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Abstract

Recent research has called for institutional approaches to help surpass the limitations of structural growth models in accounting for regionally specific development paths. The region of Heilbronn-Franconia in Baden-Württemberg is one such puzzling case for its economic and industrial structure is inconsistent with extant models, and yet the region represents one of the most prosperous economies with the highest concentration of hidden champions in Germany. This paper explores the institutions –patterns of social interactions and underlying beliefs – that characterize entrepreneurial practices on the levels of the firm, inter-firm and civic relations of this rural region. Based on a mixed-methods approach, including 132 interviews with managers and a survey of firms in strategic sectors, we unveil the interaction patterns of ‘life-long engagement’, ‘tinkering’, ‘doing’, ‘leadership networking’, and ‘civic engagement’ as well as the underlying beliefs that inform these patterns, as the institutions that are coherent with a particular mode of continuous innovation and entrepreneurial stamina. We conclude by proposing the hourglass model as the institutional morphology of rural industrialism.

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... Recent research in Heilbronn-Franconia showed that local firms preferred to solve their problems in-house, purposively adopted a model of ʺclosed innovationʺ, and shied away from cooperation for cost and secrecy concerns [79,80]. Consistent with the qualitative insights obtained in previous research, we found inter-firm collaboration in the innovation process not very prominent in Heilbronn-Franconia. ...
... The literature on territorial servitization suggests that SMEs often lack potential partners in their home region or the willingness of partners to engage in innovation collaboration; services related to R&D are markedly regionally underrepresented [65]. A considerable number of firms in the region were found to deny inter-firm cooperation because of secrecy concerns [79]. Although our research design did not permit us to evaluate the ʺmatchingʺ qualities or an ʺadequate organizational fitʺ between the local firms [59,61], our findings support the conclusion that being co-located did not seem to determine successful cooperation. ...
... In the case of our study region, regional actors, such as the Chamber of Commerce and Industry or the regional development agency, take important roles in building such a relational infrastructure. Because informal networks are strong within the region [79], policy makers could address regional stakeholders to spread and legitimize best-practices of cooperation. Exchange platforms can provide SMEs with access to potential partners. ...
Article
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Customers increasingly prefer the provision of comprehensive solutions over buying goods and services separately. Whereas researchers have closely studied the servitization of large manufacturers, the situation of small and medium sized firms as well as of services firms has been neglected. In contrast to the one-sided view of servitization, we propose a comprehensive view of hybridity to capture the transformation of firms from pure to hybrid products and to focus on SMEs across a wide range of sectors. Based on a survey of 190 SMEs in a highly industrialized southern German region, we find hybrid firms to be more likely than pure firms—both manufacturing and service firms—to engage in a higher scale and scope of innovation activities, to use absorptive capabilities in the appropriation of external knowledge, and to collaborate with partners in the innovation process. We argue that collaboration offers a sustainable path towards hybridity for SMEs, and that territorial hybridity can be a viable path for regions towards sustainable development.
... However, the concept of relational infrastructure enables making institutions visible, based on the idea that "because institutions are means of providing regularity to behaviour, they are always underpinned by networks of persons" (Storper, 2018, 213). Although institutions are not reducible to their networks, it is these inter-personal and inter-organisational linkages that enable the communication and alignment of social norms and legitimate beliefs, and help visualise the establishment of corresponding interaction patterns as observable manifestations of institutions (Glückler, Punstein, Wuttke, & Kirchner, 2020;Storper, 2018). For example, Storper (2018) found that the more successful development of the San Francisco Bay Area compared to Greater Los Angeles was due to the former's relational infrastructure, comprised of informal networks, elite leadership networks, cross-network connections, and organisational sites that facilitate and sustain such crossover links. ...
... For example, Storper (2018) found that the more successful development of the San Francisco Bay Area compared to Greater Los Angeles was due to the former's relational infrastructure, comprised of informal networks, elite leadership networks, cross-network connections, and organisational sites that facilitate and sustain such crossover links. In applying the framework of relational infrastructure, Glückler et al. (2020) were also able to explain the otherwise inexplicable economic success of the German region of Heilbronn-Franconia, based on strong firm-internal bonds, disconnection in terms of work collaboration between firms, but cohesive non-business networks within the home region. ...
... Previous research has showed that Basque family entrepreneurs actively participate in these cultural activities together with their local community (Lenz and Glückler, 2020). Thus, the relational infrastructure of traditional Basque family firms can be described similarly to what Glückler et al. (2020) found for the region of Heilbronn-Franconia: little connection between firms in terms of collaboration, but a cohesive non-business network within the local community, and strong intra-firm relations due to pronounced family logics as guiding principles. ...
Book
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This book explores the relationship between families, firms, and regions and the extent to which these relationships contribute to regional economic and social development.
... However, the concept of relational infrastructure enables making institutions visible, based on the idea that "because institutions are means of providing regularity to behaviour, they are always underpinned by networks of persons" (Storper, 2018, 213). Although institutions are not reducible to their networks, it is these inter-personal and inter-organisational linkages that enable the communication and alignment of social norms and legitimate beliefs, and help visualise the establishment of corresponding interaction patterns as observable manifestations of institutions (Glückler, Punstein, Wuttke, & Kirchner, 2020;Storper, 2018). For example, Storper (2018) found that the more successful development of the San Francisco Bay Area compared to Greater Los Angeles was due to the former's relational infrastructure, comprised of informal networks, elite leadership networks, cross-network connections, and organisational sites that facilitate and sustain such crossover links. ...
... For example, Storper (2018) found that the more successful development of the San Francisco Bay Area compared to Greater Los Angeles was due to the former's relational infrastructure, comprised of informal networks, elite leadership networks, cross-network connections, and organisational sites that facilitate and sustain such crossover links. In applying the framework of relational infrastructure, Glückler et al. (2020) were also able to explain the otherwise inexplicable economic success of the German region of Heilbronn-Franconia, based on strong firm-internal bonds, disconnection in terms of work collaboration between firms, but cohesive non-business networks within the home region. ...
