Introduction: Institutions in the Making: Identity, Power, and the Emergence of New Organizational Forms

Abstract

Thirty years ago, new institutional theory challenged the then dominant functionalist explanations of organizational behavior by pointing to the role of meaning in the production and reproduction of organizational practices (Meyer & Rowan, 1977; Meyer & Scott, 1983). But new institutional theory was soon subject to both internal and external criticism for having, among other things, replaced the invisible hand of the market with the invisible hand of culture. In effect, it was difficult for the theory to explain how institutions change and develop in different directions because actors were subjugated to institutions (Powell & DiMaggio, 1991). The result was an oversocialized conception of humanity, in Wrong’s (1961) terms, in which institutions shaped all behavior and, thus, seemed to arise and evolve on their own accord. The criticism has led to various attempts to introduce a theory of action compatible with the main precepts of the new institutionalism (Scott, 1994). One approach has been to argue for a rational actor in a constructed world (e.g., DiMaggio, 1988). A second approach has been to combine the theory of organizations with the theory of individuals by developing a middle-range theory of how processes of interest articulation and organizational decision making have been institutionalized (e.g., Fligstein, 1996). A third approach has been to develop a constructionist view in which actors themselves are historically created and variable, with different notions of self, of identity, and of connection to the group over time (e.g., Meyer, Boli, & Thomas, 1987).