Skip to main content

Advertisement

Log in

Overcoming path dependency: path generation in open systems

  • Published:
Theory and Society Aims and scope Submit manuscript

Abstract

Studies on societal path dependencies tend to focus on mechanisms that anchor and stabilize national trajectories while paying less attention to transnational interactions and multilevel governance. This paper explores processes of path transformation in societies that are presumed to have the characteristics of open systems. Two pairs of case studies are presented and compared. The first illustrates institutional change through collision, when a national path meets with another. The second describes the emergence of transnational institutional paths and the impact of that process on national institutions and their (potential) transformation. The results indicate that path transformation often stems from a gradual succession and combination of incremental steps and junctures – change is gradual but consequential. They also point to increasing co-evolutionary interaction between national path transformation and transnational path creation. This implies a need for analytical tools that are adapted to the analysis of multi-level, nested processes of institutionalization and de-institutionalization. The paper suggests that the concept of path generation allows for a better specification of the conditions for change in existing societal paths and for the emergence of new paths in the case of open systems than the concept of path dependency.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Subscribe and save

Springer+ Basic
EUR 32.99 /Month
  • Get 10 units per month
  • Download Article/Chapter or Ebook
  • 1 Unit = 1 Article or 1 Chapter
  • Cancel anytime
Subscribe now

Buy Now

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Similar content being viewed by others

Notes

  1. A special law concerned with the regulation of the banking sector (Kreditwesengesetz (KWG)), was enacted in July 1961. It indicated the conditions under which banks would be allowed to operate but did not touch upon questions of competition in this sector (Hausleutner 1970: 137ff.).

References

  • Amable, B. (2003). The diversity of modern capitalism. Oxford: Oxford University Press.

    Google Scholar 

  • Aoki, M. (2001). Toward a comparative institutional analysis. Cambridge, MA: MIT Press.

    Google Scholar 

  • Arthur, W. B. (1989). Competing technologies, increasing returns and lock-in by historical events. Economic Journal, 99, 116–131.

    Article  Google Scholar 

  • Ballwieser, W. (Ed.) (1998). US-Amerikanische Rechnungslegung. Grundlagen und Vergleiche mit dem deutschen Recht. Stuttgart: Schäffer-Poeschel.

  • Berger, P. L., & Luckmann, T. (1967). The social construction of reality. A treatise in the sociology of knowledge. New York: Doubleday.

    Google Scholar 

  • Berghahn, V. (1986). The Americanization of West German industry. Cambridge: Cambridge University Press.

    Google Scholar 

  • Beyer, J. (1998). Managerherrschaft in Deutschland? “Corporate Governance” unter Verflechtungsbedingungen. Opladen: Westdeutscher Verlag.

    Google Scholar 

  • Beyer, J. (2006). Pfadabhängigkeit ist nicht gleich Pfadabhängigkeit! Wider den impliziten Konservatismus eines gängigen Konzepts. Zeitschrift für Soziologie, 34(1), 5–21.

    Google Scholar 

  • Botzem, S. (forthcoming). Transnational expert-driven standardization – accountancy governance from a professional point of view. In J.-C. Graz & A. Nölke (Eds.), Transnational Private Governance and its Limits. London: Routldege

  • Botzem, S., & Quack, S. (2006). Contested rules and shifting boundaries: International standard setting in accounting. In M.-L. Djelic & K. Sahlin-Andersson (Eds.), Transnational governance: Institutional dynamics of regulation. Cambridge: Cambridge University Press.

    Google Scholar 

  • Brunsson, N., & Jacobsson, B. (Eds.) (2000). A world of standards. Oxford: Oxford University Press.

  • Campbell, J. L. (2004). Institutional change and globalization. Princeton, NJ: Princeton University Press.

    Google Scholar 

  • Campbell, J. L., & Pederson, O. K. (Eds.) (1996). Legacies of change. Transformation of postcommunist European economies. New York: Aldine de Gruyter.