... Previous research has showed that Basque family entrepreneurs actively participate in these cultural activities together with their local community (Lenz and Glückler, 2020). Thus, the relational infrastructure of traditional Basque family firms can be described similarly to what Glückler et al. (2020) found for the region of Heilbronn-Franconia: little connection between firms in terms of collaboration, but a cohesive non-business network within the local community, and strong intra-firm relations due to pronounced family logics as guiding principles. ...
... However, the concept of relational infrastructure enables making institutions visible, based on the idea that "because institutions are means of providing regularity to behaviour, they are always underpinned by networks of persons" (Storper, 2018, 213). Although institutions are not reducible to their networks, it is these inter-personal and inter-organisational linkages that enable the communication and alignment of social norms and legitimate beliefs, and help visualise the establishment of corresponding interaction patterns as observable manifestations of institutions (Glückler, Punstein, Wuttke, & Kirchner, 2020;Storper, 2018). For example, Storper (2018) found that the more successful development of the San Francisco Bay Area compared to Greater Los Angeles was due to the former's relational infrastructure, comprised of informal networks, elite leadership networks, cross-network connections, and organisational sites that facilitate and sustain such crossover links. ...
... For example, Storper (2018) found that the more successful development of the San Francisco Bay Area compared to Greater Los Angeles was due to the former's relational infrastructure, comprised of informal networks, elite leadership networks, cross-network connections, and organisational sites that facilitate and sustain such crossover links. In applying the framework of relational infrastructure, Glückler et al. (2020) were also able to explain the otherwise inexplicable economic success of the German region of Heilbronn-Franconia, based on strong frm-internal bonds, disconnection in terms of work collaboration between frms, but cohesive non-business networks within the home region. ...
... Previous research has showed that Basque family entrepreneurs actively participate in these cultural activities together with their local community (Lenz and Glückler, 2020). Thus, the relational infrastructure of traditional Basque family frms can be described similarly to what Glückler et al. (2020) found for the region of Heilbronn-Franconia: little connection between frms in terms of collaboration, but a cohesive non-business network within the local community, and strong intra-frm relations due to pronounced family logics as guiding principles. ...
Chapter
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Family firms have multiple nodes that connect them with the regions in which they are located, for example providing jobs and professional training, paying taxes, and engaging in regional philanthropy. The regional anchoring of family firms thus plays an important role in regional economies and, especially, in rural ones. In this sense, family firms’ transgenerational continuity is essential to keeping the regional link stable over time. However, family firm succession threatens not only firm survival but also regional stability. In this sense, the topic of family firm succession has received less academic and policy attention in terms of their regional ties across generations. To begin addressing this issue, I wonder whether successors have the same regional bonds as their predecessors. To investigate how succession affects the regional anchoring of family firms, this chapter analyses the characteristics of successors, their network connections, and their beliefs on how to do business. Based on a qualitative approach and through the lens of an institutional perspective, I explore case studies of successors in Basque family firms and analyse differences in the attitudes and behaviours between predecessors and successors. These differences indicate that successors have weaker regional embedding than their predecessors – i.e., the existence of regional dis-embedding process. This chapter discusses the potential consequences of family firm dis-embedding for regions and their economic development.
... However, the concept of relational infrastructure enables making institutions visible, based on the idea that "because institutions are means of providing regularity to behaviour, they are always underpinned by networks of persons" (Storper, 2018, 213). Although institutions are not reducible to their networks, it is these inter-personal and inter-organisational linkages that enable the communication and alignment of social norms and legitimate beliefs, and help visualise the establishment of corresponding interaction patterns as observable manifestations of institutions (Glückler, Punstein, Wuttke, & Kirchner, 2020;Storper, 2018). For example, Storper (2018) found that the more successful development of the San Francisco Bay Area compared to Greater Los Angeles was due to the former's relational infrastructure, comprised of informal networks, elite leadership networks, cross-network connections, and organisational sites that facilitate and sustain such crossover links. ...
... For example, Storper (2018) found that the more successful development of the San Francisco Bay Area compared to Greater Los Angeles was due to the former's relational infrastructure, comprised of informal networks, elite leadership networks, cross-network connections, and organisational sites that facilitate and sustain such crossover links. In applying the framework of relational infrastructure, Glückler et al. (2020) were also able to explain the otherwise inexplicable economic success of the German region of Heilbronn-Franconia, based on strong firm-internal bonds, disconnection in terms of work collaboration between firms, but cohesive non-business networks within the home region. ...
... Previous research has showed that Basque family entrepreneurs actively participate in these cultural activities together with their local community (Lenz and Glückler, 2020). Thus, the relational infrastructure of traditional Basque family firms can be described similarly to what Glückler et al. (2020) found for the region of Heilbronn-Franconia: little connection between firms in terms of collaboration, but a cohesive non-business network within the local community, and strong intra-firm relations due to pronounced family logics as guiding principles. ...
... However, the concept of relational infrastructure enables making institutions visible, based on the idea that "because institutions are means of providing regularity to behaviour, they are always underpinned by networks of persons" (Storper, 2018, 213). Although institutions are not reducible to their networks, it is these inter-personal and inter-organisational linkages that enable the communication and alignment of social norms and legitimate beliefs, and help visualise the establishment of corresponding interaction patterns as observable manifestations of institutions (Glückler, Punstein, Wuttke, & Kirchner, 2020;Storper, 2018). For example, Storper (2018) found that the more successful development of the San Francisco Bay Area compared to Greater Los Angeles was due to the former's relational infrastructure, comprised of informal networks, elite leadership networks, cross-network connections, and organisational sites that facilitate and sustain such crossover links. ...
... For example, Storper (2018) found that the more successful development of the San Francisco Bay Area compared to Greater Los Angeles was due to the former's relational infrastructure, comprised of informal networks, elite leadership networks, cross-network connections, and organisational sites that facilitate and sustain such crossover links. In applying the framework of relational infrastructure, Glückler et al. (2020) were also able to explain the otherwise inexplicable economic success of the German region of Heilbronn-Franconia, based on strong firm-internal bonds, disconnection in terms of work collaboration between firms, but cohesive non-business networks within the home region. ...
... Previous research has showed that Basque family entrepreneurs actively participate in these cultural activities together with their local community (Lenz and Glückler, 2020). Thus, the relational infrastructure of traditional Basque family firms can be described similarly to what Glückler et al. (2020) found for the region of Heilbronn-Franconia: little connection between firms in terms of collaboration, but a cohesive non-business network within the local community, and strong intra-firm relations due to pronounced family logics as guiding principles. ...
