Bridging Institutional Logics to Lead Regional Development: The Case of Khazanah in Iskandar Malaysia
37 Pages Posted: 27 Mar 2019
Date Written: February 2019
Leading regional development requires bringing diverse industries and actors together to create opportunities, innovation and resilience. However, this diversity increases the potential for conflicts between actors and their institutional logics. We therefore ask: how can actors build a field where diverse logics co-exist and interact to create the potential for innovation, while minimizing the instability coming from conflicts between logics? To answer this question, we study a regional development program piloted by a sovereign development fund (SDF), which attracted US$ 50bn of investments in 6 new industries over 10 years in a region previously ignored by investors. We use tools from network theory to describe the evolution of actors’ position in a region described as an emerging institutional field, and qualitative data from interviews to describe these actors’ reactions to diverse logics. We propose a framework that matches different positions in a network to different strategies to handle logic multiplicity. In addition, we show that the strategy of creating several clusters buffered from each other and previously dominant actors, supports experimentation and innovation. This buffering is positive and enables both innovation and stability and supports regional economic development.
Keywords: Sovereign development fund; Social network centrality; Institutional complexity; Institutional logics
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