  • Clemens, E., & Cook, J. (1999). Politics and institutionalism: Explaining durability and change. Annual Review of Sociology, 25, 244–266.

    Article  Google Scholar 

  • Commission of the European Communities (1995). Competition policy in the new trade order: Strengthening international co-operation and rules. (Van Miert Report). Brussels: EU Commission.

  • Crouch, C. (2005a). Capitalist diversity and change. Recombinant governance and institutional entrepreneurs. Oxford: Oxford University Press.

    Google Scholar 

  • Crouch, C. (2005b). Complementarity and fit in the study of comparative capitalisms. In G. Morgan, R. Whitley, & E. Moen (Eds.), Changing capitalisms? Internationalization, institutional change, and systems of economic organization. Oxford: Oxford University Press.

    Google Scholar 

  • Crouch, C., & Farrell, H. (2002). Breaking the path of institutional development? Alternatives to the new determinism. Discussion Paper 02/5. Cologne: Max Planck Institute for the Study of Societies.

  • Daley, L. A., & Mueller, G. G. (1982). Accounting in the arena of world politics. Crosscurrents of international standard-setting activities. Journal of Accountancy, February, 40–50.

  • Damm, W. (1958). National and international factors influencing cartel legislation in Germany. PhD Dissertation, University of Chicago.

  • David, P. A. (1985). Clio and the economics of QWERTY. American Economic Review, 75, 332–337.

    Google Scholar 

  • Deeg, R. (2001). Institutional change and the uses and limits of path dependency: The case of German finance. Discussion Paper 01/6. Cologne: Max Planck Institute for the study of societies.

  • Deeg, R. (2005). Change from within: German and Italian finance in the 1990s. In K. Thelen & W. Streeck (Eds.), Beyond continuity: Institutional change in advanced political economies. Oxford: Oxford University Press.

    Google Scholar 

  • DiMaggio, P. J., & Powell, W. W. (Eds.) (1991). The new institutionalism in organizational analysis. Chicago, IL: The University of Chicago Press.

  • Djelic, M.-L. (1998). Exporting the American model. Oxford: Oxford University Press.

    Google Scholar 

  • Djelic, M.-L. (2002). Does Europe mean Americanization? The case of competition. Competition and Change, 6(3), 223–250.

    Article  Google Scholar 

  • Djelic, M.-L., & Kleiner, T. (2006). The international competition network: Moving towards transnational governance. In M.-L. Djelic & K. Sahlin-Andersson (Eds.), Transnational governance: Institutional dynamics of regulation. Cambridge: Cambridge University Press.

    Google Scholar 

  • Djelic, M.-L., & Quack, S. (2003a). Globalization and institutions: Redefining the rules of the economic game. Cheltenham: Edward Elgar.

    Google Scholar 

  • Djelic, M.-L., & Quack, S. (2003b). Conclusion: Globalization as a double process of institutional change and institution building. In M.-L. Djelic & S. Quack (Eds.), Globalization and institutions: Redefining the rules of the economic game. Cheltenham: Edward Elgar.

    Google Scholar 

  • Djelic, M.-L., & Quack, S. (2003c). Theoretical building blocks for a research agenda linking globalization and institutions. In M.-L. Djelic & S. Quack (Eds.), Globalization and institutions: Redefining the rules of the economic game. Cheltenham: Edward Elgar.

    Google Scholar 

  • Djelic, M.-L., & Quack, S. (2005). Rethinking path dependency: The crooked path of institutional change in Post-War Germany. In G. Morgan, R. Whitley, & E. Moen (Eds.), Changing capitalism? Internationalization, institutional change, and systems of economic organization. Oxford: Oxford University Press.

    Google Scholar 

  • Djelic, M.-L., & Sahlin-Andersson, K. (Eds.) (2006). Transnational governance: Institutional dynamics of regulation. Cambridge: Cambridge University Press.

  • Douglas, M. (1986). How institutions think. Syracuse, NY: Syracuse University Press.

