In this Chapter, we address the challenge of explaining institutional change, asking whether the much-criticized rational choice perspective can contribute to the understanding of institutional change in political science. We discuss the methodological reasons why rational choice institutionalism (RCI) often assumes that institutional change is exogenous and discontinuous. We then identify and explore the possible pathways along which RCI can be extended to be more useful in understanding institutional change in political science. Finally, we reflect on (...) what RCI theorizing would look like if it started to take endogenous change seriously: by giving up some of its simplifying assumptions, RCI can be a useful tool for analyzing institutional change, but choosing this path has consequences for the generality of the models in RCI as well as for the style of its theorizing. (shrink)

Our economic system, the market economy, is a part of a broader system or “society.” We frequently study the operation of the market economy as if it were autonomous, even though there are many complex and mutual relationships between society, the economic system and the other systems – political, cultural, religious, legal, etc. – that form part of society. In a market economy we may identify several components: a frame or background in which the economic activity takes place, a set (...) of ideas and theories, the values shared by this society, the set of institutions, norms and rules that control the economic behavior of people, and the incentives or motivations of the economic agents. The play of these elements defines the operation of a market economy. Is ethics an institution, or does it belong to the set of values and ideas? In this paper I will discuss the role of institutions, norms and rules in society, with special reference to the economic system, in order to gain insight into the relationship between institutions and ethics. I study first the concept and features of social institutions and norms; second, institutional change, and third, the relationship between ethics and institutions. (shrink)

My intention in this text is to present the most significant contribution of some French philosophers and anthropologists to the notion of reconstruction and advancement of institutions. The paradox of change, reform or transformation of the institution – is an entirely new institution possible? How do institutions die? – lies in the difficulty or even impossibility to change something that manifests what we are as a group. If institutions really present or represent the relations among all of us, how can (...) they be changed in the first place? Whence the capacity for change? What allows for the idea of the “new”? (shrink)

This book analyses the evolution of the French model of capitalism in relation to the instability of socio-political compromises. In the 2010s, France was in a situation of systemic crisis, namely, the impossibility for political leadership to find a strategy of institutional change, or more generally a model of capitalism, that could gather sufficient social and political support. This book analyses the various attempts at reforming the French model since the 1980s, when the left tried briefly to orient the (...) French political economy in a social-democratic/socialist direction before changing course and opting for a more orthodox macroeconomic and structural policy direction. The attempts of governments of the right to implement a radically neo-liberal structural policy also failed in the face of a significant social opposition. The enduring French systemic crisis is the expression of contradictions between the economic policies implemented by the successive left and right governments, and the existence of a dominant, social bloc, that is, a coalition of social groups that would politically support the dominant political strategy. Since 1978, both the right and the left have failed to find a solution to the contradictions between the policies they implemented and the expectations of their respective social bases, which are themselves inhabited by tensions and contradictions that evolve with the structural reforms that gradually transformed French capitalism. (shrink)

Since the 1980s scholars have been increasingly confronted with expectations to orient themselves toward societal and economic priorities. This normative demand for societal responsiveness is inscribed in discourses aimed at increasing the usefulness, competitiveness, and control of academia. New performance criteria, funding conditions, and organizational forms are central drivers of this debate – thereby, they change the conditions in which scholars conduct research and advance their careers. However, little is known so far about the impact these institutional changes (...) have on the habitus of academics. This article analyzes how stable and consistent habitus formations among academics turn out to be in the course of institutional changes. We compare the habitus formations of two generations of German scholars before and after institutional changes gained pace in Germany. Three distinct habitus formations can be identified, which we refer to as “self-fulfilling,” “self-surpassing,” and “self-asserting.” These habitus formations hold across the two generations, but the lines between them become blurry in the new generation. (shrink)

Formal, informal and material institutions constitute the framework for human interaction and communicative practice. Three ideas from institutional theory are particularly relevant to technical change. Exclusion cost refers to the effort that must be expended to prevent others from usurping or interfering in one’s use or disposal of a given good or resource. Alienability refers to the ability to tangibly extricate a good or resource from one setting, making it available for exchange relations. Rivalry refers to the degree and (...) character of compatibility in various uses for goods. The paper closes with a note on how attention to these factors might be useful ways to conceptualize what Langdon Winner has called “the technological constitution of society,” and what Andrew Feenberg has theorized as “secondary rationalization,” as well as within more practical contexts of technical research, development and design. (shrink)

