Abstract
This investigation will discuss the emergence of an economistical perspective among the dominant approaches of organization theory in the United States since the inception of “organization studies” as an academic discipline. It maintains that Contingency theory, Resource Dependency theory, Population Ecology theory, and Transaction Cost theory analyze predominantly for-profit organizations within the context of the current economic environment. It further holds that the political and cultural environments, as well as the role of communities, are widely neglected by the economistical perspective. The New Institutionalism departs from this line of thinking and offers an implicit critique. With this focus, this article addresses a sociology of knowledge theme and aims to account for this theoretical limitation by drawing on social developments in the American economy, in American politics, and in the academy. Finally, this study argues that the economization of organization studies is strongly supported by the increasing proliferation of American business schools. Here the science of organization studies has found its new institutional home.
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Notes
Therefore, the term “economistical” neither implies that the theories became more practically oriented, nor does it refer to the dominance of micro-economic approaches (another topic of growing importance) within organization studies.
For example, to cite to other prominent figures at that time: In an empirical study of a coal mine in Lakeport, Alvin Gouldner (1954) demonstrated how bureaucratic structures and hierarchies could be circumvented by employees through the use of informal rules, a commitment to specific values, and through the binding power of loyalties. Amitai Etzioni (1961), focusing upon the conditions under which people obey authority relations, developed a typology corresponding to the reasons why people in organizations do what they are told to do (see also Blau and Scott 2003; Burnham 1941).
For a detailed discussion of the economistic perspective held by the four approaches, see (Senge 2005).
All of these exceptions are taken from one field of research within this approach, namely “organizational founding.” This field of inquiry was deeply influenced by Arthur Stinchcombe and his essay mentioned at the beginning of this paper, “Social Structure and Organizations” (1965). Here he separates a number of founding conditions analyzed in the studies cited above. The other main fields of research are “density dependence,” “special and generalized organizations,” and “community studies,” and they also do not study a variety of social influences. Instead, they are marked by a focus on the resource environment.
“Non-economic institutions of economic action” should be understood in terms of Max Weber’s sociology. Weber provided what is probably the clearest portrayal of the extent to which economic processes are influenced by a series of causal factors, initially described as “non-economic.” In his analyses of economic processes, Weber considered a number of interwoven dimensions and processes: processes of historical change; the power of everyday customs and traditions; the action patterns of various carriers of values, norms and interests; the origins and progress of political events; and the influence of religion, law, and rulership. These “non-economic” factors affect the economy, i.e. they are, strictly, also economic factors. However, they can be analytically separated from factors which are first and foremost of relevance only to the economy, such as prices, remuneration, resources, products and the like. These factors—according to the view represented here—are of course also “non-economically” embedded (i.e. prices are set by the market in differentiated societies, but the actual setting is also influenced by political interventions, and it must be in tune with the normative ideas of appropriateness held by the desired exchange clientele etc.) (see Weber 1978: 63–211, 311–355; on Weber’s multicausality see Kalberg 1994).
This department was not founded but renamed. The former name was the Sloan School of Industrial Administration. The change of name indicates a conscious change of identity.
For illustration: The “Organization and Management Theory” section of the AoM is four times as large as the section of the American Sociological Association (ASA) “Organizations, Occupations, and Work”. In 2004 the section was only three times as large.
Some authors, such as March and Thompson, were important for both disciplines.
This discussion acknowledges that the differences do not apply to all institutions to the same extent. Furthermore, it may very well be that basic research leads to the solution of practical problems and that applied science increases and promotes our knowledge of fundamental problems and questions. Moreover, Leslie and Slaughter argue that differences between universities and professional schools are decreasing in the US. For both, they argue, there is a tendency toward the growing importance of applied science, which they explain by referring to the introduction of market structures into the educational sector (Slaughter and Leslie 1997: 44 ff., 180 ff.). In general, in their book “Academic Capitalism” they argue that academic facilities operate more and more under the aegis of economic rationalities.
This abtraction does not imply that there is no diversity of New Institutionalism and that some authors might stand close to Population Ecology and Resource Dependence theory (see Senge 2005). Since its inception, of course, there has been some positivist thinking in the New Institutionalism (see Hasselbladh and Kallinikos 2000; Kallinikos and Hasselbladh 2009).
The more problem driven character of organizational research is also positively supported to the influence of private philantropic foundations who in the Cold War era supported social science research to improve the management of large organizations. This development, although it “brought good news for business schools in the way of resources for expansion, also carries the seeds of less-welcomed changes in the form of increasing influence within the schools by outside actors” (Khurana 2007: 198).
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This paper benefited from comments und support from Jürgen Beyer, Michael Hartmann, Alfred Kieser, and from the reviewers of The American Sociologist. I am deeply grateful to Stephen Kalberg for his support throughout the publication process.
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Senge, K. The ‘New Institutionalism’ in Organization Theory: Bringing Society and Culture Back In. Am Soc 44, 76–95 (2013). https://doi.org/10.1007/s12108-012-9170-5
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DOI: https://doi.org/10.1007/s12108-012-9170-5