    Google Scholar 

  • Ebbinghaus, B. (2005). Can path dependence explain institutional change? Two approaches applied to welfare state reform. Discussion Paper 05/2. Cologne: Max Planck Institute for the Study of Societies.

  • Fligstein, N. (1990). The transformation of corporate control. Cambridge, MA: Harvard University Press.

    Google Scholar 

  • Garud, R., & Karnøe, P. (Eds.) (2001). Path dependence and creation. Mahwah: Erlbaum.

  • Haley, J. O. (2001). Antitrust in Germany and Japan: The first fifty years: 1947–1998. Seattle, WA: University of Washington Press.

    Google Scholar 

  • Hall, P., & Soskice, D. (2001). Varieties of capitalism. The institutional foundations of comparative advantage. Oxford: Oxford University Press.

    Google Scholar 

  • Haller, A. (2002). Financial accounting developments in the European Union: Past events and future prospects. The European Accounting Review, 11(1), 153–190.

    Article  Google Scholar 

  • Hanson, S. (1998). Analyzing post-communist economic change: A review essay. East European Politics and Society, 12, 145–170.

    Article  Google Scholar 

  • Hausleutner, J. P. (1970). Die Kartellrechtliche Bereichsausnahme für das Kreditgewerbe und die Fachaufsicht nach dem Kreditwesengesetz. Dissertation, University of Kiel, Germany.

  • Herrigel, G. (1996). Industrial constructions. The sources of German industrial power. Cambridge: Cambridge University Press.

    Google Scholar 

  • Höpner, M., & Krempel, L. (2003). The politics of the German company network. Working Paper 03/9. Cologne: Max Planck Institute for the Study of Societies.

  • Horstmann, T. (1991). Die Alliierten und die deutschen Großbanken. Bankenpolitik nach dem Zweiten Weltkrieg in Westdeutschland. Bonn: Bouvier Verlag.

    Google Scholar 

  • Hüttenberger, P. (1976). Wirtschaftsordnung und Interessenpolitik in der Kartellgesetzgebung der Bundesrepublik. 1949–1957. Vierteljahreshefte für Zeitgeschichte, 24/3, 287–307.

    Google Scholar 

  • ICPAC (International Competition Policy Advisory Committee) (2000). ICPAC Final Report. Retrived October 12, 2006, from http://www.usdoj.gov/atr/icpac/finalreport.htm.

  • Jacoby, W. (2000). Imitation and politics. Ithaca, NY: Cornell University Press.

    Google Scholar 

  • Jalabert-Doury, N. (2003). The international competition network, convergence in merger control? International Business Law Journal, 6, 697–710.

    Google Scholar 

  • Johnson, J. (2001). Path contingency in postcommunist transformations. Comparative Politics, 33(3), 253–274.

    Article  Google Scholar 

  • Kleekämper, H. (1995). Aktuelle Entwicklungen beim IASC. Betriebswirtschaftliche Forschung und Praxis, 4, 414–431.

    Google Scholar 

  • Kleiner, T. (2003). Building up an asset management industry: Forays of an Anglo-Saxon logic into French business system. In M.-L. Djelic & S. Quack (Eds.), Globalization and institutions. Cheltenham: Edward Elgar.

    Google Scholar 

  • Lane, C. (2005). Institutional transformation and system change: Changes in the corporate governance of German corporations. In G. Morgan, R. Whitley, & E. Moen (Eds.), Changing capitalism? Internationalization, institutional change, and systems of economic organization. Oxford: Oxford University Press.

    Google Scholar 

  • Lütz, S. (2002). Der Staat und die Globalisierung von Finanzmärkten: Regulative Politik in Deutschland, Großbritannien und den USA. Frankfurt/Main: Campus.

    Google Scholar 

  • Mahoney, J. (2000). Path dependence in historical sociology. Theory and Society, 29(4), 507–548.

    Article  Google Scholar 

  • March, J. G., & Olsen, J. P. (1998). The institutional dynamics of international political orders. International Organization, 52(4), 943–969.