... Still, although behaviour needs to be distinguished from institutions, both are related because institutions not practiced can vanish in the long term and codifications of rules that are ignored by agents can hardly qualify as institutions (Hodgson, 2006; see also Bathelt & Glückler, 2014;. The link between institutions, formal rules and policies, and informal conventions (Dupuy et al., 1989;Hodgson, 2006;North, 1990;Salais & Storper, 1992) is marked by contingency (Bathelt & Glückler, 2003, 2014 as different relationships between formal rules or policies and practiced institutions including reinforcement, substitution, circumvention, competition, coherence, compatibility, or complementarity can ensue (Bathelt & Glückler, 2014;Boyer, 2005;Glückler, 2020;Glückler et al., 2020;Glückler & Lenz, 2016;Zukauskaite et al., 2017). These contingent relationships bring with them contested processes of rule or policy implementation and related institutional leeway that accounts for the actual, partial, modified, or lacking transformation of rules and policies into institutions (Hall & Thelen, 2009; see also Streeck & Thelen, 2005). ...
... Patterns of institutional change are contingent on the context at hand (Bathelt & Glückler, 2003, 2014. For example, incremental institutional change plays a prominent role in a system that Glückler et al. (2020) describe as the 'hourglass model' marked by strong intra-firm relations, weak inter-firm relations, and strong regionallevel networks, while a context marked by firm succession as in the Basque Country and Baden-Württemberg (Lenz & Glückler, 2021) could provide a peculiar opportunity for radical institutional change. ...
Article
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Evolutionary economic geography has sought to understand the development of regional industrial pathways but tended to neglect both the multiscalarity of economic development and the role of institutional change. The concept of coevolution seeks to bridge this gap but is still too vague for empirical application. Understanding the interactions between path development and institutional change in regional economies and on higher spatial scales requires retheorizing coevolution along the dimensions of institutional–industrial coevolution, path multiplicity and multiscalarity. The article proposes such a retheorized concept of coevolution by integrating concepts of path development, institutions, institutional change, institutional entrepreneurship, institutional work and nestedness.
... For one thing, formal variable-centred methods, such as regression models, rarely reveal the causative mechanisms that underpin and have generated statistical associations. To investigate those mechanisms will require detailed tracing of the behaviours, decisions, and contexts of the actors, organizations and institutions involved, which investigation is likely to be qualitative in nature (see, for example, Glückler et al, 2020). For another thing, sometimes the only historical information available on the emergence and development of particular firms, industries or technologies will be of a largely qualitative kind. ...
Article
Our focus in this paper is on a somewhat curious feature of evolutionary economic geography, namely that although concerned with evolution – with processes of historical change and transformation – evolutionary economic geography seems not to take history as seriously as it would be expected to do. We argue that evolutionary economic geography is inescapably an historical social science, and that as such would benefit from exploring the different ways in which history can be used in causal investigation, from problematising the different temporalities of economic change and transformation, and from giving more attention to appreciative theorising and narrative case study over variable-centred approaches.
... It is the region with the second-fastest economic growth in Germany since 2000 (Glückler, Schmidt, & Wuttke, 2015). Its economic structure is based on an internationally competitive manufacturing industry, a high density of world market leaders, and a nationwide above-average income of the region's 900,000 inhabitants (Glückler, Punstein, Wuttke, & Kirchner, 2020). In pursuit of an extensive exploration of the composition, activity, connectivity, and geography of the philanthropic field in the region, we adopted a mixed-methods research design with which we combined qualitative and quantitative methods for the collection of primary and secondary empirical observations (Table 9.1). ...
Chapter
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Drawing on the neo-institutional notion of organizational fields, we propose the concept of the philanthropic field to conceptualize the geography of giving and the interrelations of benevolent activities across the domains of private, public, and civic sectors. Empirically, we adopt a multi-method approach, including a media analysis of reported acts of giving in the German region of Heilbronn-Franconia, a social network analysis of its regional philanthropic relations, and qualitative interviews with representatives of non-profit organizations, corporations, and public as well as private intermediaries. Based on our analysis, we conclude that the philanthropic field is constituted by diverse actors from all sectors of society who engage in specialization, division of labor, and collaboration. Moreover, practices of giving spread across geographical scales, though the majority of activity concentrates on the local and regional level. We conclude by discussing the potentials and limits of our approach as a means to gain insights into local fields of philanthropy and benevolent action across societal sectors.
... The production of simpler and less technologically intensive products for which it is realistic to find intermediate product suppliers in rural areas and/or which have a low unit price and thus expensive transport costs over longer distances; and d. Custom-made, non-standardised products that require intense personal contacts with suppliers, thus benefitting from the geographical proximity of suppliers (Amin and Malmberg, 1992;Glückler et al., 2020). ...
Article
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Various types of manufacturing firms located in rural municipalities are identified in this paper, and we determine the intensity of their economic linkages at the local and regional levels. We also examine the factors affecting the intensity of local/regional sourcing and purchasing. Due to the unavailability of detailed economic data at the municipal level, our research draws on a case study of 26 rural manufacturing small/medium-sized enterprises located in the Zlín Region in the eastern part of the Czech Republic. As a highly industrialised region, Zlín should theoretically provide a very favourable environment for the development of local/regional productive linkages of rural manufacturing firms. Several non-parametric tests have been employed to test the effects of firm size, age, industry and location, on the intensity of local and regional purchasing/sourcing. We found the most common firms are those that purchase and sell mostly on a regional (NUTS3) level rather than on the local level. Small firms source and sell more locally than larger firms. Effects of the firm age, industry and location, on the intensity of local/regional sourcing and purchasing were not confirmed.
... It helps actors to assign roles and responsibilities in governance processes. Knowing the institutional context Glückler, Punstein, Wuttke, & Kirchner, 2020) allows actors to establish governance practices that are coherent or complementary with legitimate mutual expectations (Boyer, 2005). Institutions provide and impart knowledge for governance in their own specific way. ...