The role of the state has occupied centre stage in the development of economics as an independent discipline and is one of the most contentious issues addressed by contemporary economists and political economists. The immediate post-war years saw a swing in economic theory towards interventionism, motivated by the urgent need for reconstruction in advanced capitalist countries, the establishment of socialism in parts of Asia and Eastern Europe, and the liberation of many developing nations from colonialism. After a quarter of a (...) century of interventionist policies, a vigourous backlash against state intervention began with the discrediting of welfare statism in advanced capitalist countries, grew through the spread of liberalisation programmes among developing nations during the 1980s, and culminated in the dismantling of socialist central planning since 1989. In this volume, ten distinguished contributors examine patterns of interventionism and anit-interventionism in a wide variety of historical, political and institutional contexts and within different theoretical traditions. Their primary focus is on the internal factors which shape the role of the state and determine its effectiveness in promoting economic change. They explain the growing disenchantment with the Neo-Liberal, anti-interventionist programme--even in Eastern Europe and the former USSR, where the initial optimism in the efficacy of the free market is fading fast. The overall conclusion of the empirical and theoretical analysis is that the simplistic notion of politics fundamental to Neo-Liberal arguments makes them at best misleading and at worst deceitful. Although one can talk of certain general principles, there is no hard and fast rule to determine the optimal degree and the desirable areas of state intervention, which can only be determined in the concrete historical, institutional, and geographical context. The challenge is to form a new synthesis in which the valid insights of Neo-Liberalism are stripped of their ideological baggage and intergrated into a wider and more objective intellectual framework. (shrink)

This book theorizes subversive action, a neglected mechanism in the new institutionalism literature. Subversive action is political in nature, secretly undermining some institutions to open up alternative ideas or to secure existing institutions by secretly undermining adversaries. An example is a politician who promises change in public, but does something else behind the scenes to preserve the status quo. The book addresses the nature and meaning of subversive action and the contexts that give rise to it, as well as how (...) it can work as an important mechanism behind institutional change and continuity. The book will interest students and scholars of public policy, public administration and political science. (shrink)

Bioethics, Volume 36, Issue 3, Page 267-273, March 2022.

Much current work in the social sciences seeks to understand the effects of trust and social capital on economic and political outcomes. However, the sources of trust remain unclear. In this article, the authors articulate a basic theory of the relationship between institutions and trust. The authors apply this theory to industrial districts, geographically concentrated areas of small firm production, which involve extensive cooperation in the production process. Changes in power relations affect patterns of production;the authors suggest that they (...) also have knock-on consequences for trust and cooperation among actors. (shrink)

Central banks have accumulated unparalleled power over the conduct of macroeconomic policy. Key for this development was the articulation and differentiation of monetary policy as a distinct policy domain. While political economists emphasize the foundational institutional changes that enabled this development, recent performativity-studies focus on central bankers’ invention of expectation management techniques. In line with a few other works, this article aims to bring these two aspects together. The key argument is that, over the last few decades, central (...) banks have identified different strategies to assume authority over “expectational politics” and reinforced dominant institutional forces within them. I introduce a comparative scheme to distinguish two different expectational governance regimes. My own empirical investigation focuses on a monetarist regime that emerged from corporatist contexts, where central banks enjoyed “embedded autonomy” and where commercial banks maintained conservative reserve management routines. I further argue that innovations towards inflation targeting took place in countries with non-existent or disintegrating corporatist structures and where central banks turned to finance to establish a different version of expectation coordination. A widespread adoption of this “financialized” expectational governance has been made possible by broader processes of institutional convergence that were supported by central bankers themselves. (shrink)

