fligstein2007

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property rights are organized, are all regu- ing competitive pressures across multiple
lated by the government. Although producers product markets. If firms decide to produce
attempt to use a variety of strategies to con- multiple products, a downturn in a particular
trol competition, government defines accept- market will not threaten the firm s existence
able modes of relation between producers and because it is not totally resource dependent
regulates competition through reacting to the on the exchange of one product. Population
strategies firms employ. ecology noted this process, describing the
Population ecology, network theory, and diversification tactic as a generalist strategy
institutional theory all recognize that the dif- (Hannan & Freeman 1977). Fligstein (1990)
comes at this process from the point of view
of institutional theory. He shows that prod-
6
Relationships to competitors can be characterized in terms
uct differentiation in U.S. corporations be-
of resource dependence as well. In White s model, when
gan as a marketing strategy in the 1920s that
firms signal their intentions to enter a different part of the
market, they are trying to control their interdependency. was pioneered by large firms to stabilize their
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overall structure. During the Great Depres- how the insurance industry in the nineteenth
sion of the 1930s, the largest corporations century expanded and contracted as regula-
produced as many different kinds of products tors shifted their roles over time. Haveman
as they could to continue to exist in such dis- & Rao (1997) demonstrate similar processes
mal business conditions. operating in the savings and loan industries.
In addition to product differentiation, pro- Fligstein (1990) presents evidence that the
ducers often seek to cooperate and to combine U.S. government played a major role in pre-
with one another to reduce competitive pres- venting the cartelization and monopoliza-
sure. In the old industrial organization litera- tion of American business at the end of the
ture in economics, a small number of firms nineteenth century by using antitrust laws.
dominating a market act to reduce compe- He also demonstrates that the federal gov-
tition in that market. Challenger firms can- ernment played a role in closing down the
not undercut the prices of their larger core 1960s merger movement by aggressively pur-
brethren because the large firms can outlast suing conglomerate mergers. Dobbin (1994)
any competitor in a price war. Podolny (1993), shows how government policies toward rail-
a network theorist, terms this kind of struc- roads early on affected their organization in
ture a status hierarchy. He studies how in- different countries. Dobbin & Dowd (2000)
vestment banks form such a hierarchy that is have documented how government played
primarily held in place by the large size and an important role in railroads in the United
prestige of the biggest banks. These banks States. Campbell & Lindberg (1990) argue
get the largest deals, and they reproduce their that property rights are at the heart of the
place in that structure by being able to under- relationships between governments and firms
cut their competitors if necessary. Fligstein (for a review of the sociological literature on
(1996), in a more institutionalist vein, calls property rights, see Carruthers & Ariovich
this an incumbent-challenger structure. He 2004).
argues that such structures get reproduced as The sociological view of relations among
incumbents use their market power to sus- producers begs the question of who these pro-
tain their advantage in a given market over ducers are and how they make production de-
time. cisions. From the point of view of neoclassical
Although producers may attempt to exert economics, whether producers are individuals
market power through the creation of hier- or organizations matters little; what is impor-
archies, this strategy has its limits. Govern- tant is the production function and the com-
ments regulate competition (Ranger-Moore bination of capital and labor used in the pro-
et al. 1991, Dobbin & Dowd 2000, Fligstein ductive process (Shepard 1970). Conversely, [ Pobierz całość w formacie PDF ]

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