Sociology Institutions
by
Fabio Rojas
  • LAST MODIFIED: 26 August 2013
  • DOI: 10.1093/obo/9780199756384-0132

Introduction

Sociologists have long noticed that communal life is often orderly. This observation motivates the idea of “institution.” One definition is that institutions are stable patterns of behavior that define, govern, and constrain action. Another definition is that an institution is an organization or other formal social structure that governs a field of action. Sociologists have a long-standing interest in institutions because they wish to explain social order. The earliest discussion of institutions, dating to the early 20th century, focuses on micro-level interactions with a community or a single organization. In the 1960s and 1970s there was a shift to studying how institutions produce order on a national or global scale. Theoretically, institutions are rules that connect an individual or organization to a larger social environment. Work in the 21st century has moved away from institutions as purely constraining forces. Scholars are interested in how individuals create institutions, or how institutions erode and thus lose their power or otherwise change.

General Overviews

Institutional analysis is a popular area of research that attracts attention from scholars in sociology, management, and political science. A number of books and surveys have been written that survey this ever-growing literature. In general, these books are authored by leading scholars and provide a synthesis, overview, and critique of various strands of institutional research. Some texts, such as Scott 2008, are monographs that provide a thorough account of this area, while others are anthologies that collect highly influential articles and provide contextualizing introductory essays. DiMaggio and Powell 1991; Scott and Meyer 1994; Brinton and Nee 1998; and Greenwood, et al. 2008 each give summaries of the main ideas of institutional research as it existed at the time. Clemens and Cook 1999 focuses on the relationship to political science.

  • Brinton, Mary C., and Victor Nee. 1998. The new institutionalism in sociology. Stanford, CA: Stanford Univ. Press.

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    Explores how institutions may be viewed as rules that emerge from individual decisions that reflect cost-benefit calculations. Thus, institutional theory may have a basis in rational choice theory.

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    • Clemens, Elisabeth, and James Cook. 1999. Politics and institutionalism: Explaining durability and change. Annual Review of Sociology 25:441–466.

      DOI: 10.1146/annurev.soc.25.1.441Save Citation »Export Citation »E-mail Citation »

      An overview of work up to the late 1990s, this review article raises a fundamental question: if institutions are made up of rules or norms that constrain behavior, then how does social change occur according to institutional theory? This essay focuses on the processes that might disrupt institutions.

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      • DiMaggio, Paul J., and Walter W. Powell, eds. 1991. The new institutionalism in organizational analysis. Chicago: Univ. of Chicago Press.

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        Collects most of the important articles that defined new institutional theory in the 1970s and 1980s. The introductory essay by DiMaggio and Powell and a commissioned essay by Freidland and Alford have become influential as well. There are two sections, one is on theory and the other on empirical applications.

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        • Greenwood, Royston, Christine Oliver, Kerstin Sahlin, and Roy Suddaby. 2008. The SAGE handbook of organizational institutionalism. Thousand Oaks, CA: SAGE.

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          Provides an overview and selection of institutional theory as it has been developed and applied in sociology and management.

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          • Scott, W. Richard, and John W. Meyer. 1994. Institutional environments and organizations: Structural complexity and individualism. Thousand Oaks, CA: SAGE.

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            Explains how institutions define an organization’s environment. This book is also notable because it contains the original analysis of schools that motivated Meyer and Rowan’s argument about loose coupling of organizations and environments.

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            • Scott, W. Scott. 2008. Institutions and organizations. Thousand Oaks, CA: SAGE.

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              Functions as both a textbook on organizational sociology and a survey of institutional theory. This book is the most comprehensive monograph on this topic and covers a wide range of topics.

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              Old Institutionalism

              Institutionalism in sociology has two periods. An earlier “old institutionalism” focuses on how organizations are influenced by local interests. The “new institutionalism” focuses more on how organizations respond to global cultural forces. The old institutionalism usually dates from the beginning of modern sociology. For example, Sumner 1907 and Michels 1962 draw attention to the power of local constituencies and their ability to co-opt organizations, a theme elaborated in Zald and Denton 1963. The new institutional theory is said to have started with Stinchcombe 1965 (cited under New Institutionalism), which argued that organizations are “imprinted” by their environment. Prior to that, institutional analysis focused on the push and pull between organizational leaders and their constituents, stockholders, and customers. Case studies of co-optation and an organization’s link with the local community dominate this literature: Gouldner 1954, Dalton 1959, and Selznick 1966 are all case studies of organizations, and Parsons 1956 and Merton 1957 are significant theoretical statements. Stinchcombe 1997 argues that his work actually reflects the influence of this older institutionalism.

