Abstract
The aim of this paper is twofold: firstly to discuss the foundations of Grid-Group “Cultural Theory” and highlight the compatibility with Austrian economics, and secondly to apply this framework to the context of organisational culture. My claim is that “Corporate Cultural Theory” provides a rigorous and grounded social anthropological framework to take Austrian economics beyond its traditional uses and improve upon competing explanations of corporate culture.
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Notes
Although this paper intends to be compatible with previous treatments, and does not contradict previous uses, the natural ambiguity over terms means that it is a modified version of the theory.
For the purposes of this article I ignore the four cultural types that are the logical outcome of having a 2x2 matrix, to focus on the underlying axes.
In Douglas’ initial presentation of grid-group positive group means the self is dominated by group control, whilst negative group means the individual exerts pressure over the group. In this article I follow the later versions of the theory, where strong group means strong allegiance, and weak group means weak allegiance. The midpoint remains. Hendry (1999) outlines the ambiguity with how Cultural Theory has been expressed diagrammatically. Pp.561–562
Typically this external agency is the state. To the extent that the issue of contractual consent is relevant, we are effectively viewing the corporation as the central contracting authority (see Agassi 1960:265).
See Boulding (1966). However I don’t wish to assert that I am the first person to make this point. For example, Denison and Mishra (1995) provide a criticism of using a positivist methodology to study corporate culture, and call for more phenomenological work. However my claim for novelty lies in my proposed solution, which is the use of forms of analytic narratives associated with the Austrian school of economics.
“The validity [of Cultural Theory] is not to be judged by the statistician’s correlation coefficients and t-tsets, but by the degree to which it accords with people’sexperience” Adams 1995.
Indeed this position mirrors Ludwig Lachmann’s capital theory: if one can’t measure something, we should classify it
Consequently we can reject even the most famous cultural analyses—such as Hofstede (1980)—for being unsatisfactory on the grounds that they are quantitatively driven (and therefore fail to truly capture cultural conditions); and are based on national data (towards methodological holism).
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Previous versions of this paper have been presented at the “Conference on Austrian Market-based Approaches to the Theory and Operation of a Business Firm”, George Mason Law School (May 2007); and the “Workshop on Cultural Theory and Management: A Conference held in memory of Prof. Dame Mary Douglas”, ESCP-EAP London (July 2007). The usual disclaimer applies.
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Evans, A.J. Balancing corporate culture: Grid-group and Austrian economics. Rev Austrian Econ 26, 297–309 (2013). https://doi.org/10.1007/s11138-013-0233-9
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DOI: https://doi.org/10.1007/s11138-013-0233-9
Keywords
- Corporate culture
- Cultural theory
- Institutions
JEL Codes
- B53
- L22
- M14
- Z13