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The Political Mobilization of Firms and Industries

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Abstract

Corporate political activity is both a long-standing preoccupation and an area of innovation for sociologists. We examine the limitations of investigating business unity without focusing directly on processes and outcomes and then review studies of five types of business political action that offer lenses into corporate power in the United States: engagement in electoral politics, direct corporate lobbying, collective action through associations and coalitions, business campaigns in civil society, and political aspects of corporate responsibility. Through these avenues, we highlight four shifts since the 1970s: (a) increasing fragmentation of capitalist interests, (b) closer attention to links between business lobbying and firms' social embeddedness, (c) a turn away from the assumption that money buys political victories, and (d) new avenues of covert corporate influence. This body of research has reinvigorated the classic elitist/pluralist debate while also raising novel questions about how business actors are adapting to (and generating changes within) their sociopolitical environments.

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... Indeed, businesses with institutional capital may be able to achieve competitive advantages through their adaptive efforts and investments in reducing institutional liabilities (Yang & Su, 2014). In order to obtain societal approval, firms may invest in building broad relationships with many stakeholders; firms may also adopt strategic activities such as lobbying, co-optation and membership in order to encourage collaboration (Walker & Rea, 2014). The accumulation of institutional capital in this way increases barriers for new entrants and helps firms win the market. ...
... Institutions control economic activity by establishing game rules that govern production, trade, and distribution (Walker & Rea, 2014). This point responding to the negative effect of E-cig institutions on E-cig industry: government policies will affect capital injection into the e-cigarette industry. ...
... In order to obtain societal approval, firms may invest in building broad relationships with many stakeholders; firms may also adopt strategic activities such as lobbying, co-optation and membership in order to encourage collaboration (Walker & Rea, 2014). The institutions tend to benefit to build the competitive advantage on E-cig industry. ...
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This qualitative research explored the current E-cig institutions in China and how E-cig retail owners perceived the E-cig related regulation under the theory foundation of institutional theory. An intrinsic case method applied in this study. Template analysis used to analyze the information of documents and interviews. In summary, the E-cig institutions have positive and negative effects on in both E-cig retail shops and E-cig industry. The study will contribute to the intuitional theory research in qualitative way and have practical meaning for E-cig retailers to identify and evaluate the institutional environment.
... If state structures dominate then the structural power of business is weak, but when regions become integrated into the global economy and capital is mobile then the structural power of business becomes stronger. Instrumental power, on the other hand, refers to business actors' 'capacity for deliberate political action' (Hirschman 1970: 28), including engagement in corporate lobbying, media campaigns, electoral politics and core constituency relationships with political parties, informal ties to politicians and bureaucrats, trade associations and business collective action, and civil society initiatives (Walker and Rea 2014). Fairfield (2015) argues that structural power should be analysed alongside instrumental power to understand how business actors shape variations in policy outcomes, driving divergent development trajectories. ...
... Institutional intermediaries act as coordinators or translators between the interests of transnational capital and local institutions operating at different scales (Phelps and Wood 2006). For example, institutional intermediaries such as industry associations may lobby local-national state agencies for favourable industrial policy, training provision and labour regulations that match business needs (Phelps, Valler, and Wood 2005;Walker and Rea 2014;Kleibert and Mann 2020). Often intermediaries together with state agencies co-shape customized incentive packages to attract MNEs, bidding up the incentives secured by transnational elites and amplifying the asymmetric relations between firms and regional institutions (Thomas 2000). ...
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We develop and deploy a business politics lens to examine the mechanisms and processes of negotiation through which multinational enterprises (MNEs) and various host country actors interact, leading to different regional trajectories of economic development. We assess two contrasting lead firms from differing home country contexts investing in the automotive industry in Romania, operating in two regions with distinct historical-spatial industrial organization and economic development. We advance a contribution on business politics as dynamic, relational, multi-scalar, and influenced by varied conjunctural factors-historical, geographical, political, institutional, and firm-driven-exposing how MNEs and territorial actors co-shape distinct processes of international economic (dis)integration.
... Sociologists and political scientists argue that businesses can act to gain power, particularly in the face of threats to their interests (Walker & Rea, 2014). The resource dependence theory also suggests that political connections help firms function well and seek protection from outside dangers through cooptation. ...
... Our data suggested that by influencing lawmakers and engaging in short and long-term forgetting work strategies, Enbridge dominated the political sphere to develop a collective remembrance of this incident, which contributed to its forgetting work success, despite the persistence of local narratives. These findings support Walker and Rea (2014) and Hillman et al. (2004) argument that a corporation's political activity can enable favorable outcomes, especially in the event of threats to its business interests. ...
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Corporate social irresponsibility continues despite institutional pressures for socially responsible behavior, resulting in disasters like the Kalamazoo River Oil Spill and the Exxon Valdez Oil Spill. We conduct an in-depth abductive analysis of the Kalamazoo River Oil Spill to explain factors that enable corporate forgetting work projects. Specifically, we illustrate how a corporation’s political activities allow it to gain the power to suppress its mnemonic community’s voices, thereby attenuating an irresponsible event’s memory from the minds of its stakeholders, protecting its image, and maintaining legitimacy in the shareholder and state’s eyes. We also highlight how the remembrance and forgetting of an irresponsible incident diverges between stakeholders based on their characteristics, future goals, and aspirations and whether they directly suffered from the disaster. Our research makes notable contributions to forgetting work literature by highlighting the importance of corporate political activities and context on the success of corporate forgetting work projects.
... Firms are stepping up initiatives and applying greater political pressure to relax regulation of their activities and to help shape their institutional, economic, financial, and social environments (Walker and Rea, 2014). In doing so, they have more than ever become a major political force in society. ...
... In fact, what we call the instrumentalist approach encompasses two groups of research disciplines or fields: sociology (in particular, political sociology, for the "how" question, and economic sociology, for the impact issue) and strategic management. However, as recognized by Walker and Rea (2014), management scholars recently have become significantly more active in researching corporate political action than have sociologists. Therefore, sociologists should normally focus on the process (the how) of corporate mobilization, particularly through lobbying, as the latter is supposed to be a social activity embedded in the institutional, cultural, and organizational setting. ...
... Although there has been rising interest in the political aspects of CSR in the general management literature (Schrerer andPalazzo, 2007, 2011;Whelan, 2012;Frynas and Stephens, 2015;Muthuri and Gilbert, 2011;Chapple and Moon, 2007;Prechel and Morris, 2010;Walker and Rea, 2014;Lux et al., 2011), accounting researchers have paid relatively scant attention to this important contextual factor. Consequently, the dynamics between politics and CSR disclosures have remained relatively under researched (Gu et al., 2013) and under-theorized (Uddin et al., 2018). ...
... The prevalence of political interests and patronage in corporations is well noted in the wider management literature (Chapple and Moon, 2007;Lux et al., 2011;Muthuri and Gilbert, 2011;Walker and Rea, 2014;Maak et al., 2016). However, this work mainly addresses the political duties and activities of, in particular, multinational corporations (MNCs) (Crane et al., 2008;Hsieh, 2009;Palazzo, 2007, 2011). ...
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Abstract Purpose – The objective of this paper is to investigate the emergence of corporate political activities (CPAs) in the form of social responsibility in the banking sector in Bangladesh. The use of institutional logics allows the authors to explore not only the motivations underlying this sudden shift in corporate approach towards corporate social reporting (CSR) disclosure but also to investigate whether a logical plurality exists in this new approach. Design/methodology/approach – The analysis is based on 21 in-depth interviews with policymakers, regulatory bodies and top management and members of boards of directors in the banking sector. Findings – The findings of this study are both consistent with and different to those of Uddin et al. (2018). While their findings show that Bangladeshi companies engage in CSR activities primarily to demonstrate their allegiance with the ruling political regime driven by notions of traditionalism, this study’s findings show the existence of a logical pluralism across industries in the manner they engage with CSR activities and disclosures. In addition to the dominant market logic, the authors also find the co-existence of community and family logics shaping the nature of CSR disclosures made by banking companies in Bangladesh. Originality/value – The authors contribute to the accounting and management literature by providing first- hand evidence of the motivations underlying the emergence of CPAs in the context of a developing country. The adoption of an alternative theoretical framework allows the authors to identify the multiple logics that dictate corporate attitude towards CSR engagement and disclosure.
... 53 This concentration of corporate power has not only exacerbated economic inequality 54,55 but has also buttressed corporate political power over social institutions, economic governance processes, 56 and public policy more generally. 57,58 Corporate power deployed at the macro-political level shapes societal institutions that structure the nature of work, our identities as workers and consumers, the regulatory environment, and planetary health. Corporate power is exercised through various forms of political action or "mechanisms of influence," 25 of which lobbying is but one. ...
... Political donations, public relations campaigns, grassroots organizing, corporate responsibility programs, and business associations' coordination of inter-firm political action are additional welldocumented mechanisms, which are deployed individually or in concert. 2,27,58 From a neo-Gramscian perspective, the hegemony of business rests on an alignment of economic, cultural, and political forces; processes of accommodation and co-optation enable business to protect itself against challenges from rival groups, such as labor and environmentalists, while projecting an image of moral leadership for the common good. 9,59,60 Concern has grown in recent years about the implications of the rise of monopolistic internet technology behemoths in sectors including social networks, online commerce, search and advertising, and media/news. ...
