Institutional and Political Sources of Legislative Change: Explaining How Private Organizations Influence the Form and Content of Consumer Protection Legislation

Abstract

This article explores how private organizations influence the content and meaning of consumer protection legislation. I examine why California forced consumers to use a private dispute resolution system that affords consumers fewer rights, while Vermont adopted a state-run disputing structure that affords consumers greater rights. Drawing from historical and new institutional theories, I analyze twenty-five years of legislative history, as well as interviews with drafters of the California and Vermont laws, to show how automobile manufacturers weakened the impact of a powerful California consumer warranty law by creating dispute resolution venues. As these structures became institutionalized in the lemon law field, manufacturers reshaped the meaning of legislation. Unlike California, the political alliances in Vermont and a different developmental path led to a state-run dispute resolution structure. I conclude that how social reform laws are designed and how businesses influence social reform legislation can increase or decrease the achievement of a statute's social reform goals.

How Legal Intermediaries Facilitate or Inhibit Social Change

“…More recently, scholars have started to broaden the framework beyond managerialization and explore how other non-managerial logics influence the way that organizations understand the meaning of law and in particular, the role of intermediaries who are not legal professionals (Pélisse, 2014(Pélisse, , 2016. Consumer, risk, science and prison logics emanating in various organizational fields can influence the way that organizations understand the meaning of law (Stryker, Docka, & Wald 2012;Verma, 2015;Talesh, 2012Talesh, , 2014Talesh, , 2015a. Managerial logics can be in contestation with logics or work in complimentary ways (Talesh, 2015a).…”

“…Managerial logics can be in contestation with logics or work in complimentary ways (Talesh, 2015a). Moreover, managerial, risk, labor or consumer conceptions of law shape the way public legal institutions such as legislatures (Talesh 2009(Talesh , 2014Pélisse, 2009), courts (Edelman et al, 1999;Edelman, 2005Edelman, , 2007, regulatory agencies (Talesh, 2012(Talesh, , 2015c and arbitration forums (Talesh, 2012) understand law and compliance.…”

Rule‐Intermediaries in Action: How State and Business Stakeholders Influence the Meaning of Consumer Rights in Regulatory Governance Arrangements

“…Recent work in this area focuses attention on how organizational field logics influence the legal field, that is, “the environment within which legal institutions and legal actors and in which conceptions of legality and compliance evolve” (Edelman , 58; see also Edelman and Stryker ; Stryker , ; Clemens , ; Leblebici and Salancik ). The tensions between the logics of organizational and legal fields, one anchored around efficiency and rationality, the other around rights and justice (and more recently informality in the form of alternative dispute resolution), come into play when organizational and legal actors and institutions interact (Talesh , ; Edelman ; Stryker , ). As organizations increasingly “legalize” themselves through the creation of written policies and procedures and lawlike structures, managerial logics come to influence the way in which organizations (Marshall ; Edelman et al.…”

Data Breach, Privacy, and Cyber Insurance: How Insurance Companies Act as “Compliance Managers” for Businesses

“…Cyber risk management services do not just reduce risk; they actively construct the meaning of compliance. As shown in the employment and consumer protection contexts (Edelman, Uggen, and Erlanger 1999;Talesh 2009Talesh , 2012, these responses are becoming institutionalized and gaining legitimacy. In particular, public legal institutions are deferring to and encouraging organizations to purchase cyber security insurance.…”