Politics and the Evolution of Inter-firm Networks: A Post-Communist Lesson

Abstract

This article attempts to account for both continuity and change in network structures and relationships by analyzing how a country's political approach to institution building shapes the reproduction of industrial networks. While firm-level actors may develop tenacious socio-economic relationships, the authority structure of a network emerges from the ways certain constituent firms align themselves with public institutions. I empirically examine this approach by analyzing the evolution of Czech industrial networks during and after communism. The fragility, eventual stability, and subsequent changes in networks come not from purely 'intra-network' factors, but rather from the political approaches of the government toward institution building. In short, this article aims to renew our focus on the origin and evolution of social capital and networks by enjoining network analysis with recent work in political economy.

Leadership in Interorganizational Networks: A Literature Review and Suggestions for Future Research

“…For example, Provan and Kenis (2008) identified three forms of network governance, which are similar to our conception of hierarchical and heterarchical networks in that they discussed networks that were governed by their participants (herein heterarchical networks), a lead organization (herein hierarchical networks) and a mixed form, of a network governance administration (cf. also Kim 2008;McDermott 2007). By contrast, used longitudinal data from 53 networks across a number of industries in order to identify the distinct forms of network that result from the way in which different R&D consortia were formed.…”

“…In a similar vein, Dhanaraj and Parkhe (2006) argued that the orchestration of innovation networks is supposed to stabilize them by enabling the diffusion of knowledge, and finally optimizing their innovation output. This notion is Organization Network structure: Capability / corporate strategy: Capaldo (2007), ) Hinterhuber (2002 Level of analysis ff d b g Rules / network structure: , Batterink et al (2010), Bryson, Kelley (1978), , Grandori (1997), Kenis, Network vision / agenda: Beyer, Browning (1999), Chen, Graddy (2010), Connelly (2007), ), Huxham (2000, , Hinterhuber (2002), , affected by leadership Network , Grandori (1997), Kenis, Provan (2006), Kim (2008), Martin et al (2008), McDermott (2007), Milward, Provan (1998), , , Sydow (2004), Saz-Carranza, Ospina (2010) Knowledge transfer : Boari Lipparini (1999) (2007), ), Huxham (2000, Huxham (2003), Huxham, Vangen (2000) Trust: Beyer, Browning (1999), Dyer, Nobeka (2000), Huxham (2000), Huxham (2003), Huxham, Vangen (2000), , Lorenzoni Baden Fuller (1995) Sydow Knowledge transfer: Boari, Lipparini (1999), Dhanaraj, Parkhe (2006), , Häcki, Lighton (2001), Lorenzoni, Baden-Fuller (1995), Lorenzoni, Lipparini (1999), Nambisan, Sawhney (2011), , Lorenzoni, Baden-Fuller (1995), Sydow, Windeler (2003) Capability / network strategy: Lore...…”

Organization theory and the post-socialist transformation: Contributions to organizational knowledge

“…Although researchers such as Miller and Friesen (1980) and Tushman and Romanelli (1985) argue that revolution is the only way to make changes stick in turbulent times, transformation research leads to more contingent conclusions. Third, organizations can undergo processes of hybridization or institutional recombination, whereby local agents negotiate a mixture of new and old know-how that leads to genuinely new forms of organization (McDermott, 2007).…”

Toward an institutional ecology of establishment of foreign firms in the Chinese construction industry

“…capital investment supported by government) and intangible assts in terms of brand names, distribution networks, and advantaged incumbent positions (Huang 2003), ease of access to bank loan, regulatory advantages, and network and affiliation with government (Garnaut et al 2001). In particular, socioeconomic and political ties can bestow legitimacy, asset control and resources on firms and this process is more prominent in the postcommunist countries, where institutional renovations take place in relatively short time periods (McDermott 2008). We also recognize that the competitiveness of privately-owned enterprises is damaged by the bureaucratic process for private firm registration, licenses for business operation in some restricted sectors, impediments for getting loans from banks, which mostly are owned by state, and some special policy restrictions, local taxation and fees, and local discrimination against POEs (Garnaut et al 2001;Garnaut and Song 2003;Taubmann, Heberer, and Jie 2003).…”

“…Moreover, an integration of structural analysis on network processes (cf. Grabher 1993;Sydow and Windeler 1998;McDermott 2008) or the spillover processes (c.f. Hale and Long 2006;Chang and Xu 2008) into the legitimation/ competition framework is promising in dealing with the complication implied by the socioeconomic transformation in China.…”