Chapter
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Governance is both a contested concept and an increasingly empirical concern. On the one hand, it has become an almost universal and all-encompassing concept, which has attracted scholarly interest from many disciplines and over many decades to tackle the dilemmas of collective action and to facilitate effective coordination of interests and resources toward commonly accepted goals. On the other hand, conceptions of governance vary considerably, and their meanings depend on disciplinary perspectives, theoretical traditions, and empirical focus. Although it is easy to agree what governance is not, it is more challenging to create broad consensus on what it is and how it works effectively. Most capaciously, governance denotes the coordination of collective action. These actions take place in institutionally or physically organized spaces of interaction, where knowledge is needed to shape governance appropriately. Organized spaces and knowledge are both conditions as well as consequences of the governance process.
... Yet, although institutions are almost unanimously accepted as a major determinant of development (e.g., Amin & Thrift, 1995;Gertler, 2010;Rodríguez-Pose, 2013;Rodrik et al., 2004), their inner workings still very much remain a mystery. New efforts are needed to bring to the fore the mechanisms at play in this relationship (e.g., Dawley, Mackinnon, & Pollock, 2019;Glückler, Punstein, Wuttke, & Kirchner, 2019;Huggins & Thompson, 2015). Comparative research designs involving case studies are perhaps the most effective way of getting to grips with the linkages between urban and regional growth and the influence of institutions (e.g., Safford, 2009;Storper, Kemeny, Makarem, & Osman, 2015), direct or otherwise, but require strong theoretical underpinnings to arrive at more generalizable conclusions in lieu of large sample studies. ...
Article
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Regions and cities face unceasing pressures to adapt in response to processes of globalisation, changes in industrial production, and new patterns of migration and trade. At the same time, the dominant development policies are proving less than capable of providing answers to these challenges. Strategies based on a mix of physical and human capital and technology have not succeeded in dealing with growing territorial inequality and its treacherous economic, social and political consequences. There is thus an urgent need to understand why territorial divergence occurs and why there is what seems to be a growing decline in the returns of public intervention targeting economic development. In search for answers, scholars have turned to the examination of institutions. But despite progress in our grasp of how institutions affect development, crucial knowledge gaps remain. This paper reviews recent progress in our understanding of the role of institutions for development, unveils the most important gaps, and proposes a series of avenues to improve how a better understanding of how institutions shape regional and urban development can lead to more efficient development policies.
... The framework of the institutional context invites scholars to think beyond strategic plans, organizational structures, jurisdictional boundaries, and governance systems. Instead, scholars interested in institution-sensitive placed-based policies will have to expand their analytical view to the actions of institutional entrepreneurs (Garud et al., 2007), to the quality and structure of regional networks (Storper et al., 2015), and the specific "institutional morphology" (Glückler, Punstein, Wuttke, & Kirchner, 2019) of stable patterns of interactions in a particular setting. By taking such a comprehensive perspective, regional analysis, and policy makers will be able to respond to idiosyncratic societal conditions and to detect the convergent and divergent effects of an institutional context on a policy blueprint. ...
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A key problem of downscaling or transferring policies across regions is embedding these policies into a place for them to unleash the full potential of regional economies. This paper elaborates on the analytical framework of “institutional context” to bridge the gap between rich theorizations and poor empirical capture of institutions in studies of regional development. The institutional context is constituted by three pillars—regulations, organizations, and institutions—as well as by the interrelations between these pillars. Applied to the British region of Coventry and Warwickshire, a qualitative analysis of expert interviews finds institutional patterns of short‐termism, moderate levels of social capital and an embryonic relational infrastructure to constrain the place‐based strategy for industrial diversification. This regional case illustrates the more general challenge for regional policy in the UK of devising place‐based strategies under conditions of continuous rescaling of regional governance and the implementation of a new National Industrial Strategy. In conclusion, the analysis suggests a shift from “nodal” to “linking” policies that support cross‐network connections and help grow a regional field for collective action to cross‐fertilize knowledge and foster innovation and entrepreneurship in emerging industries.
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The interaction between institutional settings and Entrepreneurial Families (EFs) is two-fold. Extant literature has attempted to understand how institutional settings can affect Family Businesses’ embeddedness. Both perspectives are complementary and necessary to recognise that EFs are not only locally embedded in their territories, but they are also entrenched in institutions. Despite this, how different institutional settings impact on EFs’ local embeddedness remains unexplored. To fill this gap, we combine institutional theory and family business research to perform a qualitative investigation. Drawing on the Varieties of Capitalism institutional categorisation, an exploratory study is carried out by including four European regions from countries that are positioned as a Coordinated Market Economy (CME) (Germany), a Liberal Market Economy (LME) (United Kingdom) and two cases of Mediterranean capitalist system (France and Spain). 43 semi-structured interviews were conducted across the regions and analysed through an open-coding process. Findings unveil that EFs’ local embeddedness is conditioned by different institutional settings in different ways, namely through codified mechanisms (CME and Spain) and through nonformalised mechanisms (LME and France). These are unfolded in 20 mechanisms, which contribute to territorial policies adjustments depending on the category of institutional setting where EFs are locally embedded.
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Family firms represent the backbone of regional economies in Europe. Yet, due to demographic and societal changes, family firm succession increasingly poses a challenge to both firm continuity and regional stability, which is why policymakers look for appropriate ways to support family firms in their succession processes. In pursuit of policies that fit local institutional conditions, we explore the fact that two structurally similar European regions facing the same succession problem have developed different policies to address it. Using the analytical framework of institutional logics and drawing on 67 interviews with family firms and succession experts in the Spanish Basque Country and the German region of Baden-Württemberg, we find that the different policies are coherent with each region’s unique constellation of the institutional logics of business, family, and community and thus make up distinct regional policy regimes. The paper offers a framework applicable to other regions for making underlying normative behavioural guidelines visible, and for more precisely assessing the relationship between institutions and policies. It contributes to a better understanding of the regional specificity of institutions as a base upon which place-sensitive policies can be developed, or fundamental attempts be made to re-shape institutions by political measures.