              • Dalton, Mellville. 1959. Men who manage. New York: Wiley.

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                Study of a chemical plant that focuses on the vast differences between the formal structure of the firm versus the network of cliques inside the firm.

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                • Gouldner, Alvin. 1954. Patterns of industrial bureaucracy. Glencoe, IL: Free Press.

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                  A case study of a mining strike. Gouldner explores how authority was created and destroyed through personal relations between workers and managers.

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                  • Merton, Robert J. 1957. Bureaucratic structure and personality. In Social theory and social structure. Edited by Robert Merton, 196–206. Glencoe, IL: Free Press.

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                    Describes how managers abandon goals and adaptability in order to “overconform” to the bureaucracy.

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                    • Michels, Robert. 1962. Political parties: A sociological study of the oligarchical tendencies of modern Democracy. New York: Collier.

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                      Originally published in 1911. Classic text arguing that political organizations tend to be co-opted by small, powerful cliques of elites.

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                      • Parsons, Talcott. 1956. Suggestions for a sociological approach to the theory of organizations-I. Administrative Science Quarterly 1:63–85.

                        DOI: 10.2307/2390840Save Citation »Export Citation »E-mail Citation »

                        Offers an abstract formulation of the organization that is both technical (task oriented) an institutional (socially oriented).

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                        • Selznick, Philip. 1966. TVA and the grass roots: A study in the sociology of formal organization. New York: Harper and Row.

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                          A classic analysis of a government agency known as the Tennessee Valley Authority. Theoretically, the book is well known for describing goal displacement as government bureaucrats responded to local constituents and abandoned their own goals.

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                          • Stinchcombe, Arthur. 1997. On the virtues of the old institutionalism. Annual Review of Sociology 23:1–18.

                            DOI: 10.1146/annurev.soc.23.1.1Save Citation »Export Citation »E-mail Citation »

                            An overview of the work of Arthur Stinchcombe, this article argues that legitimacy is a flexible concept and that what is legitimate is strongly shaped by context and circumstance. Thus, Stinchcombe’s work stands in contrast to newer varieties of institutionalism.

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                            • Sumner, William Graham. 1907. Folkways: A study of the sociological importance of usages, manners, customs, mores, and morals. Cambridge, MA: Atheneum.

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                              An early textbook of cultural sociology that makes a key institutional argument. Specifically, Sumner argues that new policies may be resisted if they do not conform to local custom.

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                              • Zald, Mayer N., and Denton, Patricia. 1963. From evangelism to general service: The transformation of the YMCA.” Administrative Science Quarterly 8:214–234.

                                DOI: 10.2307/2390900Save Citation »Export Citation »E-mail Citation »

                                Case study of the YMCA showing how the religious mission of the YMCA was eventually replaced by the concerns of urban activists who wanted to focus more on poverty and education.

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                                New Institutionalism

                                Starting in the late 1960s, sociologists became less interested in an organization’s co-optation by local actors. Instead, they began to focus on the larger social environment: the state, public opinion, influential professional groups, and regulatory agencies. Theoretically, organizational sociologists defined the “new institutional” theory by the attention given to the environment. Stinchcombe 1965 is considered the beginning of this literature. There is a great emphasis in works such as Weick 1976 and Meyer and Rowan 1977 on weak links between organizations and environments. Others such as Zucker 1977, DiMaggio and Powell 1983, and Fligstein 1990 focus on strong organizational/environmental links. Pfeffer and Salancick 1978 is considered the standard discussion of organizational/environmental links.

                                • DiMaggio, Paul and Walter W. Powell. 1983. The iron cage revisited: Institutional isomorphism and collective rationality in organizational fields. American Sociological Review 52:147–160.

                                  DOI: 10.2307/2095101Save Citation »Export Citation »E-mail Citation »

                                  Introduces the idea of “isomorphism,” which is the similarity within a population of organizations. DiMaggio and Powell claim that organizations (e.g., schools) look the same because they are exposed to the same social environment.

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                                  • Fligstein, Neil. 1990. The transformation of corporate control. Cambridge, MA: Harvard Univ. Press.