Formal, informal and material institutions constitute the framework for human interaction and communicative practice. Three ideas from institutional theory are particularly relevant to technical change. Exclusion cost refers to the effort that must be expended to prevent others from usurping or interfering in one’s use or disposal of a given good or resource. Alienability refers to the ability to tangibly extricate a good or resource from one setting, making it available for exchange relations. Rivalry refers to the degree and (...) character of compatibility in various uses for goods. The paper closes with a note on how attention to these factors might be useful ways toconceptualize what Langdon Winner has called “the technological constitution of society,” and what Andrew Feenberg has theorized as “secondary rationalization,” as well as within more practical contexts of technical research, development and design. (shrink)

Although companies recognize the importance of social responsibility and community engagement, conflicts between companies and communities have been noticeably increasing. To better understand the role of institutional environments in company–community conflicts, we analyze two mining conflicts—Minera Yanacocha's Minas Conga extension project in Peru and Minera Los Pelambres' El Mauro Tailings Dam in Chile. Our findings imply that, to prevent negative consequences and alleviate company–community conflicts, mining companies should address underlying structural causes and pursue informal approaches in order to obtain (...) and maintain their social license. We find that better formal institutional environments not only alleviate conflict intensity but also facilitate informal approaches through which companies and communities can cooperate to resolve conflicts. The best practice would be to start and continue dialogs between communities and companies, mediated by impartial governments, to understand the concerns of the counterparty and find means by which to address the causes. (shrink)

The main objective of this essay is to show that the process of transition from socialism to capitalism in Central and Eastern Europe is a cultural problem rather than a technical one. In pursuing that objective I analyze two interrelated issues. First, analysis shows why and how cultural differences in Central and Eastern Europe have, via transaction costs specific to the process of transition, specific and predictable effects on the results of institutional restructuring, and, consequently, on economic performance. Second, (...) I argue that spontaneous changes in the prevailing culture could, under a set of credible and stable formal rules of the game, help to close a gap between the culture supportive of capitalism and the prevailing culture in Central and Eastern Europe. a Footnotesa My colleague and friend Fred Fransen made two major contributions to this essay: he helped me identify numerous inconsistencies in the essay, and he changed a number of my perceptions on the relationship between culture and economic performance. James Buchanan, Ljubo Madzar, Henry Manne, Milic Milovanovic, and Katarina Ott gave me useful suggestions and comments on earlier drafts. I am grateful to Victor Vanberg and Ulrich Witt for the opportunity to discuss this essay with their colleagues and students at the University of Freiburg and Max Planck Institute in Jena, Germany. (shrink)

The notion of entrepreneurship developed by Israel Kirzner has applications far beyond the market process. Legal entrepreneurs are lawyers, activists, and other participants in the legal process who are alert to opportunities to alter legal rules, thereby benefiting themselves or their clients. Legal entrepreneurship creates a dynamic that can generate virtually continuous change in the structure of legal rights and duties. On the one hand, the notion of legal entrepreneurship is a testament to the value of Kirzner’s project. But on (...) the other, it creates a serious problem for Kirzner’s conception of welfare economics, which depends on the existence of a stable background of property rights. If the notion of entrepreneurship implies continual change in property rights, then the power of Kirznerian welfare economics is substantially curtailed.La notion d’esprit d’entreprise développée par Israel Kirzner a des applications qui vont bien au-delà du processus de marché. Les entrepreneurs juridiques sont les avocats, les activistes et autres participants au processus juridique qui ont conscience des opportunités de transformer les règles de droit, que ce soit pour leur propre bénéfice ou pour celui de leurs clients. L’entrepreneuriat juridique crée une dynamique qui peut générer des changements presque continus dans la structure des droits légaux et des devoirs. D’une part, la notion d’entrepreneuriat juridique est un témoignage de la valeur du projet de Kirzner. Mais d’autre part, il crée un sérieux problème quant à sa conception de l’économie du bien-être de Kirzner qui repose sur l’existence d’une structure stable de droits de propriété. Si la notion d’esprit d’entreprise implique un changement continuel dans les droits de propriété, alors la portée de l’économie du bienêtre de Kirzner est substantiellement réduite. (shrink)