... Several recent contributions note an increasing tendency for trade dependent companies to lobby alone on trade issues (Bombardini and Trebbi, 2012;Madeira, 2016), as well as a tendency to mobilize transnationally (Eckhardt and De Bièvre, 2015;Curran and Eckhardt, 2017; and in cooperation with NGOs (Walker and Rea, 2014), in addition to more traditional cooperation with trade unions (Brook, 2005). In this short chapter, we seek to contribute to better understanding of CPA on trade in the age of populism, focusing in particular on their collective actions. ...
... Finally, another issue which we explored was the extent to which the pro-trade business elite was active in constituency building with civil society groups, to help increase the legitimacy of their messages (Hillman and Hitt, 1999;Walker and Rea, 2014). We found several examples of such coalitions in the Brexit debate, where common interests with unions (on jobs) and NGOs (on access to medicines and environmental protection) resulted in cooperation on position papers and/or lobbying efforts. ...
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This chapter explores the strategic responses of trade dependent firms (TDFs) to growing populism and trade protectionism, focusing on the EU business elite over the period 2016-2020. It firstly highlights the threats posed to TDFs by several protectionist shifts (primarily Brexit, US protectionism under the Trump administration and its threat to WTO). It then explores their strategic responses in the EU, mobilising interviews with policy makers and trade associations in sectors which are highly dependent on trade. It finds that, overall, the mobilisation of EU business elites was relatively low profile. In most cases, firms relied on their associations to lobby on their behalf. Although, in the case of Brexit, a very clear and present threat, these associations created quite extensive coalitions, including with civil society, individual company mobilisation was still relatively limited. In the case of the more generic threats we explored, although associations were very active, individual TDFs were not. Interviewees attributed this passivity to concerns about reputation effects from supporting a controversial issue (free trade), limited understanding of the extent of the threat and lack of capacity in many smaller companies.
... Business-class theory refers to processes in which "corporate elites" form a "class" capable of mobilizing for collective political action to address political challenges to corporate capitalism as a whole (for overviews, see Carroll, 2018;Walker & Rea, 2014). Class theorists recognize that class formation is not universal but centers on the "inner circle" of the leaders of the largest corporations across industry sectors, who develop a shared awareness and commitment to the class interest (Mills, 1956;Mizruchi, 1992;Useem, 1984). ...
... While the WBCSD project involves efforts to incorporate states and interstate organizations into governance privatization, its main thrust is to create, through various forms of institutional work, institutions that relocate governance responsibilities and functions from the state to corporations, such as corporate responsibility and multistakeholder frameworks. Exploring these state-bypassing forms of business power from a neo-institutional perspective can bolster the quest to recognize new avenues of corporate influence and ways by which corporations generate changes within their sociopolitical environments (Walker & Rea, 2014). ...
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Regardless of the enormous risks to humanity, the three-decades-long international effort to administer sustainability has seen an intensifying process of governance privatization, coupled with a failure to reduce global emissions. Bridging neo-institutional and business-class theories, I examine the mobilization of a class-wide coalition of major transnational corporations on a long-term institutional project to shape environmental governance in the mold of a private, market-based institutional logic. Drawing from analyses of the structure, discourse, and activities of the transnational business association World Business Council for Sustainable Development circa 1990–2010, I show how the WBCSD unites the CEOs of some of the largest transnational corporations into a cohesive leadership group, mobilizes the corporate resources they command, and coordinates global-scale, durable institutional creation work. The project’s purpose is to crowd out the state-based logic of environmental governance, thus restricting the development of market-incongruent sustainability organizing. The article contributes to the understanding of societal-level, large-scale institutional work by examining the key agency of business classes in such work, the organization of large-scale work through multifaceted projects, and its orientation to set institutional logics through diverse creation of institutional forms that embody the logic.
... For example, in political science and public policy, there is a rich tradition on various forms of advocacy coalitions with diverse sets of actors, including government officials, interest groups and scientists (Sabatier 1988;Weible et al. 2009), but rarely is the focus solely on trade associations (Drope and Hansen 2009). Likewise, there are few studies in business and management or sociology that explore trade associations directly (Aldrich 2018: 24;Lawton et al. 2018;Walker and Rea 2014). This is surprising given that studies that have zeroed in on trade associations have highlighted their prevalence in the USA and their political activities (Barnett 2012;Spillman 2012;Aldrich 2018). ...
... Scholars across political science, sociology and business and management frequently call for more "systematic research" on trade associations, their functions and activities (Aldrich 2018: 24;Drope and Hansen 2009;Lawton et al. 2018;Walker and Rea 2014). Yet to the extent that research has been conducted on trade associations the focus is typically on why individual firms establish trade associations and participate in collective action (Drope and Hansen 2009;Kowal 2018). ...
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The political activities of industries associated with the production and consumption of fossil fuels have thwarted state efforts to advance climate policy. Yet research on the role of trade associations that firms use to coordinate their activities remains sparse. Studies of business political activity are generally focussed on the firm level with trade associations typically considered only as part of wider advocacy coalitions. Scholars are still to examine the full range of political activities of trade associations. Using an original dataset built from trade associations’ IRS filings, we find that trade associations engaged on climate change spent $3.4 billion in 10 years on political activities, with the largest expenditure on advertising and promotion, followed by lobbying, grants and political contributions. Our data challenges the prevailing assumptions about the primary political activities of business actors. To explain the variation in spending, we present the findings from a regression analysis and semi-structured interviews. We argue that scholars have for too long failed to account for the political activities of trade associations, which are also one of the most important opponents of climate policies.
... Indeed, CEOs and firms have a history of influencing government policy behind the scenes by avoiding public discussion of covert financial actions (e.g., Hillman et al., 2004;McKean, 2024). Corporate political activity-for example-is often not publicized because of the potential for it to be controversial or harmful to the firm (e.g., if stakeholders learn of lobbying activities of which they disapprove and protest; King & Walker, 2014;Walker & Rea, 2014) and we similarly expect there may be times when CEOs wish to conceal their active engagement with a sociopolitical stance. Covert activism uniquely enables a CEO to avoid the potential backlash of publicly endorsing a stance on a controversial issue while still enacting meaningful change through covert resource allocation. ...
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The traditional responsibility of a CEO—prioritizing firm performance and shareholder returns—has become increasingly intertwined with expectations to actively engage with sociopolitical issues. These competing expectations have created a scenario where engaging, not engaging, or incorrectly engaging in CEO activism all carry the risk of alienating at least some stakeholders and undermining CEO and firm reputation and performance. Further, extant research has primarily focused on whether CEOs engage in activism rather than disentangling the heterogeneous ways by which they do so. We address these shortcomings and augment existing theory by comprehensively considering distinct CEO activism engagement strategies, their outcomes, and the moderators influencing relations between the two. Moreover, we illuminate the highly heterogeneous nature of CEO activism to better capture the phenomenon’s complexity. We first introduce the CEO Activism Decision Matrix—a typology of four unique activism engagement strategies based on the behavioral dimensions of CEO Talk (leveraging communicative power) and CEO Action (leveraging economic power), successfully addressing the heterogeneity in activism behaviors that existing theory has overlooked. We then present an integrative conceptual model that outlines the short- and long-term consequences and relevant moderators of CEO activism engagement and offer detailed recommendations for future research, including methodological guidance on operationalizing variables and designing research that can infer causality. Altogether, we demonstrate that although CEOs may find themselves “damned if you do, and damned if you don’t” engage in activism, they also have the potential to drive meaningful career, firm, and societal change based on how they choose to engage.
... The body of research concerning the role of corporate influence has highlighted the intricate relationship between corporations and their influence over regulatory and governance systems, which sometimes occasion crises for the corporation and the regulator. Through lobbying and political campaign financing, researchers argue that corporate interests can become an overarching influence over government decisions which could contribute to crises in the end (Walker and Rea 2014). Other studies outline the concept of globalization and interconnected economies as a possible avenue to explain how corporate power, often transnational, contributes to systemic crises of global proportions (Cox 2019). ...
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The Boeing 737 MAX crisis, which started in 2018 and continued in 2019, has drawn researchers to investigate the events preceding and after the deadly crashes. The two accidents involving Lion Air Flight 610 and Ethiopian Airways Flight 302 raised safety concerns over one of Boeing's flagship airplanes, the 737 MAX, occasioning a global grounding of the famous airplane. This study delves into the investigative report produced by the US House Committee on Transportation and Infrastructure concerning the design, certification, and manufacturing of the 737 MAX. The study utilized qualitative analysis to examine the implicit yet impacting communicative elements embedded in the report. Through the analysis, the study identified patterns of organizational culture, corporate power or hegemony, and capitalism as emerging themes that may have contributed to the catastrophic accidents in 2018 and 2019. Implications for the Trans‐MOC model of organizational culture are discussed.
