Journal ArticleDOI
Who appropriates centrality rents? The role of institutions in regulating social networks in the global Islamic finance industry
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TLDR
In this article, the authors studied the effects of country-level institutions on the distribution of centrality rents between two sets of actors in an interorganizational network, and found that a cohesive elite following organizational logics other than profit-maximization diverts centrality rent and induces costs on firms.Abstract:
This study explains and tests the effects of country-level institutions on the distribution of centrality rents between two sets of actors in an interorganizational network. Building on the literature on corporate elites, we propose that a cohesive elite following organizational logics other than profit-maximization diverts centrality rents and induces costs on firms, and that macro institutions act as external governance mechanisms to shape this relationship. We develop our theory in the emerging Islamic finance industry, where “Shariah scholars” connect firms and constitute a religious corporate elite. While central scholars in this network create legitimacy for firms, they also shirk and cause information leakage, suggesting a negative centrality-performance relationship for the firms. Country-level institutions such as government regulation and democracy, we argue, ameliorate these effects by influencing this religious elite’s institutional logic and restraining their actions, while institutions developed from within the industry strengthen the power of the elite. Testing our theory in a network of 367 scholars and 396 institutions over 31 countries using multi-level methods, we indeed find a negative centrality-performance relationship that is ameliorated by stronger government regulation but exacerbated by better-developed industry-specific institutions, as well as a negative relationship between democratic and regulatory institutions and centrality.read more
Citations
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The iron cage revisited: Institutional isomorphism and collective rationality in organizational fields (Chinese Translation)
Paul DiMaggio,Walter W. Powell +1 more
TL;DR: In this article, the authors argue that rational actors make their organizations increasingly similar as they try to change them, and describe three isomorphic processes-coercive, mimetic, and normative.
International business responses to institutional voids
TL;DR: A review and synthesis of existing research on institutional voids, tracking the evolution of institutional void scholarship since the inception of the concept, can be found in this article, where the authors highlight four different strategies for responding to them: internalization, substitution, borrowing and signaling.
Journal ArticleDOI
Making connections: Social networks in international business
TL;DR: In this article, the authors provide a brief overview of network research in the IB domain to give a sense of some of the major ongoing themes and to illustrate how the social network approach can provide fresh insights and add substantive value to the field.
Journal ArticleDOI
The trade-off between knowledge accumulation and independence: The case of the Shariah supervisory board within the Shariah governance and firm performance nexus
TL;DR: In this article, the authors examined the impact of the trade-off between knowledge accumulation and independence on the Shariah governance-firm performance nexus through a detailed examination of Shariah supervisory board tenure.
Journal ArticleDOI
The holding behavior of Shariah financial assets within the global Islamic financial sector: A macroeconomic and firm-based model
Seng Kiong Kok,Stefano Filomeni +1 more
TL;DR: In this paper, the authors examined the dynamics influencing the holding behavior of Shariah assets by Islamic financial institutions and found that economic wealth, market liquidity and the institutional board size are robust and positive linear predictors of IFI Shariah asset holding behavior.
References
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Journal ArticleDOI
Theory of the firm: Managerial behavior, agency costs and ownership structure
TL;DR: In this article, the authors draw on recent progress in the theory of property rights, agency, and finance to develop a theory of ownership structure for the firm, which casts new light on and has implications for a variety of issues in the professional and popular literature.
Book ChapterDOI
The iron cage revisited institutional isomorphism and collective rationality in organizational fields
Paul DiMaggio,Walter W. Powell +1 more
TL;DR: In this paper, the authors argue that rational actors make their organizations increasingly similar as they try to change them, and describe three isomorphic processes-coercive, mimetic, and normative.
Book
Econometric Analysis of Cross Section and Panel Data
TL;DR: This is the essential companion to Jeffrey Wooldridge's widely-used graduate text Econometric Analysis of Cross Section and Panel Data (MIT Press, 2001).
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Institutions, Institutional Change and Economic Performance
TL;DR: Douglass C. North as discussed by the authors developed an analytical framework for explaining the ways in which institutions and institutional change affect the performance of economies, both at a given time and over time.
Posted Content
Institutions, Institutional Change, and Economic Performance
Douglass C. North,John Alt +1 more
TL;DR: In this article, the authors examine the role that institutions, defined as the humanly devised constraints that shape human interaction, play in economic performance and how those institutions change and how a model of dynamic institutions explains the differential performance of economies through time.
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