SidWinterandsomemajordivides inWesternsocio-economic thought:Self-Organization,Power,Habits,and

LearninginHumanOrganizations

This project has received funding from the European Union Horizon 2020 Research and Innovation action under grant agreement No 649186

GiovanniDosi*LuigiMarengo^

*Sant’Anna SchoolofAdvancedStudies,Pisa^Libera UniversitàInternazionale diStudi Sociali (LUISS),Roma

LargelydrawinguponDosi-Marengo,JournalofInstitutionalEconomics,2015Dosi,MarengoandNuvolari,LEMWorkingPaper2016/38

WheredoSid’scontributionsfitamongthemajordivideson,e.g.

• The“primitives”ofthetheory• Exchangevs.power• Incentivesvs.capabilities• Deliberationvs.habits/heuristics

Letmestartfromthebeginning...

• Whatareinstitutions(ofwhichorganizationsareasubset,ofwhichbusinessfirmsareafurthersubset,...)

• Andwheredotheycomefrom

Two“primitive”stories:

The“rationalist”taleOnceuponatimetherewerefullyrationalindividuals livingaloneintheforestwhothenmetinafieldtoplayaconstitutional“meta-game”calledlet’ssettherulestointeractwitheachother

The“institutionalist”taleOnceuponatimetherewereinstitutions,families,tribes,clans– whichsometimesevolved/createotherinstitutions(churches,states,firms,schools)– togethershapingtheidentitiesofindividuals

Exchangevs.power

• Hierarchieswheredotheycomefrom?- anoriginal“constitutional”exchange (hierarchies

areoutcomeofaefficiencyarrangementsnegotiatedsometimeinthepast).

- hierarchiesareareflectionofpowerrelationshipsamongsocialgroups:authorityrelationshipsareintrinsicallydifferentfromexchangerelationships(Weber)

Thenatureofhierarchies“Exchange”view “Political”view

Noanalyticalstatustothenotionofpower

Essentialfeaturesoforganizationsarepatternsofpowerexerciseandauthorityrelations

Apparent“powerrelations”canbeexplainedbyasymmetrictransactions

Power/authorityrelationsareessentiallydifferentfromexchangerelationsandthereforearealsoautonomousinterpretativedimensions

Transactionsarethebasicunitsofanalysis Unitsofanalysisincludeknowledge,organizationalforms,behaviouralcodes,mentalframes

Organizationsare“veils”coveringsetsofcontractsorbundlesofincompletecontractualagreements

Organizationsasdifferentfromandconstitutiveofexchange

Weakvs.StrongInstitutionalismWeakInstitutionalism StrongInstitutionalism

Roleofinstitutions Parametrizesystemvariables;providemenuofstrategies

Alsoembedcognitiveandbehaviouralpatterns;shapeidentityofactors

Primitivesofthetheory Perfectlyorboundedlyrationsagents

Institutionsasprimitives;formsofrationalityandperceptionofself-interestasderivedentities

Mechanismsofinstitutionsformation

Mainlyexplicitandrational“constitutional”processes

Partlyunintentionalself-organizationprocesses

Efficiencyproperties Institutionsperformusefulcoordinatingandgovernancefunctions,oftenviewedasequilibriainsomegame

Institutionsare‘carriersofhistory’,providerulesofthegameandreproducepath-dependentlyirrespectivelyofefficiency

Theorigins,dynamicsandefficiencypropertiesofinstitutions

• Gametheory,bargainingagainontheedgeoftheforest:Greif(2007)– “Whateveris,isright?”(Ogilvie,2007)“[Economists]havetendedtoadopttheviewthatifaparticulareconomicinstitutionhaspersistentstablyforalongtime,itmusthavebeenefficient….evenvigilantejusticeandlynchinghavebeenrehabilitated– underthelessrebarbativerubricof‘informallegalsystems’– asefficientsolutionstoinadequatecontractenforcementinpremodernsocieties”

• Variation-selection:institutionsassocialtechnologies(Nelson)• Exaptation• Unintentionaloutcomesofself-organizationprocesses• Byfiat powerfromabove

– “L’etat c’est moi”LouisXIV• Socialconflictnestedinasymmetricdistributionsofpower

Andwhichefficiencyproperties?

• Thejokeof“asif”maximization?– Cfr.Winter(1971)forburialnote…

• Selectiononruggedfitnesslandscapes• Moregenerally,ubiquitouspath-dependencies–Whyoneobserversinstitutionsxattimet?Weshouldlookatthelinkagesbetweenxandotherinstitutionsattimet-1

Organizationalbehaviourandperformances:threeanalytical

perspectives

• Incentives

• Authority

• Capabilities

Someconclusionsasaninvitationtojoinalargelyunexploredresearchprogramme

• AfterthefarreachinginsightsoftheEnlightenedFoundingFathersofModernSocialSciences(Smith,Marx,Weber),mostoftheprofessionrevertedtoanewreligion,possiblymoredogmaticthantheold,andcertainlymeaner…

• ForgetBentham,forgeteconomistsintheirmajority,butrather,talkingtoanAmericanaudience,gobackandtrytorigorouslyoperationalizethenotionofinstitutions/organizationsofDewey,Veblen,Commons, A.Hirschman,H.Simon,J.Marchand,lastbutnotleast,toohumblyputforwardbySid….

Threecriticalchallenges

• Combinatorics,Complementarities,Structuresofwhateverkind

• Institutionalembeddednessoftechno-economicchange

• Co-Evolution