Tema ovog rada je afera iz 2001. godine u vezi sa finansijskim transakcijama izmedju Srbije i Kipra tokom devedesetih. U radu se analiziraju strategije koje politicari, drzavni sluzbenici i strucnjaci u oblasti borbe protiv korupcije primenjuju kako bi kroz javne debate odbranili svoje interese. Rezultati ukazuju da se vecina ucesnika opredeljuje za jedno od sledeca dva nacina: javno objavljivanje informacija o aferi kako bi se stekla legitimnost za anti-korupcijsko delovanje, ili koordinisano izbegavanje rasprava o aferi kako bi se umanjila moguca (...) politicka steta. (shrink)

Under the influence of groundbreaking work by John Meyer and Brian Rowen, as well as Paul DiMaggio and Walter Powell, over the last 30 years research in the new sociological institutionalism has focused on processes of isomorphism. I argue that this is a one-sided focus that leaves out many insights from other institutional and macrosociological approaches and does not do justice to actual social change because it overlooks the role played by divergent institutional development. While the suggestion of (...) divergent trends is not new, there have been few attempts to integrate divergence into the theoretical premises of the new sociological institutionalism. Based on the typology proposed by DiMaggio and Powell, I show that the mechanisms identified by them as sources of isomorphic change can support processes of divergent change as well. The theoretical challenge is to identify conditions under which these mechanisms push institutional change toward homogenization or divergence. (shrink)

This book seeks to explain long-term economic development and institutional change in terms of the cognitive features of human learning and communication processes. Martens links individual cognitive processes to macroeconomic growth theories, including economies of scale and scope, and to theories of institutional development based on asymmetric information in production processes and economies of scale in enforcement technology. With considerable flair, Bertin Martens has applied the hot new area of psychological and behavioural economics to notions of growth and (...) development and has created a unique and impressive volume. (shrink)

The focus of this paper is institutional change and the changing role of business in Germany. Back in the 1980s, the German institutional framework was characterized by implicit mandatory and obligatory regulations that set a clear context for responsible corporate behavior. Today, this framework has eroded and given way to a situation in which corporations explicitly and voluntarily take responsibility for social issues. This shift from implicit to explicit corporate social responsibility is an indication of a major (...) class='Hi'>institutional change epitomized by the deconstruction of ‘old’ and the reconstruction of ‘new’ institutions. In the course of this change, corporations, state actors, and civil society organizations compete for their ideas and interests in what we call a fight for myths. The paper traces this fight for myths and the changing understanding of corporate responsibility in Germany. (shrink)

This longitudinal case study identifies corporate governance responses in a Chinese state-owned enterprise facing institutional logic multiplicity and demands to shoulder sociopolitical responsibilities beyond economic responsibility. We find that overseas listing led to the incorporation of market logic into an enterprise in which party-state logic prevailed. The prioritization of sociopolitical responsibilities vis-à-vis economic responsibility has shifted through three phases, reflecting changes in institutional logic centrality amid changing politico-institutional and firm conditions. In response, the enterprise developed hybrid (...) corporate governance structures based first on decoupling (2001–2011) and then on translation of a “foreign” corporate governance model to fit the domestic context (2012–2016) but has since sought to dehybridize by strengthening the state-controlled governance structure (2017–2019). Our study contributes to the varieties-of-capitalism approach to corporate governance and offers perspectives on institutional change, institutional logic, and hybrid organizing as well as the implicit ethical issue. (shrink)

We aggregate different dimensions of corporate social responsibility (CSR) activities following the stakeholder framework proposed in Clarkson (Acad Manag Rev 20(1), 92–117, 1995) and present consistent evidence that CSR strengths targeting different stakeholders have their unique impact on firm risk and financial performance. Institutional CSR activities that target secondary stakeholders are negatively associated with firm risk, measured by total risk and systematic risk. Technical CSR that target primary stakeholders are positively associated with firm financial performance, measured by Tobin’s Q, (...) ROA, and cash flow returns. Our results, based on a sample of S&P 500 component firms over the period of 1995–2009, are consistent with the risk management view of “altruistic” CSR activities and with the stakeholder salience theory. We also show that the impact of CSR activities on risk varies with the ethical climate, as proved in our subsample analyses on pre- and post-Sarbanes–Oxley periods. Our empirical analyses mitigate possible omitted variables and endogeneity concerns that are often overlooked in previous research. Our findings are robust to alternative CSR measures, to alternative risk and performance measures, and to alternative estimation methods. (shrink)