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Recent years have witnessed much experimentation with smart specialization strategies (RIS3) and entrepreneurial discovery processes (EDPs) in European regions. The EDP can be seen as an opportunity to address institutional questions. Because institutional patterns can explain why some policies are eventually successful while others are not, looking at the institutional context of regional economies can increase the effectiveness of regional policy. This article argues that the EDP functions as a framework to discover institutional patterns specific to a regional economy, and to define policies either consistent with existing institutions or aiming at institutional change. The article proposes a conceptual framework to understand and analyze the two institution-related roles of the EDP, first as an institutional discovery process and second as an institutional change process. The article builds on empirical case studies in two regions (Lower Austria, Austria and South Tyrol, Italy) and two small countries (Slovenia and Croatia). The case studies focus on how these regions or countries organized the EDP that eventually led to the formulation of their RIS3, and on the institutional dynamics of the EDP in discovering and changing institutions. The article concludes with policy implications that contribute to the debate on post-2020 EU Cohesion Policy.
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This paper is the text prepared for the keynote address of the EUSN 2017 conference in Mainz, Germany. A short presentation of concepts reflects in part the foundations of neostructural sociology (NSS) and its use of social and organisational network analyses, combined with other methodologies, to better understand the roles of structure and culture in individual and collective agency. The presentation shows how NSS accounts for institutional change by focusing on the importance of combined relational infrastructures and rhetorics. Specific characteristics of institutional entrepreneurs who punch above their weight in institutionalization processes are introduced for that purpose, particularly the importance of multistatus oligarchs, status heterogeneity, high-status inconsistencies, collegial oligarchies, conflicts of interests and rhetorics of relative/false sacrifice. Two empirical examples illustrate this approach. The first case focuses on a network study of the Commercial Court of Paris, a 450-year-old judicial institution. The second case focuses on a network study of a fieldconfiguring event (the so-called Venice Forum) lobbying for the emergence of a new European jurisdiction, the Unified Patent Court, and its attempt to create a common intellectual property regime for the continent. For sociologists, both examples involve “studying up”: they are cases of public/private joint regulation of markets bringing together these ingredients of institutionalization.The conclusion suggests future lines of research that NSS opens for the studyof institutionalization, in particular using the dynamics of multi-level networks. One of themain issues raised by this approach is its contribution to the study of democratic deficits in aperiod of intense institutional change in Europe.
Chapter
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Scholarship on institutions across the social sciences faces a set of fundamental dilemmas. On the one hand, it needs to explain how institutions change. Yet explanations of change which point to external factors run the risk of reducing institutions to a mere transmission belt for other, more fundamental causes. On the other, it needs to explain how institutions can have meaningful consequences. Yet in practice it is often hard to distinguish the institutions that cause a particular behavior from that behavior itself. In this chapter, the author shows how, these dilemmas affect the relatively discrete approaches to institutions offered by rational choice, historical institutionalist and sociological institutionalist accounts. He map out the different ways in which authors have sought to resolve these dilemmas and then briefly outlines an alternative approach that borrows from evolutionary theory and an understanding of institutions as congregations of beliefs to offer a better answer to these problems.
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The authors propose a research agenda based on the premise that entrepreneurship can and should be viewed as an institution. This approach assumes that typical structures and processes involved in founding new businesses reflect common social understandings held by members of a group about the value of entrepreneurship and how it should be undertaken. It also assumes that these behavioral patterns and social understandings vary by geographic region and over time. An important task in furthering entrepreneurship research based on this approach is identifying key dimensions along which such institutional variation occurs. Here, the authors discuss two main dimensions that we argue merit more focused attention: modes of entry and modes of governance. Drawing on existing literature, they offer a number of hypotheses about conditions that are likely to be associated with group-level variation in each of these dimensions, and the impact of such variations on organizational outcomes.
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Zusammenfassung Neuere Forschungen brachten deutliche Hinweise auf regional unterschiedliche Ausprägungen bestimmter Persönlichkeitsmerkmale in der Bevölkerung. Solche regionalen Unterschiede bei prägenden Verhaltenseigenschaften einer Bevölkerung können wesentlich zur Erklärung einer regionalen Entwicklung beitragen. Wir geben einen Überblick über regionale Unterschiede von unternehmerischen Persönlichkeitsmerkmalen in der Bevölkerung in Deutschland. Es zeigt sich eine Reihe von hochsignifikanten regionalen Verschiedenheiten der Persönlichkeitsprofile, allerdings erweist sich die Effektstärke als relativ gering. Insgesamt deuten die Befunde darauf hin, dass die regionalen Unterschiede sowohl auf selektive Migration als auch auf Sozialisationseffekte zurückgeführt werden können.
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We use a new panel dataset to study the network of formal firm linkages within and across 52 aerospace clusters in North America and Europe. Our theoretical framework, built upon the knowledge-based cluster and global value chains literature, suggests that a reduction in spatial transaction costs has induced clusters to specialize in increasingly fine-grained value chain stages. This should cause the overall network to evolve from a geographically localized structure to a trans-local hierarchical structure that is stratified along value chain stages. Applying community structure detection techniques and organizing sub-networks by linkage type, we find empirical evidence in support of this proposition.
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This paper investigates the effect of related and unrelated variety on regional growth in West Germany. In particular, we analyze the role of regional absorptive capacity and new business formation for these effects. We find that West German regions benefit from both types of varieties. The positive effect of unrelated variety on growth is more pronounced in regions with higher levels of absorptive capacity in terms of R&D activities and with higher levels of new business formation. Such moderating effects cannot be found for related variety.
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Corporate Social Responsibility has grown popular among discussions in economics and societies worldwide. To a growing extent customers make their buying decisions underCSR aspects. Enterprises try to follow up with CSR strategies. But often a gap has to be detected between the theoretical approach of CSR and practical implementations within the entrepreneurial reality. This article introduces a possible approach of closing the gap within CSR implementation. The ‘Heilbronn Declaration’ is a voluntary agreement of enterprises and institutions in Germany especially of the Heilbronn-Franconia region. The approach of the ‘Heilbronn Declaration’ targets the decisive factors of success or failure, the achievements of the implementation and best practices regarding CSR. A form of responsible entrepreneurship shall be initiated to meet the requirements of stakeholders’ trust in economy. Therefore it has been elaborated by academics together with enterprises and their shareholders. It is an approach to make voluntary commitment more binding. Its scientific base may allowdevelopment of indicators for CSR implementation in business ventures and institutions to finalize in a CSR audit. The innovative approach of the ‘Heilbronn Declaration’ is theintegration of the prospective signatories into discussion on the idea and purpose of business from the very first beginning.Keywords: sustainability, corporate social responsibility, innovation, voluntary commitment, authentic CSR, small and medium sized enterprises (SME)
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This article aims to shed light on how institutions shape innovative capacity, by focusing on how regional government quality affects innovative performance in the regions of Europe. By exploiting new data on quality of government, we assess how government quality and its components (control of corruption, rule of law, government effectiveness and government accountability) shape patenting across the regions of the European Union (EU). The results of the analysis—which are robust to controlling for the endogeneity of institutions—provide strong evidence of a link between the quality of government and the capacity of regions to innovate. In particular, ineffective and corrupt governments represent a fundamental barrier for the innovative capacity of the periphery of the EU, strongly undermining any potential effect of any other measures aimed at promoting greater innovation. The results have important implications for the definition of innovation strategies in EU regions.