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                                    Uses data from the automotive industry to study various mechanisms of normative isomorphism. The key argument is that financial professionals gained power in firms due to the increasing importance of finance.

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                                    • Meyer, John W. and Brian Rowan. 1977. Institutionalized organizations: Formal structure as myth and ceremony.” American Journal of Sociology 83:340–363.

                                      DOI: 10.1086/226550Save Citation »Export Citation »E-mail Citation »

                                      Meyer and Rowan introduce the idea of “myth and ceremony” (pp. 340–341). Organizations enact practices to make it appear as if they conform to social expectation so they have the freedom to act in other ways.

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                                      • Pfeffer, Jeffrey, and Gerald R. Salancick. 1978. The external control of organizations: A resource dependence perspective. New York: Harper and Row.

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                                        An argument that has become very influential among new institutional scholars. The behavior of organizations is determined by their need to acquire resources from external actors. Thus, organizations and environments are strongly linked.

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                                        • Stinchcombe, Arthur. 1965. Social structure and organizations. In The handbook of organizations. By James G. March, 142–193. Chicago: Rand McNally.

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                                          Highly influential article that describes how organizations are “imprinted” by their environment. Since organizations requires approval from elites and the public, they “match” social expectations.

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                                          • Weick, Karl. 1976. Educational organizations as loosely coupled systems. Administrative Science Quarterly 12:1–19.

                                            DOI: 10.2307/2391875Save Citation »Export Citation »E-mail Citation »

                                            Makes the argument that schools are organizations where different activities have little relation to each other. By compartmentalizing activities, schools are able to withstand turbulence from the environment.

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                                            • Zucker, Lynne G. 1977. The role of institutionalization in cultural persistence. American Sociological Review 42:726–743.

                                              DOI: 10.2307/2094862Save Citation »Export Citation »E-mail Citation »

                                              Uses experimental evidence to show how patterns of behavior persist over time.

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                                              World Polity Theory

                                              Institutional theory has found applications in many fields. Perhaps the most notable is the application to political science. According to world polity theory, the nation-states of the world form a community, and each nation-state experiences the pressure to conform with others. The result is that certain cultural practices such as democracy spread throughout the world. This idea has also been applied to science. World polity scholars focus on the international adoption of science as an example of this process. Meyer 1980 and Risse, et al. 1999 take this perspective and build upon early arguments made by new institutional scholars who argue that organizations are susceptible to normative pressures. Meyer, et al. 1997 and Boli and Thomas 1997 expand on these earlier observations in discussing the specific elements of global culture that may spread through international social pressures. Applications to the realm of science (such as Drori, et al. 2003) education (see Meyer and Schofer 2005), and human rights (e.g., Simmons, et al. 2008 and Simmons 2009), appear later.

                                              • Boli, John, and George M. Thomas. 1997. World culture in the world polity. American Sociological Review 62:171–190.

                                                DOI: 10.2307/2657298Save Citation »Export Citation »E-mail Citation »

                                                Introduces the idea of a global or world culture that constrains individual states.

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                                                • Drori, Gili S., John W. Meyer, Francisco O. Ramirez, and Evan Schofer. 2003. Science in the modern world polity: Institutionalization and globalization. Stanford, CA: Stanford Univ. Press.

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                                                  Argues that science is an important element of globalization. Traces the spread of science throughout the world.

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                                                  • Meyer, John W. 1980. The world polity and the authority of the nation-state. In Studies of the modern world-system. Edited by Albert Bergesen, 109–137. New York: Academic Press.

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                                                    An early statement of the world polity perspective that situates the authority and sovereignty of states in a larger system.

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                                                    • Meyer, John W., John Boli, George M. Thomas, and Francisco O. Ramirez. 1997. World society and the nation-state. American Journal of Sociology 103:144–181.

                                                      DOI: 10.1086/231174Save Citation »Export Citation »E-mail Citation »

                                                      Further explains how the emergence of a global community facilitates the spread of forms of government.

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                                                      • Risse, Thomas, Stephen C. Ropp, and Kathryn Sikkink, eds. 1999. The power of human rights: International norms and domestic change. Cambridge, UK: Cambridge Univ. Press.

                                                        DOI: 10.1017/CBO9780511598777Save Citation »Export Citation »E-mail Citation »

                                                        Argues that global norms influence the degree to which states protect human rights.

