The Evolution of Modern Institutions and Organizations
Posted: 24 May 2011
Date Written: May 23, 2011
Cultural evolution has historically concentrated on questions of the long term evolution of human culture and on questions of gene-culture co-evolution. However, cultural evolution is a dynamic process that very much operates in recent and ongoing change in human societies. Over the last two centuries, most of the world has been in the midst of an ongoing process often called modernization. Cultural evolutionists conjecture that the transformation of social networks caused by mass mobility is a basic driver of modernization. Networks become less kin dense as people move from traditional villages to towns and cities. As a consequence, support for the family as an institution weakened and competing institutions, such as business firms, attracted more support. Gradually, individual rights come to trump family duties in the legal and ethical domains. Lesley Newson and I tested this hypothesis at the national scale by examining the relationship of many variables to years since the demographic transition began, a good index of the beginning of modernization. A goodly fraction of the contemporary cultural variation in the world appears to be attributable to stage of the country in the modernizing process. In ongoing work, Christian Cordes, Georg Schwesinger, and I have developed models of firms based on the idea that work values transmitted within firms are an important determinant of firm behavior. In small entrepreneurial firms, the founding leaders of the organization play an important role socializing workers. If these firms grow, these individuals’ influence is diluted and firms face growth crises that can be resolved by developing more formalized management systems or by the spin-off of new entrepreneurial firms. The business environment determines which path an evolving industry takes. The models reflect stylized facts about industry evolution described by students of business organizations.
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