... To some this might suggest that these practices could be labelled as 'corporate political action'. However, in the CPA literature, the targets are government policies and regulations, that is, the aim is to obtain policies and laws that are favourable to their market performance and customer satisfaction (Walker, 2014;Walker & Rea, 2014). Corporate contentious politics, however, concern efforts to manipulate the implementation of regulation. ...
... In particular, a key insight from recent scholarship in comparative political economy and industrial relations is that business power and the political preferences of business owners, employers and managerial organizations have become key to shaping policy outcomes across advanced political economies (Culpepper, 2010(Culpepper, , 2015(Culpepper, , 2021Busemeyer, 2012;Walker and Rea, 2014;Fairfield, 2015;Wright, 2017;Bohle and Regan, 2021;Morgan and Ibsen, 2021), in some cases at the expense of the power and influence of organized labour, which has been portrayed as having suffered considerable decline in the age of liberalization (Culpepper and Regan, 2014;Baccaro and Howell, 2017;Rathgeb and Tassinari, 2022). ...
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How do organized economic interests affect the governance of the coronavirus disease 2019 (Covid-19) pandemic? We investigate whether the structural and instrumental power of employer organizations and unions impact upon the stringency of containment measures implemented by governing authorities to tackle the Covid-19 pandemic, focusing on Italy during the first Covid-19 wave of early 2020 as a crucial case. Using Hausman-Taylor panel regression models and original indicators of regional stringency and of unions and employers' organizations' efforts to exercise instrumental power via public pressure on social media, we find that the intensity of public pressure by employer organizations is negatively correlated with the stringency of the policy responses implemented by regional authorities to tackle the Covid-19 pandemic, whilst union pressures only show a limited effect. Our findings demonstrate that business pressure and the interplay of economic and class interests are constitu-tive of the governance of a crucial social and public health phenomenon such as the Covid-19 pandemic.
... Existing literature also reflects on the other cognitive frames identified in our analysis. Social embeddedness has been recognized as a factor shaping companies' market and non-market behavior (Walker & Rea, 2014). Our results suggest that stronger embeddedness in networks and lower willingness to reshape existing relationships, such as in the case of BMW, may stand in the way of sensing new opportunities. ...
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After the internal combustion engine was the dominant technology in the automotive industry for more than a century, a transition to electric cars is now under way. However, not all car manufacturers seem equally determined to move away from fossil fuels. Based on a comparative case study of German automakers, we discuss some underlying factors associated with variation in electrification strategies. Conceptually, we focus on firms' dynamic capabilities—in particular, their ability to sense low‐carbon risks and opportunities in a changing business environment. Building on qualitative interviews, we gauge sensing capabilities through industry executives' cognitive frames. Our analysis reveals striking differences in the way executives perceive the opportunities and risks associated with electric mobility. In particular, firms' dynamic capabilities to shape the low‐carbon transition are tied to their conceptions of consumer preferences and the economics of the transition, their perception of network embeddedness, prior experiences with technological innovation, and leadership.
... Political influence on corporations and the existence of political patronage have been well documented in prior literature (Mathuri and Gilbert, 2011;Chapple and Moon, 2007;Prachel and Morris, 2010;Walker andRea, 2014, Lux et al., 2011;Uddin et al., 2018). Previous research, primarily in the area of management studies and political science, have documented the relationship between political connections and the quality of accounting information, performance of firms, and corporate bailouts of politically connected firms (Ball et al., 2003, Chaney et al., 2011, Bliss et al., 2011. ...
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The objective of this paper is to investigate the relationship between audit fees, audit delay, and political connections in the context of an emerging economy, namely, Bangladesh. For the purpose of this study, the author uses 576 firm-year observations (2010 to 2015 inclusive) of companies listed in Dhaka Stock Exchange. A number of OLS regression models are used to capture the relationship between audit fees, audit delay and political connections. The results indicate that political connection is significant as an explanatory variable for audit fees for all companies as well as for export oriented companies, but however, there is no evidence of political connections being an explanatory variable for audit delay. Some corporate governance variables and ownership structures are also found to be significant variables for audit fees and audit delay. The analysis appears to suggest that politically connected firms tend to manage the interests of the political power at the expense of other shareholders by managing the earnings in the annual reports, which is likely to affect the firm's risk and require the auditor's extra risk and extra effort and thus more audit fees. The demand for quality audit in export-oriented industries, however, allows auditors to perform a more rigorous audit, and thus charge higher audit fees.
... The organizational and management literature uses several different terms to refer to various aspects of the concept, such as reputation for being "other-regarding" or "doing good" (Kurucz et al. 2008;Martinez et al. 2017;Tetrault Sirsly and Lvina 2019), reputation for using power responsibly (Kurucz et al. 2008), moral legitimacy (Bitektine 2011), or public reputation reflecting the extent of adherence to social norms and values (Deephouse and Carter 2005). This good sociopolitical reputation could then be used to develop goodwill with a variety of stakeholders such as investors, customers, and employees (Fombrun et al. 2000;Gardberg and Fombrun 2006;Walker and Rea 2014) and the public at large (Fombrun and Shanley 1990). ...
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This article argues that differences in sociopolitical reputation can explain why interest groups fail or succeed in influencing policymakers and that therefore sociopolitical reputation is a useful addition to the conceptual toolbox of interest groups scholars. Focusing on pharmacies and their associations in Greece and Portugal between 2005 and 2021, this article uses the concept of sociopolitical reputation to explain why reform attempts to reduce pharmaceutical spending and increase competition in the pharmacy sector were successful in Portugal but not in Greece, even though pharmacists are a much stronger interest group in Portugal than in Greece and even though both countries were under significant exogenous pressure to introduce structural reforms in the wake of the Eurozone crisis.
... Based on prior work [56,57], we consider actors' networks, material and non-material resources and discursive skills as primary blocks for institutional work practices, with some practices requiring more endowments than others. Actors' network resources denote the ties and proximity to actors who are crucial for influencing policymaking [58,59]. While material resources include financial assets and physical or technological artefacts, non-material resources comprise political and judicial expertise including the conflict resource which indicates the capability of creating electoral pressure on politicians seeking votes [60]. ...
... 61 This suggests that the question of business preference unity/fragmentation should be treated independently from the question of business policymaking power. 62 Methodologically, this means it is ill-advised to rely on the stated policy preferences of "peak organizations" as a proxy for all business preferences; it is necessary to evaluate business preferences at a more granular level to then be able to assess the degree to which such preferences are ultimately reflected in policy, and at whose expense. 63 When it comes to climate policy, we know that business preferences are fragmented. ...
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To what extent and through which means do private actors shape public policy? Research into these questions has been complicated by actors’ tendency to obscure or misrepresent their policy preferences and by the difficulty of operationalizing policy substance. This theory-building study uses qualitative methods and triangulation of multiple sources of evidence to mitigate these challenges. Confronted with puzzling patterns of variation in the design of state-level climate and renewable energy policies, I show how a two-dimensional framework attentive to the economically motivated preferences of business actors explains policy design. Drawing on policy texts, archival documents, and 111 policy-focused interviews, I find business preferences were fragmented, but that a single type of private actor, investor-owned utilities, ultimately prevailed in achieving their preferences in every case. I theorize the sources of their unmatched influence, and find that their distinctiveness is precisely what makes them powerful. My findings have implications for the study of business power and understanding obstacles to equitable climate policymaking.
... All this implies that institutions are both highly durable and, at the same time, subject to invention and creative redesign that may produce very rapid change that incorporates both processes and recipes that redefine what an organization type is in terms of processes used, recipes adopted, and how these are integrated into a whole. For example, E. T. Walker and Rea (2014) suggest that many corporations now borrow social movement structures and tools. Bottom-line performance and legitimacy of the firm is often enhanced. ...
... The emphasis on culture in economic sociology emerged along with the cultural turn in the discipline, which placed increased emphasis on institutional norms and culture (Gray and Silbey 2014). Although norms, which embody values (Zafirovski 1999;Swedberg 2003Swedberg : 29, 2011, are important, rather than integrating culture into the existing literature, this focus has displaced an analysis of structures and hierarchies and how social actors exercise power to enact policies, laws, and rules to preserve or advance their interests (Walker and Rea 2014). ...
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... In recent years, especially in the wake of the Citizens United Supreme Court case in the United Stateswhich removed prohibitions on political speech by corporationsthe business literature (Lux et al. 2011;Dieleman and Boddewyn, 2012;Alzola, 2013;Macher and Mayo, 2015;Néron, 2016) has moved in lockstep with political science and sociological research (Burns and Jindra, 2014;Walker and Rea, 2014;Kim and Darnall, 2016) in portraying the CPA of firms as having a major role in shaping political decision-making (even if, as Hansen et al., 2015) show, early results post-Citizens United were that corporate behavior did not change immensely). This effect has been given credibility empirically through work which shows that firms that engage in CPA have higher firm valuations (Brown et al., 2015), better market perceptions of connections as an intangible asset (Croci et al. 2017), more successful initial public offerings (Rudy and Cavich, 2020), or larger market shares (Lux, 2016). ...
