Institutional logic
Encyclopedia
Institutional Logic is a core concept in sociological theory
Sociological theory
In sociology, sociological perspectives, theories, or paradigms are complex theoretical and methodological frameworks used to analyze and explain objects of social study. They facilitate organizing sociological knowledge...

 and organizational studies
Organizational studies
Organizational studies, sometimes known as organizational science, encompass the systematic study and careful application of knowledge about how people act within organizations...

. It focuses on how broader belief systems shape the cognition
Cognition
In science, cognition refers to mental processes. These processes include attention, remembering, producing and understanding language, solving problems, and making decisions. Cognition is studied in various disciplines such as psychology, philosophy, linguistics, and computer science...

 and behavior of actors.

Friedland and Alford (1991) defined Institutions as both supraorganizational patterns of activity by which individuals and organizations produce and reproduce their material subsistence and organize time and space. They are also symbolic systems, ways of ordering reality, thereby rendering experience of time and space meaningful.

Overview

Focusing on macro-societal phenomena, Friedland and Alford (1991: 232) identified several key Institutions: the Capitalist market, bureaucratic state, democracy
Democracy
Democracy is generally defined as a form of government in which all adult citizens have an equal say in the decisions that affect their lives. Ideally, this includes equal participation in the proposal, development and passage of legislation into law...

, nuclear family
Nuclear family
Nuclear family is a term used to define a family group consisting of a father and mother and their children. This is in contrast to the smaller single-parent family, and to the larger extended family. Nuclear families typically center on a married couple, but not always; the nuclear family may have...

, and Christianity
Christianity
Christianity is a monotheistic religion based on the life and teachings of Jesus as presented in canonical gospels and other New Testament writings...

 that are each guided by a distinct institutional logic. Thornton (2004) revised Friedland and Alford’s (1991) inter-institutional scheme to six sectors, i.e., the market, the corporation, the professions, the state, the family, and religions. This revision to a theoretically abstract and analytically distinct set of ideal types makes it useful for studying multiple logics in conflict and consensus, the hybridization of logics, and institutions in other parts of society and the world. While building on Friedland and Alford’s scheme, the revision addresses the confusion created by conflating institutional sectors with ideology (democracy) and means of organization (bureaucracy), variables that can be characteristic several different institutional sectors. The institutional logic of Christianity leaves out other religions in the US and other religions that are dominant in other parts of the world. Thornton and Ocasio (2008) discuss the importance of not confusing the ideal types of the inter-institutional system with a description of the empirical observations in a study—that is to use the ideal types as meta theory and method of analysis.

New institutionalism

Organizational theorists operating within the new institutionalism
New institutionalism
New institutionalism or neoinstitutionalism is a theory that focuses on developing a sociological view of institutions--the way they interact and the way they affect society...

 (see also institutional theory
Institutional theory
Institutional theory is "A widely accepted theoretical posture that emphasizes rational myths, isomorphism, and legitimacy."FThere are two dominant trends in institutional theory:* Old Institutionalism sometimes associated with Historical institutionalism...

) have begun to develop the institutional logics concept by empricially testing it. One variant emphasizes how logics can focus the attention of key decision-makers on a particular set of issues and solutions (Ocasio, 1997), leading to logic-consistent decisions (Thornton, 2002). A fair amount of research on logics has focused on the importance of dominant logics and shifts from one logic to another (e.g., Lounsbury, 2002; Thornton, 2002; Suddaby & Greenwood, 2005). Haveman and Rao (1997) showed how the rise of Progressive thought enabled a shift in savings and loan organizational forms in the U.S. in the early 20th century. Scott et al. (2000) detailed how logic shifts in healthcare led to the valorization of different actors, behaviors and governance structures. Thornton and Ocasio (1999) analyzed how a change from professional to market logics in U.S. higher education publishing led to corollary changes in how executive succession was carried out.

While earlier work focused on ambiguity as a result of multiple and conflicting institutional logics, at the levels of analysis of society and individual roles, Friedland and Alford (1991:248-255) discussed in theory multiple and competing logics at the macro level of analsyis. Recent empirical research, inspired by the work of Bourdieu
Pierre Bourdieu
Pierre Bourdieu was a French sociologist, anthropologist, and philosopher.Starting from the role of economic capital for social positioning, Bourdieu pioneered investigative frameworks and terminologies such as cultural, social, and symbolic capital, and the concepts of habitus, field or location,...

