Showing papers on "Embeddedness published in 1985"

Economic Action and Social Structure: The Problem of Embeddedness

Abstract: How behavior and institutions are affected by social relations is one of the classic questions of social theory. This paper concerns the extent to which economic action is embedded in structures of social relations, in modern industrial society. Although the usual neoclasical accounts provide an "undersocialized" or atomized-actor explanation of such action, reformist economists who attempt to bring social structure back in do so in the "oversocialized" way criticized by Dennis Wrong. Under-and oversocialized accounts are paradoxically similar in their neglect of ongoing structures of social relations, and a sophisticated account of economic action must consider its embeddedness in such structures. The argument in illustrated by a critique of Oliver Williamson's "markets and hierarchies" research program.

Economic Action and Social Structure: The Problem of Embeddedness

Abstract: The concept of embeddedness has general applicability in the study of economic life and can alter theoretical and empirical approaches to the study of economic behaviors. Argues that in modern industrial societies, most economic action is embedded in structures of social relations. The author challenges the traditional economic theories that have both under- and oversocialized views of the conception of economic action and decisions that merge in their conception of economic actors atomized (separated) from their social context. Social relations are assumed to play on frictional and disruptive, not central, roles in market processes. There is, hence, a place and need for sociology in the study of economic life. Productive analysis of human action requires avoiding the atomization in the extremes of the over- and undersocialized concepts. Economic actors are neither atoms outside a social context nor slavish adherents to social scripts. The markets and hierarchies problem of Oliver Williamson (with a focus on the question of trust and malfeasance) is used to illustrate the use of embeddedness in explicating the proximate causes of patterns of macro-level interest. Answers to the problem of how economic life is not riddled with mistrust and malfeasance are linked to over- and undersocialized conceptions of human nature. The embeddedness argument, on the contrary, stresses the role of concrete personal relations and networks (or structures) in generating trust and discouraging malfeasance in economic life. It finds a middle way between the oversocialized (generalized morality) and undersocialized (impersonal institutional arrangements) approaches. The embeddedness approach opens the way for analysis of the influence of social structures on market behavior, specifically showing how business relations are intertwined with social and personal relations and networks. The approach can easily explain what looks otherwise like irrational behavior. (TNM)

Institutional Economics: Perspectives On Economy and Society

Abstract: How does one explain the kinds of institutions that we find in societies under different conditions? I am referring here to institutions performing economic tasks: allocation of resources, the flow of goods and services, the division of labor, etcetera. My starting points are Karl Polanyi's distinction between market and non-market societies and Douglass North's supplement to Polanyi's argument. I will follow this with sections dealing with the impact of institutions on distributing costs and benefits of economic changes and the relation of economic power to institutions. Polanyi, in his book The Great Transformation, boldly asserts that throughout much of human history the organization of economic activity has relied on various kinds of non-market institutions; according to him, organizing an economy on the market principle began in early nineteenth century Britain with the Corn Laws, ending protection for British agriculture, and the Poor Laws, ending the safety nets of the period and committing the fate of workers to the labor market. However, what concerns me is his typology, his distinction between market .and non-market insti