Article
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Populism is an ideologically fluid political vehicle which increases political risk and forces firms to adapt. As populist parties claim to speak exclusively for the people, any activities that could be perceived as going against populist ideals or leaders are problematic from the corporate point of view. These obligations need not require firms to actively support the populist party or to champion causes dear to the populists, as they may simply expect that firms refrain from challenging the status quo. But these expectations can alter firm operations and planning, particularly intangible activities such as corporate social responsibility, making a firm divert resources away from what it may desire to compete in the economic marketplace and forcing it instead to compete in the social and political marketplace. In this paper, we explore these obligations imposed on firms and term them corporate political responsibility (CPR), a specific type of corporate political activity imposed from the outside. Through our examination, we find that CPR is the dark side of stakeholder capitalism, with the use of state power claiming rights within the marketplace that are not theirs to claim.
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Climate change has been a contentious political issue in the United States for many years. Although research at the national level has documented how fossil fuel interests have inhibited the United States from adopting a serious climate policy agenda, the situation among states is more heterogeneous. Using an original data set of 48 U.S. states from 1997 to 2020, I examine how qualitative variations in state energy policies are the product of conflicts between environmental groups, fossil fuel producers, utility providers, and political parties as they vie for power and influence. I show that Democratic party power, higher political spending from environmental organizations, lower investor-owned utility market share, higher publicly owned utility market share, and lower levels of fossil fuel production and political spending lead to more stringent policies. In contrast, weaker policies are more likely in states where the prototypical opponents of climate policy, Republican politicians and oil and gas interests, have greater power.
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Research Summary This article examines the association between ideology and firm participation in sociopolitical activism. In particular, it focuses on the ideological alignment between a firm's upper echelons and its general employees. We theorize that participation in progressive corporate activism reflects the ideological views of both the top management team and general employees. By examining firm participation in letter campaigns supporting progressive causes, our findings indicate that ideological alignment between a top management teams and general employees' liberal political leanings is associated with a firm's participation in progressive corporate activism. The CEO's own ideological preferences do not have an independent association with this kind of activism. This article concludes with a discussion of implications for our understanding of corporate political action and nonmarket strategy. Managerial Summary This article looks at the relationship between political ideology and firm participation in sociopolitical activism. Although some have argued that firms' activism reflects a CEO's ideological preferences or employee activism, we find that neither explanation fully accounts for the kinds of companies that engage in this kind of activism. We find that progressive corporate activism reflects the ideological views of both top management and general employees. Our findings suggest that companies that have ideological alignment on progressive issues are more likely to take public stands on those issues because the stands reinforce core values held by employees and the top management.
Article
Gig work – accessing job opportunities through an app – has brought renewed attention to precarious non-standard labour arrangements. Scholars have begun to consider the intermediary role that platforms such as Uber, Lyft and Doordash play in exploiting and controlling workers. Yet, literature on labour market intermediaries has muddied conceptions of their role, impact and outcomes for workers by lumping a variety of institutions under the same umbrella term. Drawing from previous theoretical and empirical works throughout the temporary help and gig industries, this article proposes a reconceptualisation of labour market intermediaries as labour market engineers highlighting four mutually reinforcing features. This sociological reconceptualisation updates the understanding of for-profit labour market intermediaries by demonstrating the market making behaviours of firms of on-demand labour in the US context. Likewise, this reconceptualisation notes how gig firms have adapted and expanded these features in ways that increase precarity for workers.
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Unequal representation can result from politicians’ biased perception of public opinion. Existing research has focused on the numerical accuracy with which politicians estimate preferences distributions in surveys. This method ignores politicians’ broader assumptions about public preferences; e.g. regarding their crystallization, salience, malleability, and measurability in surveys. We address these assumptions in a novel two-stage research design using redistributive tax policy in Germany as a case. Interviews with parliamentarians show that voters are perceived as uninformed, disinterested, and susceptible to anti-tax mobilization by business representatives. Support for taxing the rich in polls is dismissed as superficial and irrelevant for political behavior. In a second step, we verify these assumptions in twelve focus groups with high- or low-educated citizens. They largely confirm the assumed indifference and anti-tax attitudes. An education gap in tax preferences cannot be identified. Support expressed in previous surveys tends to disappear in conversations, which aligns with politicians’ experiences.
Article
Studies of financialization have highlighted how politics, particularly through the state, drives the increasing entanglement of financial actors and rationales in the production of urban space. This article shifts the angle to consider the challenges that uncertain politics pose for such entanglement. Looking beyond techno-calculative practices, it explores how finance works politically to sustain value extraction within fragmented regulatory landscapes. It does so through historical and ethnographic analysis of financial investment in urban water and sanitation provision in Brazil, drawing on fieldwork, interviews, and a new dataset on public-private contracts to interrogate how private water companies navigate politico-regulatory relations under financial investors like private equity. It shows that while these providers were quite engaged in local politics under their original owners (construction groups), under financial investors they sought to “escape” it by curbing ties to public officials, reducing the autonomy of local subsidiaries, and successfully lobbying for national standards on regulatory norms. It argues these centralizing efforts constituted forms of centripetal politics meant to enhance asset monitoring, increase regulatory legibility, and reduce political uncertainty. The findings illuminate how financial investors work across political scales to navigate political risk and sustain financial value, thus problematizing the conventional analytical focus on how finance capitalizes on local forms of entrepreneurial politics. Crucially, they reveal the need to treat institutional environments not simply as filters for financial investment but as objects of political contestation by financial actors. This allows for blurring the boundaries between finance and politics, and for politicizing finance.
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Purpose The purpose of this study is to understand how and why consumers engage in market-shaping activities on behalf of firms. Design/methodology/approach This study uses a combination of archival, netnographic and interview methods to examine how consumers responded to the entry of Tesla into the U.S. automotive market. Findings Consumers are driven to engage in supportive institutional work by the culturally resonant ideologies embodied in Tesla’s strategic orientation. This work takes both discursive and practical forms and sees consumers adopting responsibilities typically associated with other actors, including activists and sales professionals. Originality/value In developing an account of an understudied phenomenon – consumers’ firm-supportive market shaping – this research extends theorization around institutional work and cultural branding.
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We cross-fertilize insights from corporate political activity (CPA) and open-strategy literatures to propose a research agenda on open political strategy – or greater participation and visibility in firms’ actions aimed at shaping public policy. Incorporating ideas from open-strategy research, CPA scholars can upgrade knowledge about firms’ political actions, and ensure their theorizing keeps pace with contemporary practice. Considering the specificities of CPA, open-strategy scholars can extend the boundaries of their field, and generate fresh insights into how firms open up strategy in contexts previously unexplored. Through a more critical reading of open political strategy, we also raise broader questions – addressing its repercussions for broader society – that should chime more generally with scholars of strategy and organization, especially those interested in firms’ strategic responses to institutional pressures, and the ‘dark sides’ of strategizing and organizing.
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Behind closed doors, many large companies quietly use their political clout to influence public policy on social and environmental issues – often in a negative direction. This book seeks to create a new norm for responsible political behaviour by corporations. It brings together leading scholars of corporate political responsibility with leading organizations that have been working to support companies in adopting more responsible political practices. The contributors present new evidence on what motivates firms to become more responsible and how markets view corporate 'dark money' spending. They also explain how activists have pressed companies to play a more responsible role in politics. With a particular focus on climate change and the important role of corporate lobbying in supporting or blocking climate policy, this volume leads the way forward for researchers, activists and citizens who seek a future in which corporate political influence is transparent, accountable and responsible.
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Behind closed doors, many large companies quietly use their political clout to influence public policy on social and environmental issues – often in a negative direction. This book seeks to create a new norm for responsible political behaviour by corporations. It brings together leading scholars of corporate political responsibility with leading organizations that have been working to support companies in adopting more responsible political practices. The contributors present new evidence on what motivates firms to become more responsible and how markets view corporate 'dark money' spending. They also explain how activists have pressed companies to play a more responsible role in politics. With a particular focus on climate change and the important role of corporate lobbying in supporting or blocking climate policy, this volume leads the way forward for researchers, activists and citizens who seek a future in which corporate political influence is transparent, accountable and responsible.
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Lobbying, and its role in the policy process, has been extensively studied in democratic states, but much less is known about similar practices in authoritarian political systems. Although a few studies have identified lobbying in China, most have focused on big businesses and national policy making, and some have argued that it is unaffected by differences in political institutions. Our paper challenges this portrayal of business lobbying in autocracies. Through a study of the lobbying activities of business associations based on documentary research and fieldwork in the northern Chinese city of Tianjin between 2011 and 2013, we show that although business associations have similar lobbying motivations to their counterparts in democracies, their specific practices are often shaped by authoritarian political institutions. While they are similar in seeking to build informal relationships with public officials, provide expertise to shape policies, and raise their profile through public relations activities and media engagement, they differ in focusing their relationship‐building efforts on helping officials with routine work, helping Communist Party organizations establish cells in businesses, and brokering between businesses and government. Rather than donating to political campaigns like their counterparts in democracies, they become legislators themselves, hire retired officials, and seek positions on advisory bodies. Rigged elections, an unreliable legal system, and restrictions on media and freedom of movement are key authoritarian institutions that shape these distinctive lobbying practices.
