what happened to resource dependence theory?

The three main sociological theories about organizations to arise in the late 1970s/early 1980s were institutional theory, population ecology, and resource dependence theory. Of the three, I think it’s fair to say that resource dependence has had the least amount of staying power. Institutional theory has become a dynasty. Population ecology is influential even beyond those who self-identify with the theory (e.g., see the prevalence of event history analysis and density dependence models). But resource dependence, although ritually cited, failed to carry forward as a vibrant research agenda among the current generation of scholars.  Why is that?*

This wasn’t always the case. You could argue that in the early 1980s, resource dependence theory had the greatest potential for developing a coherent research community. Looking at this Ngram graph, you can see that by 1982 Pfeffer and Salancik (1978) was getting cited far more often than Meyer and Rowan or Hannan and Freeman. It appeared to be the dominant theory. But something happened in 1983 that caused a sudden reversal of that trend. It’s pretty clear from the graph that in 1983 the influence of Pfeffer and Salancik began to decline while the influence of DiMaggio and Powell began to accelerate at an even greater rate.  Ecology continued to rise in influence during this same time period, peaking in citations in the mid-1990s.

The decline of resource dependence theory has a number of causes. I don’t think that the problem was that resource dependence was not a good theory. If you were able to transport your academic self back to 1983, I think you’d find that resource dependence had as much potential for building an expansive theoretical program as institutional theory did. You could imagine that resource dependence could have expanded its conceptual artillery to embrace resource dependencies of various types (e.g., cultural resources, symbolic resources) and across different sources of dependence (e.g., state, professions, consumers).  Resource dependence could have co-opted the burgeoning literature on interorganizational networks and provided it with a theoretical lens with which its fancy methods could be put to use.  (It’s always seemed strange to me that Ron Burt’s structural holes concept was not more tightly associated with resource dependence theory given that one of the central concepts in his theory, structural constraint, is all about dependence.) The theory could have branched out to explain phenomena as varied as firms’ symbolic responses to shareholder activism or the influence of  corporate board networks on patterns of diffusion. These studies happened and some were informed by Pfeffer and Salancik, but they were not closely associated with resource dependence theory. Instead, many of these studies ran to institutional theory for cover.

I think there are a number of reasons resource dependence theory failed to cohere into a community of scholars. Here are a few:

• Pfeffer and Salancik (1978) offered a broad “ecological” theory about how firms were situated in and depended on their environment, but the empirical application of the theory became too narrow too soon.  Although P&S emphasized in their original formulations that organizational managers could respond to dependencies in a number of ways, including symbolic responses, research seemed to settle on absorption as the most common/effective response. Dependence absorption essentially means that the organization seeks to eliminate the source of its dependence through co-optation, merger, acquisition, etc. Thus, many of the most famous resource dependence studies are about acquisition or merger patterns across industries. While absorption is certainly a common response, resource dependence scholars’ fascination with it may have unintentionally diverted scholars from exploring a diversity of ways in which firms manage dependence relations. The theory narrowed its focus too quickly.
• While resource dependence theory narrowed its focus, institutional theory became expansive. Institutional theorists cast a wide net. They were open to scholars who were interested in one of their central concepts, even if their intention was completely orthogonal to the original motivations of institutional theory (e.g., Oliver 1991). This open tent approach allowed institutional theory to evolve fairly quickly from an explanation for the rationalization of the organization to a broader theory about the macro-cultural environment of organizations. The flexibility of institutional theory made it attractive to management scholars who were looking for non-economic explanations for organizational phenomena. Because institutional theory was seen as more flexible, it became a formidable competitor to resource dependence theory in management scholarship, which would increasingly become the hot bed for influence building in organizational theory.
• Population ecologists created a better methodological toolkit than resource dependence scholars.  In reading my grad school notes on Pfeffer and Salancik (1978) I’m amazed at how similar some of their central assumptions about organizational survival were to their ecologist colleagues. Both the ecologists and resource dependence theorists imagined a world in which organizational survival was less a function of managerial talent or knowledge and more a consequence of an organization’s fit with its resource environment.  The advantage Hannan and Freeman had over P&S, in my view, is that they offered the complete theory-method package. They not only provided a way to conceptualize the resource environment of organizations, they also gave you a toolkit for operationalizing and analyzing that environment. As a result, population ecology became the go-to theory for explaining organizational survival/failure.
• Resource dependence lacked the community builders its competitors had.  I don’t know very much about Pfeffer’s and Salancik’s efforts to promote the theory or to create a cadre of resource dependence followers, but I do know that their competitors were especially good at this (although they did it in different ways). Hannan and Freeman created a community of scholars through intense training of their graduate students, who continued to publish together over the years and formed an cohesive community of scholars who would develop and test the basic ideas of the theory. Institutional theorists did this as well, but they also held numerous conferences, published edited volumes, and made ties to other communities of like-minded scholars. Their community building has paid off big time for both theories, especially as it affects citation patterns and ability to get through the peer review process.   Salancik, of course, passed away in 1996. Pfeffer’s interests moved to other areas of research.  The loss of these figureheads of the theory, I think, has hurt the theory’s prominence in the field. Not having active promoters of the community has probably meant that there were fewer opportunities for resource dependence scholars to engage in community building.
• Dick Scott.  As the key chronicler of organizational theory Dick has had huge sway over people’s tastes and research interests. Dick is by no means an enemy to resource dependence theory, but he is a great friend to institutional theory. His book, Institutions and Organizations, has made him an ambassador of institutional theory.  Moreover, his three pillars approach to institutional theory was so encompassing that it pushed institutional scholars to move even further into the territory of P&S (a trend that DiMaggio and Powell started when making the case for coercive isomorphism). Absorption of uncertainty was recast as a strategic response to institutional pressures.  At the time that Dick wrote his influential book, resource dependence theorists had few proponents willing to defend the captured territory.

Regardless of the reason, resource dependence theory is basically dead as a theoretical program. Again, I think it will continue to be cited and will inspire insights and interpretations, but as an active research program it’s time is gone. That may not be a bad thing. In a future post maybe I’ll write more about why I think that building big theoretical programs might be counterproductive, but for now I’ll just say that I think resource dependence theory gives us a window into understanding what makes a theoretical program successful. It’s not all about the ideas because Pfeffer and Salancik had a LOT of them. Theories compete for attention and resources in the same way organizations do. From what we know about resource dependence theory, at some point during the 1980s resource dependence theory lost its ability to compete for those resources with population ecology and institutional theory.

*Jerry Davis and Adam Cobb wrote a nice review piece about resource dependence theory for Research in the Sociology of Organizations in which they provide evidence of the theory’s “ongoing influence across a number of social science fields.” I’m not saying it’s no longer influential (as can been by the continued citations Pfeffer and Salancik get), but I do think that there isn’t much evidence that has cohered into a community of researchers in the same way that institutional theory or population ecology has. Because of that, I don’t think Pfeffer and Salancik get credit for the novelty of their ideas.