    Article  Google Scholar 

  • Maurice, M., & Sorge, A. (Eds.) (2000). Embedding organizations. Societal analysis of actors, organizations and socio-economic context. Amsterdam: John Benjamins.

  • Mayntz, R., & Scharpf, F. W. (1995). Der Ansatz des Akteurszentrierten Institutionalismus. In R. Mayntz & F. W. Scharpf (Eds.), Steuerung und Selbstorganisation in staatsnahen Sektoren. Frankfurt: Campus.

    Google Scholar 

  • McNichol, J., & Bensedrine, J. (2003). Multilateral rulemaking: transatlantic struggles around genetically modified food. In M.-L. Djelic & S. Quack (Eds.), Globalization and institutions. Redefining the rules of the economic game. Cheltenham: Edward Elgar.

    Google Scholar 

  • Melamed, D. (2000). Promoting sound antitrust enforcement in the global economy. Speech of the Acting Assistant Attorney General, Antitrust Division, US DOJ, before the Fordham Corporate Law Institute 27th Annual Conference on International Antitrust Law and Policy, New York, October 19. Retrieved from http://www.usdoj.gov/atr/public/speeches/6785.htm.

  • Meyer, J. W., & Rowan, B. (1977). Institutionalized organizations: Formal structure as myth and ceremony. American Journal of Sociology, 83, 340–363.

    Article  Google Scholar 

  • Monti, M. (2002). A global competition policy? Speech by the European Commissioner for Competition at the European Competition Day, Copenhagen, September 17. Retrieved October 12, 2006, from http://europa.eu.int/comm/competition/speeches/ index _speeches_by_the_commissioner.html.

  • Morgan, G., & Kubo, I. (2005). Beyond path dependency? Constructing new models for institutional change: The case of capital markets in Japan. Socio-Economic Review, 3(1), 55–82.

    Article  Google Scholar 

  • Morgan, G., & Quack, S. (2000). Confidence and confidentiality: The social construction of performance standards in banking. In S. Quack, G. Morgan, & R. Whitley (Eds.), National capitalisms, global competition, and economic performance. Amsterdam: John Benjamins.

    Google Scholar 

  • Morgan, G., & Quack, S. (2005). Institutional legacies and firm dynamics: The growth and internationalization of British and German law firms. Organization Studies, 26(12), 1765–1785.

    Google Scholar 

  • Morgan, G., Whitley, R., & Moen, E. (Eds.) (2005). Changing capitalisms? Internationalization, institutional change, and systems of economic organization. Oxford: Oxford University Press.

  • Muris, T. (2002). Competition agencies in a market based global economy. Speech of the Chairman of the Federal Trade Commission at the Annual Lecture of the European Foreign Affairs Review, Brussels, July 23). Retrieved from http://www.ftc.gov/speeches/muris/020723brussels.htm.

  • Murrell, P. (1995). The transition according to Cambridge, Mass. Journal of Economic Literature, 33, 164–178.

    Google Scholar 

  • Nawrocki, J. (1973). Komplott der ehrbaren Konzerne. Marktmanipulation, Wettbewerbsverzerrung, Preisdiktate. Hamburg: Hoffmann und Campe.

    Google Scholar 

  • Nobes, C., & Parker, R. (Eds.) (1985). Comparative international accounting. New York: St. Martin’s Press.

  • North, D. (1990). Institutions, institutional change and economic performance. Cambridge: Cambridge University Press.

    Google Scholar 

  • Padgett, J. (2001). Organizational genesis, identity and control: The transformation of banking in Renaissance Florence. In A. Cassella & J. Rauch (Eds.), Markets and networks. New York: Russell Sage.

    Google Scholar 

  • Pierson, P. (2000). Increasing returns, path dependence, and the study of politics. American Political Science Review, 94, 251–268.

    Article  Google Scholar 

  • Pittman, R. (1998). Competition law and policy in the United States. Working Paper US Department of Justice. Washington, DC.