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                                                        • Schofer, Evan, and John W. Meyer. 2005. The world-wide expansion of higher education in the twentieth century. American Sociological Review 70:898–920.

                                                          DOI: 10.1177/000312240507000602Save Citation »Export Citation »E-mail Citation »

                                                          Examines the rise of post-secondary education in light of globalization.

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                                                          • Simmons, Beth A., Geoffrey Garrett, and Frank Dobbin. 2008. The global diffusion of markets and democracy. Cambridge, UK: Cambridge Univ. Press.

                                                            DOI: 10.1017/CBO9780511755941Save Citation »Export Citation »E-mail Citation »

                                                            Collects influential articles on the spread of policies in world society.

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                                                            • Simmons, Beth A. 2009. Mobilizing for human rights: International law in domestic politics. Cambridge, UK: Cambridge Univ. Press.

                                                              DOI: 10.1017/CBO9780511811340Save Citation »Export Citation »E-mail Citation »

                                                              Argues that even repressive nation-states liberalize when they are subject to the system of international human rights treaties.

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                                                              Conflict, Social Movements, and Institutionalization

                                                              An important development in institutional theory is a new focus on conflict and social change. Rather than assume that individuals and organizations rigidly conform to social expectations, scholars now study how people dispute the rules and fight for new rules. Much of this literature is political in nature and draws from political science and social movement research. Davis and Thompson 1994 views organizational change as a contentious process. Later articles depict political or economic change in terms of challenging or creating institutions. Clemens 1997 describes the rise of political interest groups in this way. Lounsbury 2001, Binder 2002, and Rojas 2007 discuss academic reform, while Bartley 2007 discusses regulation of industry. Schneiberg and Soule 2005 summarizes much of this literature with a multilevel model of change that is initiated by movements but enacted by the state and other powerful actors. Armstrong and Bernstein 2008 addresses the issue of multiple fields, in addition to the state, and how movements may target these fields other than the state. Fligstein and McAdam 2012 rearticulates a theory of fields that emphasizes conflicts between incumbents and challengers. Padgett and Powell 2012 discusses a network-based approach to field emergence.

                                                              • Armstrong, Elizabeth, and Mary Bernstein. 2008. Culture, power, and institutions: A multi-institutional politics approach to social movements. Sociological Theory 26.1: 74–99.

                                                                DOI: 10.1111/j.1467-9558.2008.00319.xSave Citation »Export Citation »E-mail Citation »

                                                                Argues for an alternative to state-centered theories of social movements. Instead, social movements operate in an environment of overlapping fields.

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                                                                • Bartley, Tim. 2007. Institutional emergence in an era of globalization: The rise of transnational private regulation of labor and environmental conditions. American Journal of Sociology 113:297–351.

                                                                  DOI: 10.1086/518871Save Citation »Export Citation »E-mail Citation »

                                                                  Compares two theories of how industry regulations emerge. In one theory, firms impose regulations to protect their reputations. In contrast, regulations may be introduced in response to movement activists. Analyzing the history of apparel manufacturing, the author supports the second hypothesis.

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                                                                  • Binder, Amy. 2002. Contentious curricula: Afrocentrism and creationism in American public schools. Princeton, NJ: Princeton Univ. Press.

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                                                                    Explains the success of a social movement in terms of how well their demands fit with an organization’s culture. The author uses school reform movements as an example and makes the point that if progressive activists suggest something that can be compatible with what teachers believe, then that is the proper way to teach.

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                                                                    • Clemens, Elisabeth. 1997. The people’s lobby: Organizational innovation and the rise of interest group politics in the United States, 1890–1925. Chicago: Univ. of Chicago Press.

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                                                                      A seminal study of how the modern lobbying system emerged from the 19th-century party system. This book is seen as an important case study of the emergence of political institutions.

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                                                                      • Davis, Gerald and Tracy Thompson. 1994. A social movement perspective on corporate control. Administrative Science Quarterly 39:141–173.

                                                                        DOI: 10.2307/2393497Save Citation »Export Citation »E-mail Citation »

                                                                        Uses the analytic tools of social movement theory to explain how actors within firms increase their power. This is the first major article since the 1970s to directly merge social movement theory with organization theory and institutionalism.

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                                                                        • Fligstein, Neil, and Doug McAdam. 2012. A theory of fields. New York: Oxford Univ. Press.