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Humanity has not been able to operate a sustainable food system globally. Radical transformation in society and the economy is needed to make food production serve the well-being of all human and non-human stakeholders while respecting planetary boundaries. This paper reviews the literature on the problem of food production in the Anthropocene. It then explores how a business enterprise might also serve as a social movement and the way in which the interaction between the two can create sustainable value. The case of Green Monday, a social movement and start-up group selling plant-based food, established in Hong Kong and promoting low-carbon emissions, sustainable lifestyles, food security, and animal welfare is presented and examined. The case study provides some valuable insights into how the collaborative actions of a social movement and a related business organization can help to meet real human needs and contribute to preservation and regeneration of nature.
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Despite the growing influence of Corporate Political Activities (CPA) and the rising concern over its societal impact, mainstream CPA research has largely focused on the instrumental value of CPA. In other words, a focus on the firm as the sole beneficiary of CPA and thereby ignoring, for the most part, ethical and normative analyses of CPA, as well as the risks and social costs it may engender. There is a significant gap between mainstream CPA research focused on political strategies and their effect on corporate performance on one hand, and normative ethics research focused on what CPA ought to be on the other. In this special issue editorial essay about critical views of CPA we situate within extant CPA literature the contributions of three novel articles exploring the negative aspects of CPA. We also discuss how the future of CPA research can include a robust critical/normative perspective in order to generate socially relevant and practically useful research.
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How does the exchange of employees between regulatory agencies and regulated firms (i.e., the firm-government revolving door) affect firm regulatory outcomes? Existing work has mostly found a positive impact of revolving door hiring on firm outcomes, but it has overlooked potential limitations of this corporate political activity (CPA) tactic. We argue that the advantages firms can gain from hiring former regulators are bound by the timing of revolving door employment relative to the regulatory process. Within the context of agribiotechnology and its main regulator, the U.S. Department of Agriculture, we study regulators who move to in-house and contract lobbying positions (i.e., exit revolving door). We find that firms receive better regulatory outcomes (i.e., faster regulatory approval for new crops) only prior to the regulators’ move to in-house lobbying, consistent with the regulatory capture perspective. Moreover, this revolving door was only valuable in the time period immediately before the mobility event. Additionally, contrary to the belief that former regulators provide firms with expertise and social capital as lobbyists, we find that firms did not gain any advantage after regulators became lobbyists. Taken together, our results suggest that revolving doors can be an effective business political mobilization strategy, albeit one that has limited success in shaping firm government outcomes, much like other types of CPA. Supplemental Material: The online appendix is available at https://doi.org/10.1287/orsc.2023.1669 .
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Platform economy politics reflect a trend of corporations working with civic actors to achieve shared political goals, reconfiguring once adversarial relationships (e.g., management vs. labor, homeowners vs. tenants). Yet theories on urban politics and policymaking often do not account for such “Baptist-Bootlegger” coalitions (Smith and Yandle 2014; Yandle 1983). This article analyzes how the efforts of two competing Baptist-Bootlegger coalitions shaped the 2018 short-term rental (i.e., Airbnb, HomeAway) ordinance in Los Angeles, CA, USA. I argue that a subtly coordinated partnership of housing groups, neighborhood activists, and hotel market incumbents leveraged their individual authenticity and resources to successfully articulate a shared vision with policymakers. Conversely, an opposing coalition of short-term rental platforms and hosts more explicitly combined their efforts under an organizational framework that conflated economic and moral claims; this hybrid organizational identity was perceived as less authentic by policymaking audiences and precluded potentially more strategic forms of organizing.
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Artificial intelligence technology offers a wealth of opportunities for government to serve its constituencies and address its mission. Technology providers paint a picture of unlimited possibilities and the fulfillment of dreamlike visions. The reality is often different with failed projects or efforts with negative consequences for social justice and human rights. This situation often leads to angry resistance from multiple groups. What accounts for these different fates? This chapter examines how these efforts develop within a community systems approach and how this accounts for positive and negative outcomes.
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We update the literature on corporate attempts to influence political actors, and thereby shape their governmental outcomes. Doing so allows us to recognize where the field has advanced, where it has not, and, importantly, reimagine an agenda for research moving forward. Our review documents areas of research and levels of analyses within the literature and identifies a core and secondary issues including the overrepresentation of lobbying and campaign contributions, the U.S. context, legislatures as targets of CPA, and firm policy and financial outcomes. We use the review to update the conceptualization of the political marketplace, including the introduction of a new categorization of corporate political activity tactics (CPA) along the dimensions of formality and directness. What we call our political marketplace 2.0 then allows for an expanded agenda for research in the field, moving forward. Our review works together with a companion review on Corporate Political Connections, published in this same issue, to offer a holistic perspective on the boundary between corporations and political actors.
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Although an important feature of firms’ corporate social responsibility (CSR), the strategic pressures behind firms’ corporate philanthropy (CP) are not well researched or understood. This research note argues that firms’ CP and firms’ corporate political activity (CPA) may share common strategic antecedents; forces in firms’ political environment may shape both CP and CPA. Using S&P 500 data in a longitudinal analysis (1997-2004), the authors find evidence suggesting that industry-level political uncertainty increases firm propensity for engaging in both CP and CPA, above and beyond the propensity to engage in either as a stand-alone strategy. The authors use this preliminary evidence to explore political marketplace contingencies for the relationship between CP and CPA. CSR literature indicates that CP can benefit firms by creating and enhancing their relational wealth and institutional legitimacy. Such benefits may also serve firm interactions with government policy makers—a dynamic largely ignored until recently. The authors’ findings may indicate that, due to its institutional signaling ability and impact on firms’ reputations, CP may allow firms to differentiate themselves or stand out from others when faced with political uncertainty, and that these outcomes should be considered when firms engage in CP.
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This essay examines factors that produce political unity among large U.S. corporations advocating free trade. Expanding on old debates, these data and analyses validate the importance of organizational and class cohesion approaches to corporate political action. Methodologically, the political unity of pairs (dyads) of firms in trade policy activism is analyzed with quadratic assignment procedure regression. Shared membership in prominent policy networks and board interlocks positively predict corporate political unity across three areas of trade policy influence, from the executive branch to the legislature. Non-network organizational indicators also significantly predicted corporate trade policy activism. The findings support business unity accounts of corporate political action and suggest that higher levels of firm embeddedness within intercorporate networks facilitate collective corporate political action.
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Full-text available
This article synthesizes the large but diverse literature on organizational legitimacy, highlighting similarities and disparities among the leading strategic and institutional approaches. The analysis identifies three primary forms of legitimacy: pragmatic, based on audience self-interest; moral, based on normative approval; and cognitive, based on comprehensibility and taken-for-grantedness. The article then examines strategies for gaining, maintaining, and repairing legitimacy of each type, suggesting both the promises and the pitfalls of such instrumental manipulations.
Article
Since Mancur Olson's Logic of Collective Action (1965), it is impossible for political scientists to conceive of political participation without reference to his powerful argument linking numbers of participants, public goods, and participatory outcomes. What is puzzling is the poor empirical support for this argument in the domain where it should work best, namely explaining business political activity. Olson thought his arguments principally applicable to economic groups, and for the empirical development of his arguments Olson drew heavily on business interests, the most active segment of the interest group community. We explore these arguments with business political activities data by examining the statistical performance of various measures of market structure in determining business political activity, and find little empirical support. We do offer an alternative basis for business behavior lodged in both private and collective goods that preserves business rationality and also helps explain not only the amount of business political participation but the modes of business participation.
Book
In this tour de force, authors Stewart R. Clegg, David Courpasson, and Nelson Phillips provide a comprehensive account of power and organizations, unlocking power as the central relation of modern organizations and society. The authors present an excellent synthesis of organization, social and political theory to offer an overview of power and organizations that is historically informed, addresses current issues, and is comprehensive in scope.
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Nonprofit Organizations advocate for the poor, the disenfranchised and the oppressed. This process is thought to build social capital and civil society, while engendering the development of social skills and deliberation. In recent years, scholars have observed that nonprofit advocacy organizations have moved from membership associations to professionalized policy change organizations. Virtual advocacy will move the process farther a field. Astroturf, the creation of synthetic advocacy efforts, continues this process further. All of this has troubling implications for nonprofit organizations and nonprofit theory. This paper describes the astroturf phenomenon, reviews pertinent nonprofit theory and speculates on the impact of astroturf for society and the further development of nonprofit theory.
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This book examines anti-corporate activism in the United States, including analysis of anti-corporate challenges associated with social movements as diverse as the Civil Rights Movement and the Dolphin-Safe Tuna Movement. Using a unique dataset of protest events in the United States, the book shows that anti-corporate activism is primarily about corporate policies, products, and negligence. Although activists have always been distrustful of corporations and sought to change them, until the 1970s and 1980s, this was primarily accomplished via seeking government regulation of corporations or via organized labor. Sarah A. Soule traces the shift brought about by deregulation and the decline in organized labor, which prompted activists to target corporations directly, often in combination with targeting the state. Using the literatures on contentious and private politics, which are both essential for understanding anti-corporate activism, the book provides a nuanced understanding of the changing focal points of activism directed at corporations.
