PI historical case studies dealing with the emergence of “institutions” (gleefully highlighting the presence of disorder, competing logics, conflict, power, etc. while citing Meyer and Rowan 1977 as implying this is impossible) deal in fact with the emergence of institutional arrangements not institutions in the sociological sense. The entire apparatus of the state, interest groups, social movements, etc. in fact has to be taken for granted (!) for the entire PI story to work (can we imagine a PI story featuring all of this mess for the case of social policy in France? Maybe that’s why the PI stuff is sooo American). This other stuff is the realm of sociological institutionalism, and I still haven’t heard a convincing PI story that deals with it without changing the subject or playing around with the various senses of the term institution.
Omar
October 15, 2007 at 12:48 pm
Omar, I need to remind myself to read your comment again when I’m writing a research proposal I have in mind. I think you’re right that the PIists and SIists are talking about different phenomena, for the most part (maybe Lis being the exception). But I think there is a lot potential for good research to be done looking at the micro- or meso-dynamics of cognitive disruption and delegitimation. Isn’t that what Ruef has been doing?
brayden
October 15, 2007 at 2:13 pm
Yes, Lis is a good exception. I think that one of the points that has not been digested as much is precisely something that Lis dealt with in her 1997 book: the mixture of the regulative and the cognitive during episodes of institutional change. So a good example of the cognitive level is what kinds of political associations are appropriate for women’s groups? How are cognitive schemes developed and adapted to one domain of activity transposed to a new domain? This led to a series of institutional changes in the regulative sense (ultimately the rise of the now dreaded interest groups), but a lot of cognitive issues had to be established (settled?) first. The rise of the corporation (as in the work of Roy and Coleman) is another example of how cognitive issues are first mixed up with regulative ones (is the corporation a legal actor?). Today, there are a lot of contested “institutional arrangements” and episodes of “institutional change” featuring corporations and interest groups as taken for granted (and powerful) actors. So change and contestation is happening precisely because of the existence of this largely taken-for-granted set of actors. Thus, the foreground of conflict over institutional arrangements in the PI sense requires a background of institutional taken for grantedness in the SI sense to function properly. However, observing an episode of institutional change at the PI level obviously cannot be used as counter-evidence for the theory that explains the conditions of possibility of such a change in the first place!
Omar
October 15, 2007 at 3:45 pm
Also supporting your point is the idea that when new cognitive institutions emerge, they rarely do so as settlements. In fact, it’s hard to imagine where something could become cognitively taken-for-granted as a result of a political settlement.
brayden
October 15, 2007 at 4:06 pm
[...] politics“. On distribution v. efficiency, see also this very interesting new AJS article (via OrgTheory which seeks to assess the merits of distributional and efficiency theories in explaining the [...]
Crooked Timber » » Political science and economics
October 15, 2007 at 4:32 pm
[...] of politics“. On distribution v. efficiency, see also this very interesting new AJS article (via OrgTheory which seeks to assess the merits of distributional and efficiency theories in explaining the [...]
Crooked Timber: Why economics (and its Nobel) are political « Identity Unknown
October 15, 2007 at 4:37 pm
Have you seen any evidence of an institution being created that is able to impact — in a meaningful way — the decline of our living system(s)?
And…most certification programs seem to simply provide hierarchical jobs, rather than real change. For example, many of those who actually grow organic food have opted out of the certification programs because it aids the large “producer.”
Matt Holbert
October 17, 2007 at 12:42 am
Competition is essential to creativity, but diversity is equally essential. A winner take all economy in the long run is less productive because it destroys diversity. (That is why those producers opted out of the certification programs.) Productivity and economic wealth have no intrinsic value. They are means to the end of enriching and expanding conscious experience. The forces that put too much emphasis on winning are equally a threat to diversity and quality of life. The development of some cultural counterweights will insure the diversity that is at the core of economic success.
Maia Grunwald
January 14, 2008 at 2:40 pm