                                                                          DOI: 10.1093/acprof:oso/9780199859948.001.0001Save Citation »Export Citation »E-mail Citation »

                                                                          Presents a theory of society that combines insights from the study of social movements and contention with institutional theory. The key insight is that society is built from overlapping social domains (fields) where change occurs through mobilization.

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                                                                          • Lounsbury, Michael. 2001. Institutional sources of practice variation: Staffing college and university recycling programs. Administrative Science Quarterly 46:29–56.

                                                                            DOI: 10.2307/2667124Save Citation »Export Citation »E-mail Citation »

                                                                            Uses the example of campus recycling programs to focus on how the creation of institutions depends on local staff.

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                                                                            • Padgett, John, and Walter W. Powell. 2012. The emergence of organizations and markets. Princeton, NJ: Princeton Univ. Press.

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                                                                              Offers an analysis of where certain organizational forms come from, rather than why they spread, which is the typical question of institutional theory. The authors use varied historical examples from the Renaissance and other eras.

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                                                                              • Rojas, Fabio. 2007. From black power to black studies: How a radical social movement became an academic discipline. Baltimore: Johns Hopkins Univ. Press.

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                                                                                Asks how social movement actors institutionalize their policy goals. The text is an extended analysis of the black studies movement, which insisted that colleges create programs focusing on black history and culture.

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                                                                                • Schneiberg, Marc, and Sarah Soule. 2005. Institutionalization as a contested, multi-level process: Politics, social movements and rate regulation in American fire insurance. In Social movements and organizations. Edited by Gerald Davis, Doug McAdam, W. Richard Scott, and Mayer Zald, 122–160. Cambridge, UK: Cambridge Univ. Press.

                                                                                  DOI: 10.1017/CBO9780511791000Save Citation »Export Citation »E-mail Citation »

                                                                                  Proposes a model of political change where movements target different “levels” of the political system.

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                                                                                  Institutional Logics and Institutional Work

                                                                                  Another key development in institutional research focuses on the idea that people employ a sort of analytical framework (or a “logic”) that helps them evaluate the social world and organize it. Conversely, there are people who actively expend effort in building institutions or replacing them with new ones. This is called “institutional work.” Bourdieu 1977 provides the general analytic framework that most scholars in this field employ. DiMaggio 1988 and Fligstein 2001 formalize the idea of actors operating in fields. Thornton and Ocasio 1999 focuses on institutional logics, a topic covered at length in Thornton, et al. 2012. Lawrence and Suddaby 2006 focuses on “institutional work,” with applications of this idea in Hallett 2010 and Rojas 2010 in the field of education. Lawrence, et al. 2010 reviews the literature on institutional work and provides a comprehensive assessment.

                                                                                  • Bourdieu, Pierre. 1977. An outline of a theory of practice. Chicago: Univ. of Chicago Press.

                                                                                    DOI: 10.1017/CBO9780511812507Save Citation »Export Citation »E-mail Citation »

                                                                                    This highly influential book introduced a number of concepts such as “field,” “habitus,” and “practice” that remain a staple of institutional discourse and theory.

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                                                                                    • DiMaggio, P. J. 1988. Interest and agency in institutional theory. In Institutional patterns and organizations. Edited by Lynn Zuker, 3–22. Cambridge, MA: Ballinger.

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                                                                                      Introduces the idea that some people consciously act to modify or create new rules and norms for behavior. This is an attempt to bring agency into institutional theory.

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                                                                                      • Fligstein, Neil. 2001. Social skill and the theory of fields. Sociological Theory 19.2: 105–125.

                                                                                        DOI: 10.1111/0735-2751.00132Save Citation »Export Citation »E-mail Citation »

                                                                                        Drawing on DiMaggio and Bourdieu, Fligstein argues that people possess, to varying degrees, the ability to exploit or navigate their social environment.

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                                                                                        • Hallett, Tim. 2010. The myth incarnate: Recoupling processes, turmoil, and inhabited institutions in an urban elementary school. American Sociological Review 75:52–74.

                                                                                          DOI: 10.1177/0003122409357044Save Citation »Export Citation »E-mail Citation »

                                                                                          A critique of institutional theory that depicts people slavishly obeying social norms, this study shows how enforcing rules creates stress and conflict within an urban school. Introduces the idea of “inhabited institutions.”