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Although ‘grassroots’ conjures up images of independent citizen organizing, much mass participation today is sponsored by elite consultants working for corporations and powerful interest groups. This book pulls back the curtain to reveal a lucrative industry of consulting firms that incentivize public activism as a marketable service. Edward Walker illustrates how, spurred by the post-sixties advocacy explosion and rising business political engagement, elite consultants have deployed new technologies to commercialize mass participation. Using evidence from interviews, surveys and public records, Grassroots for Hire paints a detailed portrait of these consultants and their clients. Today, Fortune 500 firms hire them to counter-mobilize against regulation, protest or controversy. Ironically, some advocacy groups now outsource organizing to them. Walker also finds that consultants are reshaping both participation and policymaking, but unethical ‘astroturf’ strategies are often ineffective. This pathbreaking book calls for a rethinking of interactions between corporations, advocacy groups, and elites in politics.
Book
Many societies use labor market coordination to maximize economic growth and equality, yet employers’ willing cooperation with government and labor is something of a mystery. The Political Construction of Business Interests recounts employers’ struggles to define their collective social identities at turning points in capitalist development. Employers are most likely to support social investments in countries with strong peak business associations, that help members form collective preferences and realize policy goals in labor market negotiations. Politicians, with incentives shaped by governmental structures, took the initiative in association-building and those that created the strongest associations were motivated to evade labor radicalism and to preempt parliamentary democratization. Sweeping in its historical and cross-national reach, the book builds on original archival data, interviews and cross-national quantitative analyses. The research has important implications for the construction of business as a social class and powerful ramifications for equality, welfare state restructuring and social solidarity.
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What are the political motivations behind firms' decisions to adopt policies that self-regulate their behavior in a manner that is beyond compliance with state, federal and local law? Public Forces and Private Politics in American Big Business advances a new understanding of the firm as a political actor that expands beyond the limited conceptualizations offered by economists and organization theorists. Timothy Werner develops a general theory of private politics that is tested using three case studies: the environment, gay rights and executive compensation. Using the conclusions of these case studies and an analysis of interviews with executives at 'Fortune 500' firms, Werner finds that politics can contribute significantly to our understanding of corporate decision-making on private policies and corporate social responsibility in the United States.
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Every industrial nation in the world guarantees its citizens access to essential health care services-every country, that is, except the United States. In fact, one in eight Americans-43 million people-do not have any health care insurance at all. This book offers a history of America's failed efforts to address the health care needs of its citizens. Covering the entire twentieth century, it shows how each attempt to enact national health insurance was met with fierce attacks by powerful stakeholders, who mobilized their considerable resources to keep the financing of health care out of the government's hands. The author describes how, at first, physicians led the anti-reform coalition, fearful that government entry would mean government control of the lucrative private health care market. Doctors lobbied legislators, influenced elections by giving large campaign contributions to sympathetic candidates, and organized "grassroots" protests, conspiring with other like-minded groups to defeat reform efforts. As the success of Medicare and Medicaid in the mid-century led physicians and the AMA to start scaling back their attacks, the insurance industry began assuming a leading role against reform that continues to this day.
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This paper provides a theory of private politics in which an activist seeks to change the production practices of a firm for the purpose of redistribution to those whose interests it supports. The source of the activists's influence is the possibility of support for its cause by the public. The paper also addresses the issue of corporate social responsibility by distinguishing among corporate redistribution as motivated by profit maximization, altruism, and threats by the activist. Private politics and corporate social responsibility not only have a direct effect on the costs of the firm, but also have a strategic effect by altering the competitive positions of firms in an industry. From an integrated-strategy perspective the paper investigates the strategic implications of private politics and corporate social responsibility for the strategies of rival firms when one or both are targets of an activist campaign. Implications for empirical analysis are derived from the theory.
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Beginning in 1938, some American business groups campaigned to repeal the Sixteenth Amendment and limit the federal taxation of income and wealth. Although their proposed upward-redistributive policy would benefit few voters, it won the support of 31 state legislatures. To explain this outcome, this article offers a theory of strategic policy crafting by advocacy groups. Such groups may succeed even in otherwise unfavorable institutional environments if they craft their proposals to fit the salient policy context. Archival evidence and event history analysis support this hypothesis. Public opinion also helps explain legislative support for upward-redistributive policy.
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Corporate foundations - entities established to regularize corporate giving at an arm's length removed from the firm - command substantial resources, root companies in the nonprofit sectors of their host communities, indirectly augment perceptions of corporate responsibility, and help firms to deflect controversies in an attentive global media environment. Despite these important roles, relatively little research has examined the institutional and strategic factors that influence such proximate charitable giving by firms. Using systematic data on foundations linked to S&P 3000 firms in the health sector - a growing domain in which public trust in high-stakes products and services is critical - fixed-effects models illustrate the primary role of network influences on giving: corporate foundations give substantially more in years following higher contributions by other (noncorporate) foundations in the health sector in a firm's headquarters locality and also following increased contributions by industry peers through their corporate foundations. Giving also appears to reflect strategic reputational concerns, in that foundation contributions increase significantly following controversies associated with the corporate parent's products and/or services. By contrast, giving tends to decline as the presence of outside directors on a firm's board increases, as well as when firms carry heavier debt loads. Combined, these findings suggest that corporate foundations serve as a strategic proxy for the firm, reflecting both a company's position in community and interfirm networks while also mitigating the threat of reputational challenges.
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"Can a country be a democracy if its government only responds to the preferences of the rich? In an ideal democracy, all citizens should have equal influence on government policy--but as this book demonstrates, America's policymakers respond almost exclusively to the preferences of the economically advantaged. Affluence and Influence definitively explores how political inequality in the United States has evolved over the last several decades and how this growing disparity has been shaped by interest groups, parties, and elections. With sharp analysis and an impressive range of data, Martin Gilens looks at thousands of proposed policy changes, and the degree of support for each among poor, middle-class, and affluent Americans. His findings are staggering: when preferences of low- or middle-income Americans diverge from those of the affluent, there is virtually no relationship between policy outcomes and the desires of less advantaged groups. In contrast, affluent Americans' preferences exhibit a substantial relationship with policy outcomes whether their preferences are shared by lower-income groups or not. Gilens shows that representational inequality is spread widely across different policy domains and time periods. Yet Gilens also shows that under specific circumstances the preferences of the middle class and, to a lesser extent, the poor, do seem to matter. In particular, impending elections--especially presidential elections--and an even partisan division in Congress mitigate representational inequality and boost responsiveness to the preferences of the broader public.
Article
Politically active individuals and organizations make huge investments of time, energy, and money to influence everything from election outcomes to congressional subcommittee hearings to local school politics, while other groups and individual citizens seem woefully underrepresented in our political system.The Unheavenly Chorusis the most comprehensive and systematic examination of political voice in America ever undertaken--and its findings are sobering. The Unheavenly Chorusis the first book to look at the political participation of individual citizens alongside the political advocacy of thousands of organized interests--membership associations such as unions, professional associations, trade associations, and citizens groups, as well as organizations like corporations, hospitals, and universities. Drawing on numerous in-depth surveys of members of the public as well as the largest database of interest organizations ever created--representing more than thirty-five thousand organizations over a twenty-five-year period--this book conclusively demonstrates that American democracy is marred by deeply ingrained and persistent class-based political inequality. The well educated and affluent are active in many ways to make their voices heard, while the less advantaged are not. This book reveals how the political voices of organized interests are even less representative than those of individuals, how political advantage is handed down across generations, how recruitment to political activity perpetuates and exaggerates existing biases, how political voice on the Internet replicates these inequalities--and more. In a true democracy, the preferences and needs of all citizens deserve equal consideration. Yet equal consideration is only possible with equal citizen voice.The Unheavenly Chorusreveals how far we really are from the democratic ideal and how hard it would be to attain it.
Article
Regulatory agencies impose costs and benefits tailored to individual firms through their discretionary enforcement activities. We propose that corporations use political expenditures in part to "flex their muscles" to regulators and convey their willingness to fight an agency's specific determinations in the political arena. Because the signaling function of political expenditures is strategically complex, we derive a formal model wherein we demonstrate the existence of an equilibrium in which (1) large political donors are less compliant than smaller ones, but the bureaucracy monitors them less, and (2) firms with publicly observable problems reduce their political expenditures. We test the empirical implications of the model using plant-level data from the Nuclear Regulatory Commission on the inspection of 63 privately operated nuclear power plants and the political expenditures of their parent companies. We find strong evidence for the first prediction and qualified support for the second.