, is developing a more pluralistic approach by focusing on multiple competing logics and contestation of meaning. By focusing on how some fields are composed of multiple logics, and thus, multiple forms of institutionally-based rationality, institutional analysts can provide new insight into practice variation and the dynamics of practice. Multiple logics can create diversity in practice by enabling variety in cognitive orientation and contestation over which practices are appropriate. As a result, such multiplicity can create enormous ambiguity, leading to logic blending, the creation of new logics, and the continued emergence of new practice variants. Thornton, Jones, and Kury (2005) showed how competing logics may never resolve but share the market space as in the case of architectural services.

Further reading

  • Boltansti, Luc and Laurent Thevenot ([1986] 1991). On Justification Economies of Worth. Princeton, NJ: Princeton University Press.

  • Friedland, Roger, and Robert R. Alford. 1991. Bringing Society Back in: Symbols, Practices, and Institutional Contradictions. pp. 232–266 in The New Institutionalism in Organizational Analysis, edited by Walter W. Powell and Paul J. DiMaggio. Chicago: University of Chicago Press.

  • Haveman, Heather A., and Hayagreeva Rao. 1997. Structuring a Theory of Moral Sentiments: Institutional and Organizational Coevolution in the Early Thrift Industry. American Journal of Sociology 102: 1606-1651.

  • Lounsbury, Michael. 2001. Institutional Sources of Practice Variation: Staffing College and University Recycling Programs. Administrative Science Quarterly, 46: 29-56.

  • Lounsbury, Michael. 2002. Institutional Transformation and Status Mobility: The Professionalization of the Field of Finance. Academy of Management Journal, 45: 255-266.

  • Lounsbury, Michael. 2007. A Tale of Two Cities: Competing Logics and Practice Variation in the Professionalizing of Mutual Funds. Academy of Management Journal, 50: 289-307

  • Lounsbury, Michael & Ellen T. Crumley. 2007. New Practice Creation: An Institutional Approach to Innovation. Organization Studies, 28: 993-1012.

  • Marquis, Chris & Lounsbury, Michael. 2007. Vive la Résistance: Competing Logics in the Consolidation of Community Banking. Academy of Management Journal, 50: 799-820.

  • Ocasio W. 1997. Towards an Attention-Based View of the Firm. Strategic Management Journal, 18:187-206.

  • Schneiberg, Marc. 2007 ‘What’s on the Path? Path dependence, organizational diversity and the problem of institutional change in the U.S. economy, 1900-1950’. Socio-Economic Review 5: 47-80.

  • Scott, W Richard, Martin Ruef, Peter Mendel, and Carol Caronna. 2000. Institutional Change and Healthcare Organizations: From Professional Dominance to Managed Care. Chicago: University of Chicago Press.

  • Suddaby, R. and R. Greenwood. 2005. Rhetorical strategies of legitimacy. Administrative Science Quarterly, 50(1): 35-67.

  • Thornton, Patricia H., and William Ocasio. 1999. Institutional Logics and the Historical Contingency of Power in Organizations: Executive Succession in the Higher Education Publishing Industry, 1958-1990. American Journal of Sociology 105: 801-843.

  • Thornton, P.H. 2002. The Rise of the Corporation in a Craft Industry: Conflict and Conformity in Institutional Logics. Academy of Management Journal, 45: 81-101.

  • Thornton, P.H. 2004. Markets from Culture: Institutional Logics and Organizational Decisions in Higher Education Publishing. Stanford, CA: Stanford University Press.

  • Thornton, Patricia, Candace Jones, and Kenneth Kury 2005. “Institutional Logics and Institutional Change: Transformation in Accounting, Architecture, and Publishing, in Candace Jones and Patricia H. Thornton (eds.) Research in the Sociology of Organizations, London: JAI.

  • Thornton, Patricia, H. and William Ocasio (2008). “Institutional Logics,” in Royston Greenwood, Christine Oliver, Salin Kerston Andersen, and Roy Suddaby (eds.) Handbook of Organizational Institutionalism, CA: Sage.
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