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                                                                                          • Lawrence, Thomas, and Roy Suddaby. 2006. Institutions and institutional work. In The handbook of organization studies. 2d ed. Edited by Stewart R. Clegg, Cynthia Hardy, Thomas B. Lawrence, and Walter R. Nord, 215–254. London: SAGE.

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                                                                                            Introduces the idea that people actively invest effort to support, change, replace, or erode institutions. Provides a list of different types of institutional work that researchers should investigate.

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                                                                                            • Lawrence, Thomas, Roy Suddaby, and Bernard Leca. 2010. Institutional work: Actors and agency in institutional studies of organizations. Cambridge, UK: Cambridge Univ. Press.

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                                                                                              Brings together a number of new essays on the topic of institutional work, which denotes the effort expended in creating or undermining institutions.

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                                                                                              • Rojas, Fabio. 2010. Power through institutional work: Building academic authority in the 1968 Third World strike. Academy of Management Journal 53:1263–1280.

                                                                                                DOI: 10.5465/AMJ.2010.57317832Save Citation »Export Citation »E-mail Citation »

                                                                                                Argues that social constraints ebb and flow, creating the opportunity for ambitious actors to create power. The case study examines a notorious college strike in 1968.

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                                                                                                • Thornton, Patricia H., and William Ocasio. 1999. Institutional logics and the historical contingency of power in organizations: Executive succession in the higher education publishing industry, 1958–1990. American Journal of Sociology 105:801–843.

                                                                                                  DOI: 10.1086/210361Save Citation »Export Citation »E-mail Citation »

                                                                                                  Uses data on executive succession as evidence that institutionalized rules—those governed by what it thought to be appropriate in the publishing industry—determine who attains leadership in the corporate world.

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                                                                                                  • Thornton, Patricia H., William Ocasio, and Michael Lounsbury. 2012. The institutional logics perspective: A new approach to culture, structure and process. Oxford: Oxford Univ. Press.

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                                                                                                    Provides an overview of research and theory of institutional logics based on the last decade of research in sociology and management.

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                                                                                                    Institutional Theory in Global and Comparative Perspective

                                                                                                    Institutional theory is a global intellectual movement. Analyses of the scholarly corpus of institutional research have shown that American and European scholars differ in the questions they ask and the topics they focus on. For example, Mizruchi and Fein 1999 finds that European scholars are much more likely to focus on coercive processes in organizational fields. Czarniawska 2008 argues that Scandinavian scholars are more likely to focus on social practice and local meaning, as well as technology. Czarniawska and Sevon 2005 provides a thorough treatment of the diffusion of ideas and technology within an institutionalist framework. There is also a strong tradition among European scholars of focusing on historical scholarship that examines cross-national differences in legal and political environments and how that may lead to differences in firm level performance. Djelic 2010 provides an informative review of the divergent streams of American and European institutional scholarship. Tempel and Walgenbach 2007 argues that structuration theory may be a way to bring together competing forms of institutionalism.

                                                                                                    • Czarniawska, Barbara, and Guje Sevón. 2005. Global ideas: How ideas, objects and practices travel in a global economy. Malmö, Sweden: Liber and Copenhagen Business School Press.

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                                                                                                      Addresses the idea of implementation: i.e., how it is that diffusing ideas are translated into specific organizational and economic contexts.

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                                                                                                      • Czarniawska, Barbara. 2008. How to misuse institutions and get away with it: Some reflections on institutional theory(ies). The SAGE handbook of organizational institutionalism. Edited by Royston Greenwood, 769–782. Los Angeles: SAGE.

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                                                                                                        Explores problems within institutional scholarship, such as conflicting definitions, a lack of attention to technology, and the need for narratives that make complex institutional processes intelligible.

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                                                                                                        • Djelic, Marie-Laure. 2010. Institutional perspectives: Working towards coherence or irreconciliable diversity? In The Oxford handbook of comparative institutional analysis. Edited by Glenn Morgan, John Campbell, Colin Crouch, Ove Kaj Pedersen, and Richard Whitley, 15–40. Oxford: Oxford Univ. Press,

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                                                                                                          Notes that institutional scholarship relies on competing models and definitions that appear incompatible. The author argues that this may reflect an underlying diversity to phenomena being studied.