  • Pons, J.-F. (2002). Is it time for an International Agreement on Antitrust? Speech at “The Future of Transnational Antitrust: From Comparative to Common Competition Law,” organized by the Max Planck Institute for Foreign and International Patent, Copyright, and Competition Law and the University of Munich Institute for International Law, Frauenchiemsee, Germany, June 3–5.

  • Quack, S. (2006). Die transnationalen Ursprünge des,deutschen Kapitalismus. In V. Berghahn & S. Vitols (Eds.), Gibt es einen deutschen Kapitalismus? Frankfurt/Main: Campus.

    Google Scholar 

  • Quack, S., & Djelic, M.-L. (2005). Adaptation, recombination, and reinforcement: The story of antitrust and competition law in Germany and Europe. In W. Streeck & K. Thelen (Eds.), Beyond continuity. Institutional change in advanced political economies. Oxford: Oxford University Press.

    Google Scholar 

  • Robert, R. (1976). Konzentrationspolitik in der Bundesrepublik – Das Beispiel der Entstehung des Gesetzes gegen Wettbewerbsbeschränkungen. Berlin: Duncker & Humblot.

    Google Scholar 

  • Rouam, C., Thinam, J., & Lisbe, S. (1994). La politique de concurrence de la communauté à l’échelle mondiale: l’exportation des règles de concurrence communautaires. EC Competition Policy Newsletter, 1(1), 7–11.

    Google Scholar 

  • Samuels, J. M., & Piper, A. G. (1985). International accounting: A survey. London: Croom Helm.

    Google Scholar 

  • Schaub, A. (2000). Assessing international mergers: The Commission’s approach. Speech of the Director General for Competition, European Commission at the EC Merger Control 10th Anniversary Conference, Brussels, September 14–15. Retrieved October 12, 2006, from http://europa.eu.int/comm/competition/speeches/text/sp2000_015_en.html.

  • Schmidt, H. A. (1995). Die Europäisierung des Kartellrechts im Bereich der Kredit- und Versicherungswirtschaft. Baden-Baden: Nomos.

    Google Scholar 

  • Schneiberg, M. (2007). What’s on the path? Path dependence, organizational diversity and the problem of institutional change in the US economy, 1900–1950. Socio-Economic Review, 5, 47–80.

  • Scholtyseck, J. (2000). Die USA vs. “The Big Six.” Der gescheiterte Bankenprozeß nach dem zweiten Weltkrieg. Bankhistorisches Archiv, 26, 27–53.

    Google Scholar 

  • Schreyögg, G., Sydow, J., & Koch, J. (2003). Organisatiorische Pfade – von der Pfadabhängigkeit zur Pfadkreation? Managementforschung, 13, 257–294.

    Google Scholar 

  • Scott, W. R. (2001). Institutions and organizations (2nd ed.). Thousand Oaks, CA: Sage.

    Google Scholar 

  • Sewell, W. H. (1996). Three temporalities: Toward an eventful sociology. In T. J. McDonald (Ed.), The historic turn in the human sciences. Ann Arbor, MI: University of Michigan Press.

    Google Scholar 

  • Shonfield, A. (1977 [1965]). Modern capitalism. The changing balance of public and private power. Oxford: Oxford University Press.

    Google Scholar 

  • Sorge, A. (2005). The global and the local. Understanding the dialectics of business systems. Oxford: Oxford University Press.

    Google Scholar 

  • Stark, D. (1992). Path dependence and privatization strategies in East Central Europe. East European Politics and Societies, 6(1), 17–54.

    Google Scholar 

  • Stark, D., & Bruszt, L. (1998). Postsocialist pathways. Cambridge: Cambridge University Press.

    Google Scholar 

  • Streeck, W. (1991). On the institutional conditions of diversified quality production. In E. Matzner & W. Streeck (Eds.), Beyond Keynesianism: The socio-economics of production and full employment. Aldershot: Edward Elgar.