In 1997, the Japanese Diet revised the Bank of Japan law thereby granting the central bank greater independence in monetary policy making. The revision was an attempt by Japan's political class to weaken the authority of the powerful Ministry of Finance over the central bank and augment its own influence. The Bank of Japan, however, gained more autonomy than politicians ever intended, leading to frequent confrontations between the government and the central bank over monetary policy. This paper explores the new (...) strategic relationship that emerged between the Bank of Japan and government and the nature of monetary policy implemented in the post-reform period. We demonstrate that several factors contributed to the Bank's unexpected ability to enhance its independence: the astute leadership of the first post-reform governor Hayami Masaru; the Bank's ability to turn politicization of monetary policy to its advantage; and its pursuit of a strategy achieved by augmenting its own research capacity. On a theoretical level, our findings show that the passage of a new legal framework only marks the completion of one stage of institutional change and the start of the next; post-enactment politics have as much importance as pre-enactment politics in shaping outcomes. In the post-enactment phase, various factors, including the state of the economy and informal institutions or processes, matter greatly and may shift the direction of institutional change away from the intended path. (shrink)

As debate continues around the nature and values of education, it is important to ask the question of what factors motivate a student to engage with the ends of an educational institution. In this paper, a broad, holistic view of learner motivation, derived from Aristotelian ethics, is used to provide a model to drive institutional change. Focussing on the approach of one Higher Education institution to the particular accommodations required for students with disabilities, the paper identifies three factors which (...) motivate students, a failure to engage with the aims and ends of the educational project, a failure to see that a particular learning aim is worth attaining, and a simple lack of will‐power to attain it. To each of these failures a social cause is identified, and a change in both the institutional culture and the individual learner's approach to their education is suggested. (shrink)

La littérature sur le sentier de corrélation met en doute l’efficience du mécanisme de marché en ce qui concerne le choix des technologies et des normes caractérisé par les rendements croissants.Récemment cette idée a attiré l’attention de quelques chercheurs spécialisés dans le processus de changement institutionnel. Dans cet article je soutiens qu’il y a de sérieux défauts dans la manière dont le sentier de corrélation des changements technologiques est habituellement présenté. Le point principal est quoi qu’il en soit le changement (...) institutionnel. Ici, je montre que le concept de sentier de corrélation nécessite quelques modifications avant qu’il ne puisse être appliqué fructueusement.The literature of path-dependence casts doubt on the efficiency of the market mechanism concerning the choice of technologies and standards characterized by increasing returns. Recently this idea has aroused interest among scholars inquiring into the process of institutional change. In this article I argue that there are serious shortcomings in the way pathdependence of technological change is usually presented. The main focus is, however on institutional change. Here I show that the concept ot pathdependence needs some modification before it can fruitfully be applied. (shrink)

Previous studies in Western contexts have examined the relationships between various board characteristics and CSR, yet the relationships need to be re-examined in non-Western contexts given differential theoretical premises across contexts. We specifically propose that the effects of board characteristics on CSR in Korea should be patterned distinctively from Western-based existing literature, focusing on three important board characteristics, such as a board’s independence, social ties, and diversity. Using a panel dataset from large Korean firms, we found that various relationships between (...) board characteristics and CSR were non-linear, whereas most of the previous research on Western contexts found that the same relationships were linear. Specifically, curvilinear relationships were found between CSR and board independence, CEO-outside director social ties, and educational diversity. Our findings suggest that there is no universal feature of CSR-supportive board characteristics due to the unique characteristics of various institutional contexts. (shrink)

Scientific progress remains one of the most significant issues in the philosophy of science today. This is not only because of the intrinsic importance of the topic, but also because of its immense difficulty. In what sense exactly does science makes progress, and how is it that scientists are apparently able to achieve it better than people in other realms of human intellectual endeavour? Neither philosophers nor scientists themselves have been able to answer these questions to general satisfaction.

