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The thick description and comparison of societal systems of capitalism

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Abstract

Critiques of international business theory have recently pointed to weaknesses in the handling of context, of culture, and of policy implications. It is contended that the origins of such failings lie in the discipline's commonly accepted methodologies, and in turn that they have epistemological roots. As a route out of the dilemmas faced, a proposal is made to adopt more complete ways of handling determinacy, including the influences of history, culture, and the societal emergence of institutions. Business systems theory is drawn upon and a model proposed, developed from the work of Whitley. In this, culture is seen as underpinning formal institutions, which in turn underpin societal business systems. The use of the model relies on the ideas of Geertz on ‘thick description’ and of Ragin on holistic analysis. It is illustrated with a comparison of the American and French socio-economic systems, seen historically. Findings in strategy research about the geographically defined nature of firm supremacy in many industries are brought into the account, using the business systems literature. Consistent patterns of determinacy, as well as distinct and contrasting trajectories of business system evolution, are noted. A more complete and multidisciplinary form of explanation, grounded in socio-economics, is advocated as a means of meeting the challenges both of understanding and of policymaking at several levels.

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Notes

  1. The full description of such systems is now the core project of the Euro-Asia and Comparative Research Centre at INSEAD.

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Acknowledgements

The preparation of this paper has been part of a research project funded by the Lee Foundation, to whom grateful thanks are expressed. It has also been greatly helped by the INSEAD Research Committee's support, and by the hospitality of Arie Lewin and the supporters of the JIBS research conference held at Duke University in March 2003. The guidance of Arie Lewin and comments by Max Boisot and Steven White were especially useful, as was the advice of anonymous reviewers. The ideas of Richard Whitley on the concept of business systems remain important foundations. The practical assistance of Nathalie Gonord is gratefully acknowledged.

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Accepted by Arie Lewin, Editor in Chief, 20 September 2004. This paper has been with the author for two revisions.

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Redding, G. The thick description and comparison of societal systems of capitalism. J Int Bus Stud 36, 123–155 (2005). https://doi.org/10.1057/palgrave.jibs.8400129

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