Article
How do social movements promote diversity and alternative organizational forms? We address this question by analyzing how cooperative enterprise was affected by the Grange - a leading anticorporate movement in the United States during the late nineteenth and early twentieth centuries. State-level analyses across three industries yield three findings. First, the Grange had positive effects on cooperatives and mutuals during the nineteenth-century populist struggles over corporate capitalism. Second, these effects were stronger where corporations counter-mobilized to block challengers' political efforts. Grangers pursued economic organization as an alternative to politics and in response to blocked political access. Third, the Grange continued to foster cooperatives even as populist revolts waned. It did so, however, by buffering cooperatives from problems of group heterogeneity and population change, rendering them less dependent on supportive communities and specific economic conditions. These findings advance research at the movements/organizations interface by documenting movement effects and by isolating different causal pathways through which mobilization, counter-mobilization, and political opportunity shape economic organization. The results also provide economic sociology with new evidence on how social structure moderates economic forces, and help revise institutional analyses of American capitalism by showing how cooperatives emerged as significant, rather than aberrant, elements of the U.S. economy.
Article
American society today is shaped not nearly as much by vast open spaces as it is by vast, bureaucratic organizations. Over half the working population toils away at enterprises with 500 or more employees--up from zero percent in 1800. Is this institutional immensity the logical outcome of technological forces in an all-efficient market, as some have argued? In this book, the first organizational history of nineteenth-century America, Yale sociologist Charles Perrow says no. He shows that there was nothing inevitable about the surge in corporate size and power by century's end. Critics railed against the nationalizing of the economy, against corporations' monopoly powers, political subversion, environmental destruction, and "wage slavery." How did a nation committed to individual freedom, family firms, public goods, and decentralized power become transformed in one century?Bountiful resources, a mass market, and the industrial revolution gave entrepreneurs broad scope. In Europe, the state and the church kept private organizations small and required consideration of the public good. In America, the courts and business-steeped legislators removed regulatory constraints over the century, centralizing industry and privatizing the railroads. Despite resistance, the corporate form became the model for the next century. Bureaucratic structure spread to government and the nonprofits. Writing in the tradition of Max Weber, Perrow concludes that the driving force of our history is not technology, politics, or culture, but large, bureaucratic organizations.Perrow, the author of award-winning books on organizations, employs his witty, trenchant, and graceful style here to maximum effect. Colorful vignettes abound: today's headlines echo past battles for unchecked organizational freedom; socially responsible alternatives that were tried are explored along with the historical contingencies that sent us down one road rather than another. No other book takes the role of organizations in America's development as seriously. The resultant insights presage a new historical genre.
Article
This article explores collective action frames associated with U.S. employer mobilization against unions in the late nineteenth century. The study makes several contributions to the literature on framing processes. First, it emphasizes that the interests and identities of counter-mobilizing elites are no less problematic than those of challengers. The character of labor protest did not in itself dictate how employers would construct the actors and issues at stake in industrial conflict. Second, it adds another explanation for why certain frames prevail, supplementing discussions of strategic framing and frame resonance. From among a larger repertoire of possibilities, proprietary employers adopted those anti-union frames that corresponded with diagnostic categories and identities constructed in other organizational settings. My focus here is on frames deployed in the arenas of municipal reform and status group formation as well as industrial relations. Finally, the case suggests that for elite counter-mobilization, the development of oppositional identities may also involve social closure, as higher status groups construct hierarchies of social honor.
Article
Each of four theoretical traditions in the study of American politics—which can be characterized as theories of Majoritarian Electoral Democracy, Economic-Elite Domination, and two types of interest-group pluralism, Majoritarian Pluralism and Biased Pluralism—offers different predictions about which sets of actors have how much influence over public policy: average citizens; economic elites; and organized interest groups, mass-based or business-oriented. A great deal of empirical research speaks to the policy influence of one or another set of actors, but until recently it has not been possible to test these contrasting theoretical predictions against each other within a single statistical model. We report on an effort to do so, using a unique data set that includes measures of the key variables for 1,779 policy issues. Multivariate analysis indicates that economic elites and organized groups representing business interests have substantial independent impacts on U.S. government policy, while average citizens and mass-based interest groups have little or no independent influence. The results provide substantial support for theories of Economic-Elite Domination and for theories of Biased Pluralism, but not for theories of Majoritarian Electoral Democracy or Majoritarian Pluralism.
Conference Paper
Analysts have shown increased interest in how social movements use tactical repertoires strategically. While the state is most often the guarantor of new benefits, many movements-from labor to the environmental movement-target corporate, educational, and other institutions. Employing a unique data set of protests reported in the New York Times (1960-90), this research examines how repertoires are, in part, contingent on the institutional target a movement selects. In particular, the authors consider the role of each target's vulnerabilities and its capacities for response-repression, facilitation, and routinization-as explanations for the degree of transgressive protest each target faces. The results provide strong evidence for considering targets as a central factor in shaping forms of social protest.
Article
Political sociologists have debated for decades, without resolution, whether elites in advanced capitalists societies are integrated. Rather than ask whether elites are integrated, this study examines the conditions under which convergence of political behavior occurs, focusing on campaign contributions of political action committees in the American business community. A model of similarity in corporate political behavior is proposed that draws on principles developed by resource-dependence and social class theorists of intercorporate relations. The model was supported by an examination of the 1,596 dyads created by relations among 57 large U.S. manufacturing firms in 1980. Membership in the same primary industry or several similar industries, geographical proximity of headquarters locations (but not plant locations), market constraint, and common relations with financial institutions (through either stock ownership or directorate ties) were positively associated with the similarity of political behavior between firms. Market constraint affected the similarity of political behavior primarily because it increased the likelihood that firms would produce in the same industries. The effect of indirect board interlocking throung financial institutions was a stronger predictor of similarity of political behavior than was direct interlocking between manufacturing firms. The findings suggest the simultaneous importance of organizational and social network factors in understanding common political behavior between firms.
Article
Little is known about the factors that influence regulatory agency decision making. We posit that regulatory agencies are influenced by the firms they regulate but not exclusively via dyadic exchanges, as is traditionally argued in the regulatory capture and business-government literatures. Instead, regulatory decisions are indirectly shaped via third-party actors who shield agencies from legitimacy threats. Focusing empirically on the United States Department of Agriculture's (USDA) approval of genetically modified organisms (GMOs), we find that product assessments by powerful stakeholders and peer agencies influence product approval and that their effects vary under different threats. We also discuss the implications of these findings for business-government relations, nonmarket strategy, and organization theory.
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This article suggests corporate public affairs activities can be broken down into two types: activities that ''buffer'' from the social and political environment, and activities that ''bridge'' with that environment. Drawing on previous work related to contingency theory, resource dependence, and strategic management, we developed hypotheses concerning conditions under which firms will emphasize buffering, bridging, or both. The hypotheses were tested with data collected from large American firms and Lohmoller's partial-least-squares latent variable path analysis. Buffering is found to be positively associated with environmental uncertainty and organizational power. Bridging is positively associated with uncertainty and an institution-oriented philosophy on the part of top management.
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This paper provides a model of integrated market and nonmarket strategies in the context of an industry facing regulation that differentially affects the firms in the industry. The regulation is chosen in a majority rule institution, and to affect the stringency of the regulation, the firms in the industry can take nonmarket action in the form of providing support to legislators based on how they vote. The nonmarket action is considered in the context of client and interest group politics, where the latter involves competition with an environmental interest group. An integrated strategy is composed of the firm's strategy for its market environment and its strategy for its nonmarket environment. Also the integrated strategies of the firms must constitute an equilibrium in their market competition and an equilibrium for their nonmarket competition, including that with the environmental interest group. Collective action in the form of coalition building and rent chain mobilization is also considered.
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Strategy involves more than seeking to accomplish goals, innovate, and improve financial performance. We offer a field-theoretic perspective that distills three key dimensions of strategy: the need to accrue and mobilize resources, maintain an organization's status, and achieve greater levels of power and influence. Strategy evolves as actors seek cooperative partners or come into conflict with other actors who hold competing worldviews. Attaining strategic advantages depends greatly on actors' abilities to shape the perceptions of others. Actors must be able to win the public's hearts and minds if they are to gain positions of prominence and to influence the rules of the game that shape who wins or loses. Much strategic action evolves from these contests over shaping key audiences' perceptions. Field theory, in our view, provides a more holistic view of strategy.
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Trade associations are an important topic of investigation for nonprofit and voluntary sector researchers because they serve civic purposes and help to support innovative areas of entrepreneurship. We examine how local trade associations in the emerging gourmet food truck industry help to reduce uncertainty and augment industry legitimacy by (a) representing collective interests when challenged by regulators and incumbents (e.g., restaurants), (b) generating collective identity and creating cultural capital, and (c) providing a regime to manage “tragedies of the commons,” procure club goods, and promote self-regulation. We draw on social media data and narrative accounts by industry activists to explicate the evolution of the field from 2008 to 2012 in 11 cities. Findings suggest that trade associations, as an often-overlooked type of mutual benefit association, are key players in the legitimation of creative industries.
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Firms use political strategies when attempting to influence public policy decisions. One common assumption is that firms' political strategies will be less effective if the public policy issue has widespread interest among a large segment of likely voters - a "widely salient" issue. We explore how information and reputation cascades, driven by activists or nongovernmental organizations, cause public policy issues to become widely salient. We then discuss how firms can prevent the occurrence of such wide-spread salience and how they can respond once an issue has become widely salient.
