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How national are business systems? The role of different state types and complementary institutions in constructing homogenous systems of economic coordination and control

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30-05-2017

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  • Title:
    How national are business systems? The role of different state types and complementary institutions in constructing homogenous systems of economic coordination and control
  • Publication Details: 30-05-2017
  • Description: ____________________________________ ______________ 251Richard Whitley WORKING PAPER NO. 450 How National are Business Systems? Th e Role of Different State
  • Abstract: ____________________________________ ______________ 251Richard Whitley WORKING PAPER NO. 450 How National are Business Systems? Th e Role of Different State Types and Complementary Institutions in Constructing Homogenous Systems of Economic Coordination and Control Richard Whitley (Manchester Business School, University of Manchester and Erasmus University, Rotterdam) ( Presented to the workshop on National Business Systems in the New Global Context , Oslo, 8-11 May 2003) Manchester Business School Booth Street West Manchester M15 6PB UK Tel: 0161 275 6312 ISSN: 0954-7401 2 Introduction A central tenet of economic sociology is that culture and regulatory institutions help to constitute the nature of economic actors and guide their actions, thus affecting economic outcomes (see, e.g., DiMaggio, 1994; Smelser and Swedberg, 1994). As socially organised agents operating in different kinds of societal contexts, firms and other actors are inevitably affected by the dominant norms and conventions governing the formation of groups and how competition and collaboration between them is to be structured. The institutionalisation of separate economic arenas with their own distinct 223rules of the game224 during the development of industrial capitalism, does not, in this view, negate the socially constructed nature of firms and markets (Polanyi, 1957). Rather, it highlights the need to study how differently organised societies and systems of institutions develop distinctive kinds of market rules and actors, such that they manifest contrasting patterns of economic organisation and generate different outcomes. The autonomy and separation of the economic sphere from the rest of a social system vary between capitalist societies and are contingent upon broader institutional structures, rather than being absolute and universal, as some economists appear to assume. These constitutive and regulative institutions can, in principle, be organised as coherent business environments at a variety of territorial levels and so contrasting forms of economic organisation can become established at regional, national or international levels depending on the strength and complementarity of institutional arrangements. Complementarity here refers to the extent to which societal institutions governing, say, capital and labour markets encourage similar kinds of economic actors to behave in similar ways and reinforce each others222 effects on systems of economic coordination and control (compare, Amable, 2000). While some of these governing arrangements may become strongly complementary at the national level, others can and do vary in their cohesion and national standardisation, and may conflict in their implications for firms and markets. Just as the nation state itself is a variable and historically contingent form of political organisation, so too the strength, homogeneity and complementarity of national institutions governing economic activities vary across countries and over time. Additionally, the extent of such national homogeneity and complementarity of societal institutions is being affected by the growing internationalisation of economic coordination that can be seen to complement certain national institutional arrangements and contradict other ones, especially with regard to their ability to constrain opportunistic behaviour. As a result, not all states can be expected to exhibit a single kind of business system in all sectors and not all cohesive and stable business systems are nationally specific and bounded. The nature of firms, their strategies and capabilities frequently vary within countries, especially between sectors, technological regimes and regions, and can also overlap across national boundaries (Whitley, 1999; 2003b). __________________________________________________ 251Richard Whitley WORKING PAPER NO. 450

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