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                                                                                                          • Mizruchi, Mark, and Lisa C. Fein. 1999. The social construction of organizational knowledge: A study of the uses of coercive, mimetic, and normative isomorphism. Administrative Science Quarterly 44:653–683.

                                                                                                            DOI: 10.2307/2667051Save Citation »Export Citation »E-mail Citation »

                                                                                                            A review of twenty-six articles in leading sociology and management journals. Examines how scholars use institutional theory.

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                                                                                                            • Tempel, Anne, and Peter Walgenbach. 2007. Global standardization of organizational forms and management practices? What new institutionalism and the business-systems approach can learn from each other. Journal of Management Studies 44:1–24.

                                                                                                              DOI: 10.1111/j.1467-6486.2006.00644.xSave Citation »Export Citation »E-mail Citation »

                                                                                                              Notes that there are two conflicting versions of institutionalism: one focusing on global uniformity and another, “business systems,” focusing on national regulation regimes. The article invokes Giddens’s theory of structuration as a way of dealing with rival claims.

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                                                                                                              Institutional Theory Outside of Sociology

                                                                                                              Many disciplines use the term “institutionalism,” though not in the same way that sociologists use the term. Economists use the term to denote how incentives shape commercial relationships of various types. Coase 1937 uses this idea to analyze firm boundaries, an idea expanded in Williamson 1981. Hodgson 1988 argues for the more general position that norms and values affect the rules that govern economic exchange. Greif 1993 and Greif 2006 formally model norms from a rational choice perspective and produce a well-known application to the study of medieval trade. Political scientists use the term to denote theories that rely on “path dependency,” the idea that states evolve along a historical trajectory. Moore 1967, Tilly 1984, and Thelen 2004 use this argument in their historical analyses. This section lists a few of the most well-known works that define institutionalism in disciplines other than sociology.

                                                                                                              • Coase, Ronald. 1937. The nature of the firm. Economica 4:386–405.

                                                                                                                DOI: 10.1111/j.1468-0335.1937.tb00002.xSave Citation »Export Citation »E-mail Citation »

                                                                                                                Essay that asks the question of why firms are needed: why is it that business owners do not hire workers as needed? Introduces the idea of transaction costs, which motivates much of modern institutional economics.

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                                                                                                                • Greif, Avner. 1993. Contract enforceability and economic institutions in early trade: The Maghribi traders’ coalition. American Economic Review 83:525–548.

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                                                                                                                  Using data from the history of North African trade, Greif argues that social resources such as trust enabled the formation of stable trade practices.

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                                                                                                                  • Greif, Avner. 2006. Institutions and the path to the modern economy: Lessons from medieval trade. Cambridge, UK: Cambridge Univ. Press.

                                                                                                                    DOI: 10.1017/CBO9780511791307Save Citation »Export Citation »E-mail Citation »

                                                                                                                    An expansion and elaboration of Greif’s initial article on North African trade and the interplay of culture and institutions.

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                                                                                                                    • Hodgson, Geoffrey. 1988. Economics and institutions: A manifesto for a modern institutional economics. Philadelphia: Univ. of Pennsylvania Press.

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                                                                                                                      Argues that economics should seriously consider how social institutions shape or form preferences, a radical departure from prior economic models of human behavior.

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                                                                                                                      • Moore, Barrington. 1967. Social origins of dictatorship and democracy: Lord and peasant in the making of the modern world. Boston: Beacon.

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                                                                                                                        Focuses on the role that peasants and the wealthy classes have on setting nations on a trajectory toward liberal capitalism or dictatorship.

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                                                                                                                        • Thelen, Kathleen. 2004. How institutions evolve: The political economy of skills in Germany, Britain, the United States, and Japan. Cambridge, UK: Cambridge Univ. Press.

                                                                                                                          DOI: 10.1017/CBO9780511790997Save Citation »Export Citation »E-mail Citation »

                                                                                                                          Using the case of job-skills training systems, Thelen explains how this emerges from political settlement between states and business leaders. Also contains influential arguments about how institutions retain continuity in the face of change.

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                                                                                                                          • Tilly, Charles. 1984. Big structures, large processes, huge comparisons. Thousand Oaks, CA: SAGE.

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                                                                                                                            Often invoked by insitutionalists in political science, Tilly views social change as gradual and slow, yet epic.

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                                                                                                                            • Williamson, Oliver E. 1981. The economics of organization: The transaction cost approach. American Journal of Sociology 87:548–577.