Using data collected through semi-structured open-ended interviews and archival material, we examined the transience of stakeholders’ salience in the organisational field going through institutional change process. We found strong support for the dominant institutional logic-stakeholder salience relationship. More importantly, the results of our study reveal that changes in stakeholders’ salience are directly related to changes in stakeholders’ attributes. Moreover, we uncover mutual associations among various types of salience attributes and show that the degree of mutual association (...) of various types of attributes depends upon the stage the organisation has reached during the process of institutional change. (shrink)

This paper examines cross-national differences in the development of sectoral collective bargaining in the European telecommunications industry following comparable changes in market regulations. The authors seek to explain why centralized, coordinated bargaining institutions were established in Austria and Sweden, both within incumbent telecommunications firms and at the sector level, while Germany and Denmark experienced decentralization and disorganization of bargaining at both levels. The authors argue that these outcomes resulted from differences in institutional loopholes employers were able to exploit (...) to avoid centralized bargaining and past union structures that influenced patterns of interunion cooperation. These two explanatory factors were interrelated: the presence or absence of institutional loopholes affected the basis for cooperation between unions, while labor cooperation was an important power resource unions could draw on to close emerging loopholes. Findings demonstrate the importance of sector-level political dynamics for the construction or erosion of solidaristic bargaining structures under pressure from market liberalization. (shrink)

This paper investigates the effect of female representation on the board of directors on corporate response to stakeholders’ demands for increased public reporting about climate change-related risks. We rely on the Carbon Disclosure Project as a sustainability initiative supported by institutional investors. Greenhouse gas emissions measurement and its disclosure to investors can be thought of as a first step toward addressing climate change issues and reducing the firm’s carbon footprint. Based on a sample of publicly listed Canadian firms over (...) the period 2008–2014, we find that the likelihood of voluntary climate change disclosure increases with women percentage on boards. We also find evidence that supports critical mass theory with regard to board gender diversity. These findings reinforce initiatives being undertaken around the world to promote gender diversity in corporate governance while demonstrating board effectiveness in stakeholder management. (shrink)

The aim of this paper is to present a comparative analysis and reconstruction of the approach to social, moral, and institutional change in the theories of Adam Smith and Sophie de Grouchy. In their theories moral philosophy is inextricably linked with social thought. I also discuss the role of education and institutions in such a process. I argue that Smith's and de Grouchy's understanding of the roles of sympathy and institutions are strictly connected to the way they perceive the (...) process of social change. Both philosophers considered people as equals and equally capable of sympathizing with others. For both of them, sympathy is a key element in reconstructing how societies change. In my opinion, both these philosophers believe that such a change can be induced: in the case of de Grouchy, this would be done primarily by legislators. In the case of Smith, respected people are capable of initiating change and are subsequently followed by others. (shrink)

The liberal international order is being challenged today by populism and unilateralism. Though it has been resilient in the past, the current challenges from within the order are unprecedented. Without being too pessimistic, I expect the LIO will survive but retract to its original core states in North America, Europe, and Northeast Asia, shedding some of its universal pretensions. States that remain within the liberal order, in turn, will compete with an alternative Chinese-led international hierarchy built around all or part (...) of the current Belt and Road Initiative countries. While international institutions can facilitate cooperation, they do not bridge this emerging divide sufficiently to forestall conflict and, in any event, will not be sufficiently robust to prevent a new cold war. As part of the roundtable “International Institutions and Peaceful Change,” this brief essay sketches this argument and concludes with some possible ways of moderating future conflicts. (shrink)

Colin Hay’s and Vivien Schmidt’s responses to my previous critical engagement with their respective versions of neo-institutionalism raise the issue of how scholars may account for the ideational power of political processes and how ideas may generate both stability and change. Even though Hay, Schmidt, and I share a common philosophical ground in many respects, we nevertheless diverge in our views about how to account for ideational power and for actors’ ability to navigate a social reality that is saturated with (...) structures and meaning. There continues to be a need for an analytical framework that incorporates discourse and a constitutive logic based upon the power in ideas. Post-structural institutionalism (PSI) analyzes discourse as knowledge claims by means of the concept of a constitutive causality, analytically identified in respect to institutions, such that the substantive content of ideas/discourse provides ideational power and generates immanent change. (shrink)