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This study uses data on the contributions of corporate political action committees to evaluate six popular theories of business political partisanship. Two theories are supported by the data: the "Yankee-Cowboy" theory of regional political differences among U.S. corporations and the regulatory environment theory, which views the differential relationship to government regulation as a primary determinant of corporate political behavior. No support is found for four other theories of business political partisanship: the core-periphery theory, the inner-circle theory, the managerialist theory, and the domestic-multinational theory. The four disconfirmed theories are all variants of a perspective known as the theory of "corporate liberalism," which hypothesizes a tendency toward greater liberalism on the part of the more dominant or central corporations in American society.
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Scholars argue that the state has facilitated the expansion of the financial sector, but focus largely on how politics transforms financial markets. I explore a new political mechanism of financialization, by drawing upon an ethnographic study of economic development in two Rust Belt cities and analyzing usage of tax increment financing (TIF), a practice that allows cities to securitize projected increases in property tax receipts and create bonds similar to structured asset-backed securities (e.g. mortgage-backed securities). Cities initially used TIF as a last-resort financing strategy, but the practice has transformed urban politics by creating opportunities for economic development professionals to exercise jurisdiction over municipal budgets. Further, TIF structures other roles that development professionals play by giving them incentives to use TIF in ways that are not aligned with the city's fiscal outlook and lock them into ever-higher rates of TIF spending. This analysis illustrates a recursive relationship between financialization and the state: public policies have transformed financial markets, but reliance on financial markets can also transform political institutions in ways that promote further financialization.
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The embattled state of U.S. labor has generated a voluminous body of research on the processes of deunionization contributing to its decline. Revisiting the less researched topic of unionization, this study explores the social conditions facilitating union growth during the labor movement's formative years. Focusing on the first decade of the twentieth centuryin many respects for labor, a period not unlike the presentI seek to explain the pattern of organizing success and failure across industries and occupations. I find that the most organized settings occurred where workers had greater disruptive capacities due to the high cost of being replaced during work stoppages. The highest replacement costs were associated with three conditions: scarcity of skilled labor, geographically isolated worksites that raised the cost of importing strikebreakers, and time-sensitive tasks that rendered replacement workers economically impractical. Workplaces that had at least one of these conditions formed the backbone of the early U.S. labor movement. The conclusion considers the impact of declining replacement costs on current challenges facing U.S. labor.
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Drawing on institutional theory, this article considers some of the ways the Hungarian state shapes the organizational structure and behavior of agricultural cooperatives. Fragmentation in the structure of state decision making is hypothesized as leading to (1) more elaborate interorganizational networks; (2) greater competition among similar organizations; and (3) larger administrative components. Analysis of survey data from the managers of cooperatives provides evidence supporting the hypotheses about networks and competition but contradicting the hypothesis about administrative overhead.
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This paper proposes an alternative to resource-dependence approaches to strategic behavior, which predict that actors seek direct cooptive relations to alleviate constraint. I propose that an actor can gain leverage on a limiting party by building a cooptive relation with a player that may control this party's behavior, thus using two-step leverage. Data on dependence relations, political alliances, and confidential discussion networks among decision makers in a cooperative agribusiness furnish evidence of both direct and two-step leverage and clarify the contexts in which these two strategies are used. As predicted by the resource-dependence approach, leaders build ties of interpersonal obligation with people directly affecting their performance in the organization. When policy divergences or personal frictions make these ties untenable, however, leaders build strong cooptive relations with people who may constrain the performance of the party on whom they depend. Based on these results, I discuss an extension of resource-dependence theory and explore the potential uses of two-step leverage mechanisms in organizational politics.
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Private interest representatives in Washington are often said to exploit prior experience with the federal government, especially their contacts with officials, to gain advantage for their client groups. Data on 776 interest representatives are examined to estimate the frequency and institutional location of prior governmental experience. Just over half of the respondents had had some such service; twice as many in the executive branch as in the milieu of Capitol Hill. For those with experience, the extent and character of its advantages for their work as lobbyists are assessed. In general, representatives assign greater value to the knowledge gained of both substantive policy and decision-making processes than to contacts with officials or other lobbyists.
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Pluralists argue that corporations with different economic interests and market orientations are incapable of collective political strategy and actions, while class theorists argue that corporations have sufficient class interests to evolve a collective political class strategy. We examined this controversy using a variant of clique detection methods for business Political Action Committee (PAC) contributions to Congressional candidates in the 1980 election. One large group of corporations emerged based on shared conservative beliefs. No other groups nearly as large were detected. The findings were strong and robust for different levels of political similarity. The identified groups differed from each other economically in various ways, but these differences were not nearly as marked as the political differences. Overall, the evidence lends stronger support to the class rather than the pluralist perspective.
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Widespread access to public records of campaign contributions by corporate political action committees (PACs) have made these the preferred data for analyzing political partisanship within the capitalist class. By comparison, data on political contributions by individual capitalists were, until recently, difficult to obtain and rarely subjected to systematic study. Important differences are demonstrated between these two forms of capitalist political action by directly comparing the campaign contributions of 592 individual capitalists with the contributions of the 394 major corporations with which those capitalists were associated. Campaign contributions by individual capitalists follow a logic different from that of corporate PACs. Corporations are generally more interested in buying influence with incumbents, while individual capitalists are more concerned with bolstering the election prospects of favored candidates. By providing a more direct measure of capitalists' political preferences, the analysis of campaign contributions by individual capitalists clarifies theoretical questions that remain unresolved in the research based on corporate PACs. Variables that elude measurement when corporations are the units of analysis (e.g., ethnicity) are shown to have important consequences for capitalist political partisanship.
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In this article the effects of special-interest campaign contributions, party, and constituency (mediated by issue visibility on prolabor and probusiness legislative outcomes) are examined for the 99th Congress. Labor contributions have marginally greater impact than business contributions on legislative outcomes, although labor money “counts” less for high-visibility labor issues. Labor money also has more of an impact against probusiness voting. Party is the most important predictor of legislative outcomes and is not conditioned by issue visibility. One interpretation of the findings is that labor is marginally better than business in achieving its goals. An alternative interpretation is that business has less of a stake than labor in legislative outcomes because of its greater involvement in politics outside of the electoral process, which partly explains labor's success on some issues of marginal importance and its failure on more significant ones.
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The vesting of interests is defined as the extent to which a government agency takes the interests of a nongovernmental actor into account in policy making and routine administration. There was a change in the distribution of economic interests vested in the U.S. State Department, as it bureaucratized during the period 1886-1905. The primary bureaucratic developments were growth in size, appointment and promotion on the basis of merit, and organizational differentiation. Analysis of data collected and by-content analysis of intradepartmental correspondence shows that the interests of the financial-industrial core industries became more vested, while those of affiliated industries and peripheral industries were stable or decreased. Moreover, the types of documents most characteristic of bureaucratic organization inordinately vested core interests. It is concluded that bureaucratization affected the pattern of vested interests through the institutionalization of particular tasks in routine administration.
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Since the 1960s, interest group scholars have suggested that groups mostly lobby legislators who, prior to lobbying, are expected to support their favored positions. We present theoretical and empirical evidence that, other things being equal, groups also lobby legislators who are predisposed to vote against their favored positions. We find that when groups lobby their ex ante supporters, they do so to counteract the influence of opposition groups. On the basis of our findings, we argue that organized interests play a much more prominent and substantial role in the legislative process than past research indicates.
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The unexpected investment decisions of companies during recessions often frustrate commentators and policy makers who view the economy from the top down. Companies may act against immediate market signals during recessions because of uncertainties about strategy and the future direction of the economy. A mesolevel sociological model of how firms interpret and respond to economic conditions in uncertain times improves understanding of firms’ variable responses to recessions, which cumulatively shape macroeconomic trajectories. Examining firm-level employment during four recessions from 1950 to 1970, the author generates results from dynamic panel models to show that firms set their employment levels against profits and market share and in alignment with peers and political affiliations. Firms manage uncertainty by imitating peers but also by endeavoring to construct their environment collectively through business associations. This article’s counterintuitive economic findings and the evidence of social and political influences reinforce the importance of careful investigation into how firms respond to recessions.
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According to one common theory of business power, politicians face strong electoral incentives to implement policies matching the preferences of business enterprises. The tendency for investors to choose the time and place producing the highest returns supposedly weakens or eliminates the ability of ordinary citizens to provide direction for policymakers. If the theory is accurate, substantive public input into policymaking should suffer the most during economic downturns, when officeholders are most dependent upon additional investment. Building upon recent work examining representation over time, I test the theory's predictions within the United States using time-series regression. The data set includes measures of public opinion, elections, and a broad range of federal legislative decisions important to the business community at large. Contrary to the theory's expectations, the results indicate that representation in the U.S. is not impaired by linkages between the economy and elections. Flaws in the theory's underlying assumptions show why trepidation about the structural power of business is misplaced.