    Google Scholar 

  • Streeck, W., & Höpner, M. (2003). Einleitung: Alle Macht dem Markt? In W. Streeck & M. Höpner (Eds.), Alle Macht dem Markt? Fallstudien zur Abwicklung der Deutschland AG. Frankfurt/Main: Campus.

    Google Scholar 

  • Streeck, W., & Thelen, K. (Eds.) (2005a). Beyond continuity – Institutional change in advanced political economies. Oxford: Oxford University Press.

  • Streeck, W., & Thelen, K. (2005b). Introduction: Institutional change in advanced political economies. In W. Streeck & K. Thelen (Eds.) (2005a). Beyond continuity – Institutional change in advanced political economies. Oxford: Oxford University Press.

  • Tamm Hallström, K. (2004). Organizing international standardization. ISO and the IASC in quest of authority. Cheltenham: Edward Elgar.

    Google Scholar 

  • Thelen, K. (2003). How institutions evolve. Insights from comparative historical analysis. In J. Mahoney & D. Rueschemeyer (Eds.), Comparative historical analysis in the social sciences. Cambridge: Cambridge University Press.

    Google Scholar 

  • Thelen, K. (2004). How institutions evolve. The political economy of skills in Germany, Britain, the United States and Japan. Cambridge: Cambridge University Press.

    Google Scholar 

  • Thorell, P., & Whittington, G. (1994). The harmonization of accounting within the EU. Problems, perspectives and strategies. European Accounting Review, 3/2, 215–239.

    Google Scholar 

  • Tolbert, P. S., & Zucker, L. G. (1996). The institutionalization of institutional theory. In S. R. Clegg, C. Hardy, & W. R. Nord (Eds.), Handbook of organization studies. London: Sage.

    Google Scholar 

  • Van Miert, K. (1997). International cooperation in the field of competition. A view from the EC. Speech by the European Commissioner before the Fordham Corporate Law Institute 24th Annual Conference. New York, October 16. Retrieved October 12, 2006, from http://europa.eu.int/comm/competition/speeches/text/sp1997_073_en.html.

  • Vitols, S. (2001). The origins of bank-based and market-based financial systems: Germany, Japan, and the United States. Discussion Paper FS I 01–302, Berlin: Social Science Research Center Berlin.

  • Vorwold, G. (2000). Das Modell “FASB” in den USA – Ein Fehlschlag. Internationales Steuerrecht, 19, 599–607.

    Google Scholar 

  • Weir, M. (1992). Politics and jobs: The boundaries of employment policy in the United States. Princeton, NJ: Princeton University Press.

    Google Scholar 

  • Westney, D. E. (1987). Imitation and innovation. The transfer of Western organizational patterns to Meiji Japan. Cambridge, MA: Harvard University Press.

    Google Scholar 

  • Whitley, R. (1999). Divergent Capitalisms. Oxford: Oxford University Press.

    Google Scholar 

  • Windolf, P., & Beyer, J. (1995). Unternehmensverflechtung im internationalen Vergleich. Kölner Zeitschrift für Soziologie und Sozialpsychologie, 47(1), 1–36.

    Google Scholar 

  • WTO (2000). Report of the working group on the interaction between trade and competition policy to the General Council. Retrieved from http://docsonline.wto.org/imrd/.

  • Zeiler, T. (1999). Free trade, free world: The advent of GATT. Chapel Hill, NC: University of North Carolina Press.

    Google Scholar 

Download references

Acknowledgments

We thank Suzyon Wandrey for her careful language editing of the manuscript. We also thank the reviewers and Editors at Theory and Society for highly helpful comments and suggestions that made it possible to improve the article.

Author information

Authors and Affiliations

Authors

Corresponding author

Correspondence to Marie-Laure Djelic.

Rights and permissions

Reprints and permissions

About this article

Cite this article

Djelic, ML., Quack, S. Overcoming path dependency: path generation in open systems. Theor Soc 36, 161–186 (2007). https://doi.org/10.1007/s11186-007-9026-0

Download citation

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s11186-007-9026-0

Keywords

Navigation