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Fritsch M. and Wyrwich M. The long persistence of regional levels of entrepreneurship: Germany, 1925–2005, Regional Studies. This paper investigates the persistent levels of self-employment and new business formation in different time periods and under different framework conditions. The analysis shows that regional differences regarding the level of self-employment and new business formation tend to be persistent for periods as long as eighty years, despite abrupt and drastic changes in the political–economic environment. This pronounced persistence demonstrates the existence of regional entrepreneurship culture that tends to have long-lasting effects.
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This paper develops a rigorous concept of institutions to investigate the interrelationships between institutional and economic change from the perspective of economic geography. We view institutions neither as behavioural regularities nor as organizations or rules, but conceive institutions as stabilizations of mutual expectations and correlated interaction. The paper discusses how economic interaction in space is shaped by existing institutions, how this leads to economic decisions and new rounds of action, and how their intended and unintended consequences impact or enact new/existing institutions. The paper explores three modes of institutional change – hysteresis, emergent change, and institutional entrepreneurship.
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The aim of this paper is to identify regions with industrial clusters in Germany and to analyse their entrepreneurial environment. A new index employing industry data supplied from the German Federal Labour Office is used to elaborate on spatial clusters in the most concentrated German industries. A second data set collected as part of the Global Entrepreneurship Monitor (GEM), serves to assess the relationship between regional clusters and entrepreneurial activities and attitudes. The paper tests the rather popular but hitherto seldomly empirically-proven hypothesis that the existence of one or several industrial cluster(s) in a region has a positive impact on the number of start-ups and attitudes in the very same region. The implications of the findings with respect to regional policies encouraging industrial clusters are discussed briefly in the concluding section.
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Today, the Bay Area is home to the most successful knowledge economy in America, while Los Angeles has fallen progressively farther behind its neighbor to the north and a number of other American metropolises. Yet, in 1970, experts would have predicted that L.A. would outpace San Francisco in population, income, economic power, and influence. The usual factors used to explain urban growth—luck, immigration, local economic policies, and the pool of skilled labor—do not account for the contrast between the two cities and their fates. So what does?The Rise and Fall of Urban Economies challenges many of the conventional notions about economic development and sheds new light on its workings. The authors argue that it is essential to understand the interactions of three major components—economic specialization, human capital formation, and institutional factors—to determine how well a regional economy will cope with new opportunities and challenges. Drawing on economics, sociology, political science, and geography, they argue that the economic development of metropolitan regions hinges on previously underexplored capacities for organizational change in firms, networks of people, and networks of leaders. By studying San Francisco and Los Angeles in unprecedented levels of depth, this book extracts lessons for the field of economic development studies and urban regions around the world. [Publisher's abstract]
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In recent years, economic geographers have seized on the concepts of `path dependence' and `lock-in' as key ingredients in constructing an evolutionary approach to their subject. However, they have tended to invoke these notions without proper examination of the ongoing discussion and debate devoted to them within evolutionary economics and elsewhere. Our aim in this paper, therefore, is, first, to highlight some of the unresolved issues that surround these concepts, and, second, to explore their usefulness for understanding the evolution of the economic landscape and the process of regional development. We argue that in many important aspects, path dependence and `lock-in' are place-dependent processes, and as such require geographical explanation. However, the precise meaning of regional `lock-in', we contend, is unclear, and little is known about why it is that some regional economies become locked into development paths that lose dynamism, whilst other regional economies seem able to avoid this danger and in effect are able to `reinvent' themselves through successive new paths or phases of development. The issue of regional path creation is thus equally important, but has been rarely discussed. We conclude that whilst path dependence is an important feature of the economic landscape, the concept requires further elaboration if it is to function as a core notion in an evolutionary economic geography.
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Wie das im Jahr 2014 aktualisierte Leitbild zur Wirtschaft in Vorarlberg anhand verschiedener Kennzahlen darstellt, „…gehört die Region zum Vorderfeld der wirtschaftlich leistungsfähigsten europäischen Räume.“ (Amt der Vorarlberger Landesregierung 2014: 5). Trotz weltweit gravierender Finanz- und Wirtschaftskrisen konnte Vorarlberg zwischen 2001 und 2011 ein durchschnittliches Wirtschaftswachstum von 2,2 Prozent erzielen, womit es über dem nationalen Schnitt von 1,8 Prozent lag. Ebenfalls lag das Bruttoregionalprodukt (BRP) über dem Bundesdurchschnitt. Mit einer BRP-Pro-Kopf-Quote von 36.200 Euro in 2010 reihte sich Vorarlberg unter den NUTS-2-Regionen – das sind jene Bezugseinheiten der europäischen Statistik, die sich auf mittelgroße Regionen und Millionenstädte beziehen – in die wirtschaftsstarke Gruppe ein wie etwa London, Wien, Stuttgart und Oberbayern (ebd.: 5f).
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Relatedness as driver of regional diversification: a research agenda. Regional Studies. The regional diversification literature claims that regions diversify in new activities related to their existing activities from which new activities draw on and combine local capabilities. The paper offers a critical assessment and identifies a number of crucial issues for future research. It calls for (1) a disentanglement of the various types of capabilities that make regions diversify; (2) the inclusion of more geographical wisdom in the study of regional diversification, like a focus on the effects of territory-specific contexts, such as institutions; (3) a thorough investigation in the conditioning factors of related and unrelated diversification in regions; and (4) a micro-perspective on regional diversification that assesses the role of economic and institutional agents in a multi-scalar perspective.