                                                                                                                              DOI: 10.1086/227496Save Citation »Export Citation »E-mail Citation »

                                                                                                                              Further develops transaction cost economics as a general framework for explaining firm organization.

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                                                                                                                              Criticisms of Institutional Theory

                                                                                                                              Institutional theory has attracted many critics. Critiques are varied and focus both on theory and empirical validation. Perrow 1986 and Davis 2010 claim that institutional theory is vague. Hirsch 1997, Stinchcombe 1997, Colomy 1998, and Barley 2008 all claim that institutionalism’s theory of human action is implausible. Other critics assert that the theory has little empirical justification or that it has been falsified through hypothesis testing, such as Kraatz and Zajac 1996 and its analysis of liberal arts colleges. See Davis 2010 for a reaffirmation of this point. Yet others such as Rojas 2006 claim that institutional research does not seriously consider alternative hypotheses. Criticisms started to be published in the 1980s and continue into the 21st century.

                                                                                                                              • Barley, Stephen R. 2008. Coalface institutionalism. In The SAGE handbook of organizational institutionalism. Edited by R. Greenwood, C. Oliver, K. Sahlin-Anderson, and R. Suddaby, 491–518. Thousand Oaks, CA: SAGE.

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                                                                                                                                Argues that many of the problems of institutional theory, such as an unconvincing theory of human motivation, might have been avoided if instiutionalists took interactionism more seriously.

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                                                                                                                                • Colomy, Paul. 1998. Neofunctionalism and neoinstitutionalism: Human agency and interest in institutional change. Sociological Forum 13:265–300.

                                                                                                                                  DOI: 10.1023/A:1022193816858Save Citation »Export Citation »E-mail Citation »

                                                                                                                                  Compares neofunctional theory and institutional theory because of their focus on macro-processes at the expense of human agency. Argues for a role for entrepreneurship in institutional theory.

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                                                                                                                                  • Davis, Gerald F. 2010. Do theories of organizations progress? Organizational Research Methods 13:690–709.

                                                                                                                                    DOI: 10.1177/1094428110376995Save Citation »Export Citation »E-mail Citation »

                                                                                                                                    Argues that it is not possible to test many of institutionalism’s claims and that those that have been tested have been convincingly refuted (see Kraatz and Zajac 1996).

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                                                                                                                                    • Hirsch, Paul. 1997. Sociology without social structure: New-institutional theory meets brave new world. American Journal of Sociology 102:1702–1723.

                                                                                                                                      DOI: 10.1086/231132Save Citation »Export Citation »E-mail Citation »

                                                                                                                                      Reviews new institutional theory as it developed up until the 1990s. The author argues that its model of human behavior is highly unreasonable.

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                                                                                                                                      • Kraatz, Matthew, and Edward J. Zajac. 1996. Exploring the limits of new institutionalism: The causes and consequences of illegitimate organizational change. American Sociological Review 61:812–836.

                                                                                                                                        DOI: 10.2307/2096455Save Citation »Export Citation »E-mail Citation »

                                                                                                                                        Claims that new institutional theory is falsified with an analysis of data from liberal arts colleges. The authors find that contrary to institutional theory, liberal arts colleges that deviate from their liberal arts mission to offer vocational degrees are still legitimate.

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                                                                                                                                        • Perrow, Charles. 1986. Complex organizations: A critical essay. New York: McGraw-Hill.

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                                                                                                                                          This overview of organization theory contains a strong criticism of institutional theory, asserting that it is an unrealistic depiction of organizational behavior.

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                                                                                                                                          • Rojas, Fabio. 2006. Sociological imperialism in three theories of the market. Journal of Institutional Economics 2.3: 339–363.

                                                                                                                                            DOI: 10.1017/S1744137406000440Save Citation »Export Citation »E-mail Citation »

                                                                                                                                            In this review of trends in economic sociology, it is claimed that institutionalist scholars ignore relevant evidence from allied disciplines such as economics.

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                                                                                                                                            • Stinchcombe, Arthur. 1997. On the virtues of the old institutionalism. Annual Review of Sociology 23:1–18.

                                                                                                                                              DOI: 10.1146/annurev.soc.23.1.1Save Citation »Export Citation »E-mail Citation »

                                                                                                                                              Argues that due to insistence on isomorphism, new institutional theories are not equipped to explain variance in organizations.

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