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We examine the conditions around firm use of 'inventor bricolage,' or the reconstruction of technological capabilities through reallocation of extant individual inventors to address new opportunities embodied in patents. Empirically, we examine the dynamics of both firm and individual patenting activity in publicly traded Life Science Diagnostic firms to explore how inventor bricolage is related to firms' existing research and development (R&D) capabilities and firms' acquisition of external capabilities through merger and acquisition (M&A) activities. Evidence at the firm level suggests that breadth of inventors' human capital and collaboration with co-researchers with relevant experience is positively related to inventor bricolage. At the inventor level, the fewer patents an inventor has, the broader the individual's prior patent portfolio, and the more co-researchers with relevant experience, the more likely inventors will patent in a new area. M&A does not appear to have an impact on the utilization of existing human capital. Our findings suggest that R&D managers should assign inventors with less assimilative capacity and more creative capacity in teams where there is relevant experience in order to promote inventor bricolage.
Chapter
Qualitative Content Analysis designates a bundle of text analysis procedures integrating qualitative and quantitative steps of analysis, which makes it an approach of mixed methods. This contribution defines it with a background of quantitative content analysis and compares it with other social science text analysis approaches (e.g. Grounded Theory). The basic theoretical and methodological assumptions are elaborated: reference to a communication model, rule orientation of analysis, theoretical background of those content analytical rules, categories in the center of the procedure, necessity of pilot testing of categories and rules, necessity of intra- and inter-coder reliability checks. Then the two main procedures, inductive category formation and deductive category assignment, are described by step models. Finally the procedures are compared with similar techniques (e.g. codebook analysis) and strengths and weaknesses are discussed.
Book
Today, the Bay Area is home to the most successful knowledge economy in America, while Los Angeles has fallen progressively farther behind its neighbor to the north and a number of other American metropolises. Yet, in 1970, experts would have predicted that L.A. would outpace San Francisco in population, income, economic power, and influence. The usual factors used to explain urban growth—luck, immigration, local economic policies, and the pool of skilled labor—do not account for the contrast between the two cities and their fates. So what does? The Rise and Fall of Urban Economies challenges many of the conventional notions about economic development and sheds new light on its workings. The authors argue that it is essential to understand the interactions of three major components—economic specialization, human capital formation, and institutional factors—to determine how well a regional economy will cope with new opportunities and challenges. Drawing on economics, sociology, political science, and geography, they argue that the economic development of metropolitan regions hinges on previously underexplored capacities for organizational change in firms, networks of people, and networks of leaders. By studying San Francisco and Los Angeles in unprecedented levels of depth, this book extracts lessons for the field of economic development studies and urban regions around the world.
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Berlemann M. and Jahn V. Regional importance of Mittelstand firms and innovation performance, Regional Studies. Despite the deeply rooted belief of politicians all over the world about the important role of Mittelstand firms, there has yet been surprisingly little empirical research on this issue. This article contributes to the literature by studying whether the relative regional importance of Mittelstand firms has an effect on regional innovation performance. Using a cross-section of German NUTS-3 regions, a significantly positive relation between the relative importance of owner-managed small and medium-sized enterprises and patent applications is identified. This finding is highly robust when controlling for spatial correlations as they often occur in highly disaggregated regional analyses.
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This paper examines the roles of local institutions in economic development at the local level. Drawing upon comparative analysis of the 39 local enterprise partnerships emergent in England since 2010, it demonstrates: how local economic development institutions work within multi-agent and multi-scalar institutional settings; the ways institutional genealogy shapes processes of layering and recombining as well as dismantling and improvising in episodes of institutional change and the analytical themes able to explore the roles and functions of institutions in local economic development.
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This article critically analyses how the institutional environment influences the development of entrepreneurship in Bulgaria. Drawing on in-depth interviews with Bulgarian entrepreneurs an ‘institutional asymmetry’ between formal and informal institutions is identified which hampers the development of economically and socially productive entrepreneurship. Despite reforms to formal institutions in Bulgaria, the asymmetry persists as a result of informal institutions which serve to hamper entrepreneurship. In order to reduce this asymmetry, there is a need to develop and align formal and informal institutions, while recognising that such institutional reforms are, by their nature, long-term and may potentially be undermined by entrepreneurs engaging in informal and corrupt activities.
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Although there are many potential points of intersection between institutional theory and contemporary studies of entrepreneurship, these have generally remained distinct literatures, with the connections left more implicit than explicit. We argue that there are a number of benefits to explicitly articulating the links between these bodies of scholarship. In this context, we review work that relates to two key questions we believe are especially likely to benefit from the integration of these literatures-namely, how do institutions affect entrepreneurial choices? And how is entrepreneurship related to changes in institutions? We conclude by considering a number of topics for future research suggested by this integration.
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In the West are the 'haves', while much of the rest of the world are the 'have-nots'. The extent of inequality today is unprecedented. Drawing on an extraordinary range of contemporary and historical examples, Why Nations Fail looks at the root of the problems facing some nations. Economists and scientists have offered useful insights into the reasons for certain aspects of poverty, such as Jeffrey Sachs (it's geography and the weather), and Jared Diamond (it's technology and species). But most theories ignore the incentives and institutions that populations need to invest and prosper: they need to know that if they work hard, they can make money and actually keep it - and the key to ensuring these incentives is sound institutions. Incentives and institutions are what separate the have and have-nots. Based on fifteen years of research, and stepping boldly into the territory of Ian Morris's Why the West Rules - For Now, Daron Acemoglu and James Robinson blend economics, politics, history and current affairs to provide a new, persuasive way of understanding wealth and poverty. And, perhaps most importantly, they provide a pragmatic basis for the hope that those mired in poverty can be placed on the path to prosperity.
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This book is designed primarily to serve as a college text for the student's first course in regional economics, at either the upperclass or the graduate level and running for either one or two terms. It presupposes no previous exposure to regional economics as such, nor anything beyond a minimal background in basic economics, nor any advanced mathematical expertise. Most of the book, and all of its essential content, should be comprehensible to the "intelligent layman." The wide range of topics covered is intended to serve the needs of the student who will not be going on to more advanced and specialized courses in the regional field; those who do use it as a stepping stone to such later work will find here some useful previews of questions (especially in regional growth analysis and in urban economics) to which they will be addressing themselves more intensively later.
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The literature on the association between cultural values and entrepreneurial beliefs, motives and behaviours has grown significantly over the last decade. Through its influence on beliefs, motives and behaviours, culture can magnify or mitigate the impact of institutional and economic conditions upon entrepreneurial activity. Understanding the impact of national culture, alone and in interaction with other contextual factors, is important for refining our knowledge of how entrepreneurs think and act. We present a review of the literature with the goal of distilling the major findings, points of consensus and points of disagreement, as well as identify major gaps. Research has advanced significantly with respect to examining complex interactions among cultural, economic and institutional factors. As a result, a more complex and nuanced view of culture's consequences is slowly emerging. However, work that connects culture to individual motives, beliefs and values has not built significantly upon earlier work on entrepreneurial cognition. Evidence for the mediating processes linking culture and behaviour remains sparse and inconsistent, often dogged by methodological challenges. Our review suggests that we can be less confident, rather than more, in the existence of a single entrepreneurial culture. We conclude with suggestions for future research.
Article
The concept of regional strategy has been imported from the field of strategic management without reflecting on its specificities. This paper offers a holistic approach, which integrates all the elements a regional strategy should take into account around three core questions regarding: the strategy objectives (‘what for?’); the strategic positioning and its bases (‘what?’); and the process of formulating the strategy (‘how?’ and ‘who?’). This framework is applied to identify and analyse the strategies developed in the Basque Country over the last 30 years. The Basque Country is of great interest as it epitomizes the experience of old industrialized European regions that were ravaged by the economic crisis of the 1970s and have since achieved a considerable economic success. It is also a good example of the dual process that has taken place in Europe, involving top-down decentralization and the transfer of powers from national to supranational institutions.
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In attempting to protect their innovations, firms can choose from a range of mechanisms, which may be either non-statutory (trade secrets, design complexity, and lead-time advantage over competitors) or statutory (patent, design registration, trademark, copyright). Yet, little is known about how firms do actually make their choices from among these different appropriability mechanisms. The aim of this paper is to determine how French firms’ use of intellectual property protection mechanisms relates to the type of innovation, the characteristics of the market sector in which they operate, the firms’ characteristics, and their human resources strategies. Our empirical model draws on four French databases covering the period 2001–2004. Our results show that the choice of a means of protection matters and emerges out of a complex strategy. Our results also reveal that the different statutory and non-statutory means of protection are complementary within their own categories but hardly so between categories.
Article
This paper discusses whether institutions matter for regional development and how to integrate them in regional development strategies. It finds that while institutions are crucial for economic development, generating an institution-based regional development strategy is likely to be undermined by the lack of definition of what are adequate, solid, and efficient institutions. Problems related to the measurement of institutions, to their space and time variability, to the difficulties in establishing the right mix of formal and informal institutions, and to the endogeneity between institutions and economic development make one-size-fits-all approaches to operationalizing institutions difficult. Development strategies specifically tailored to the conditions of different regional institutional environments across regions may yield greater returns.
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Editor's Note. Three years ago, I invited Robert (Bob) Gephart to write a "From the Editors" column designed to help authors improve their chances of success when submitting qualitative research to AMJ. Judging from the increasing number of quali- tative studies that have been accepted and pub- lished in AMJ since that time, I would like to think that his article, "Qualitative Research and the Academy of Management Journal," has had a pos- itive impact. Continuing in this tradition, I asked Roy Sud- daby—an excellent reviewer (and author) of quali- tative research—to tackle another "big issue" that the editorial team has noticed with respect to qual- itative submissions to AMJ: overly generic use of the term "grounded theory" and confusion regard- ing alternative epistemological approaches to qual- itative research. Like Bob before him, Roy has, I believe, produced an analysis that will greatly ben- efit those who are relatively new to qualitative re- search or who have not yet had much success in getting their qualitative research published. Hope- fully, Roy's analysis will help even more authors to succeed, thus allowing AMJ and other journals to continue to increase the quality of insights pro- vided by rich qualitative studies of individual, or- ganizational, and institutional phenomena. Sara L. Rynes
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A high density of highly innovative world market‐leading small and medium‐sized companies (SMEs) can be found in the rural region Heilbronn‐Franconia of Germany. Those are commonly named as 'German hidden champions'. This research aims to reveal factors that influence their innovation governance structure, by examining the firm's characteristics, HRM, organisational structures and leadership styles. All four influencing factors have been explored through semi‐structured qualitative interviews with the owners or top‐managers of the firms. For evaluation, a qualitative content analysis based on Mayring's suggestions was implemented using NVivo8. With regards to fostering innovation a strong sense of entrepreneurial activity and visionary leadership; emphasis on local recruitment strategies, retention programs and employees' involvement in business processes; formalised innovation processes; informal networks; rigorous knowledge management and open communication modes were discovered.
Article
Examines the role that institutions, defined as the humanly devised constraints that shape human interaction, play in economic performance and how those institutions change and how a model of dynamic institutions explains the differential performance of economies through time. Institutions are separate from organizations, which are assemblages of people directed to strategically operating within institutional constraints. Institutions affect the economy by influencing, together with technology, transaction and production costs. They do this by reducing uncertainty in human interaction, albeit not always efficiently. Entrepreneurs accomplish incremental changes in institutions by perceiving opportunities to do better through altering the institutional framework of political and economic organizations. Importantly, the ability to perceive these opportunities depends on both the completeness of information and the mental constructs used to process that information. Thus, institutions and entrepreneurs stand in a symbiotic relationship where each gives feedback to the other. Neoclassical economics suggests that inefficient institutions ought to be rapidly replaced. This symbiotic relationship helps explain why this theoretical consequence is often not observed: while this relationship allows growth, it also allows inefficient institutions to persist. The author identifies changes in relative prices and prevailing ideas as the source of institutional alterations. Transaction costs, however, may keep relative price changes from being fully exploited. Transaction costs are influenced by institutions and institutional development is accordingly path-dependent. (CAR)