Author Archive
Badly Needed: Research Into Meetings In Organizations
| Nicolai Foss |
Ahhhh! Today was my last day as member of the Academic Council (or Senate) of the Copenhagen Business School. As Denmark has the most undemocratic university legislation in the world (with the possible exception of North Korea) and the whole university system is socialized, all decision-making power is in actuality concentrated in the hands of the President and the Dean. This means that bodies such as the Academic Council have nada real decision-making competence. Knowing this, the members should be expected to get the meeting done as quick as possible, and go back to serious business, that is, research and teaching. Not so! One endless and essentially pointless debate followed another.
Which makes me wonder: Given that incredible amounts of time in organizations, public as well as private, and often involving absolute key employees, are spent in meetings, why do we see so very little serious (non-pomo) academic research into the phenomenon of meetings in organizations? (more…)
Levels Issues II — Do Levels Exist?
| Nicolai Foss |
As I indicated in my earlier post on levels issues in social science research, I am confused by these and I suspect that many others are also confused. Perhaps this merely reflects my lamentable lack of serious philosophical training, and it is therefore with very considerable hesitation that I venture into issues of ontology, explanation, and causation that pertain to levels of analysis. (In fact, the following to some extent has the character of a bleg).
Do levels of analysis exist? Well, obviously levels of analysis only exist in our models. Still, there may be some stuff reality that is “like” our analytical levels. If so, is there some kind of mapping from the levels of analysis of our theoretical accounts to the levels (conceivably) existing in social reality? Or, are levels (of analysis) “merely” methodological devices — features of our model — that are not necessarily mirrorred by anything in reality? (more…)
The Collected Works of Armen Alchian
| Nicolai Foss |
It has been said that “Armen Alchian’s output may be sparse and informal, but it has been among the most influential.” Still, his “virtuoso work on neoclassical price theory” has been sufficiently voluminous that his collected works run 1,620 pages!
The two volumes that contain all these pages were published in November by Liberty Fund at the ridiculously low price of $15 for the set. Over the years Liberty Fund has published an unbelievable amount of true classics in economics, law, history, philosophy and classical liberal scholarship in general at absolute bargain prices. (more…)
Who Really Cares?
| Nicolai Foss |
Danish party politics is essentially all a variation on one basic theme. Thus, we have extreme left social democrats, less lefty social democrats, middle-of-the-road social democrats, and conservative social democrats. The conservatism of the latter, currently in power, lies in their wish to keep the total tax burden at its current level (which given the recently announced Swedish tax cuts will make Denmark the World leader in income taxation). The other social democrats essentially wish to let the tax burden increase, and few see any problems with a marginal tax rate that goes into the 70s and beyond. All in the name of equality, of course.
Recently, the minister of social affairs made a major faux pas that upset virtually everyone. She argued that economic equality should not be seen as an independent policy goal. Her political life barely survived the media turmoil that immediately arose. The predictable “jungle law,” “heartless market mentality,””egoistic conservatism,” etc. labels were applied to the minister’s apostasy. The moral outrage was immense.
Enter Arthur C. Brook’s Who Really Cares? The Surprising Truth About Compassionate Conservatism which I am reading at the moment. It amounts to a frontal, data-based attack on the ideology that underlies redistributionism, that is,”in lieu of statist redestribution, nobody would really care for the poor, and most certainly not conservatives and libertarians.” (more…)
Foss, Klein, Kor, and Mahoney on Entrepreneurship
| Nicolai Foss |
As readers of O&M will know, Peter and I are highly sympathetic to subjectivist economics, mainly Austrian economics, and both take an interest in entrepreneurship and the theory of the firm. Yasemin Kor is an expert on the RBV and top management, and former O&M guest blogger Joe Mahoney is, of course, an expert on the RBV and the theory of the firm. This makes, we think, for an excellent author team. Thus, we have collaborated in writing a paper, “Entrepreneurship, Subjectivism, and the Resource-based View: Towards a New Synthesis.” Here is the abstract:
This paper maintains that the consistent application of subjectivism helps to reconcile contemporary entrepreneurship theory with strategic management research in general, and the resource-based view in particular. The paper synthesizes theoretical insights from Austrian economics and Penrose’s (1959) resources approach, arguing that entrepreneurship is inherently subjective and firm specific. This new synthesis describes how entrepreneurship is manifested in teams, and is driven by both heterogeneity of managerial mental models and shared team experiences.
Enjoy!
We Always Suspected It — Part II
| Nicolai Foss |
As we recently noted O&M has had the dubious honour of being included in the set of “heterodox newslettes and weblogs” along with blogs such as “Actuel Marx.” But it gets worse!! O&M has just received mention in Accounts: ASA Economic Sociology Section Newsletter vol. 6, issue 1, Fall 2006 (on p.15). We tremble when we consider what may come next. Honorable mention on webdeleuze? Endorsements from Bob Sutton?
HT to Teppo.
Co-Authors From Hell
| Nicolai Foss |
Casual empiricism seems to indicate that co-authorship is constantly gaining ground vis-a-vis sole authorship (anyone who knows of any solid studies of social science authoring practice?). There are numerous forces that positively influence the choice of teaming up with other scholars for the purpose of writing books and articles, such as career concerns (writing with a Big Guy), hierarchical concerns (writing with a Local Big Guy may help your chances of promotion), political calls for co-authorship between academia and industry, and, of course, team-based benefits, such as exposure to new perspectives, effort sharing, the social experience, etc.
It is well known that there is a significant latent moral hazard problem in connection with teams (cf. this paper). But of course there is also a potentially heavy adverse selection problem. It does matter which type you pick to co-author a paper with. I have been involved in numerous co-authored paper projects, and usually I have been lucky with my co-authors. Indeed, Kirsten, Peter, Keld, Torben, Teppo, Joe, and Yasemin are exemplary and excellent co-authors.
But I certainly haven’t always been lucky. (more…)
Students as Editors!?!?! A Law Journal Bleg
| Nicolai Foss |
My employer, Copenhagen Business School, has recently decided to adopt a “Top 60 Journals” list. It contains the usual suspects (SMJ, AMJ, ASQ, Org. Science, etc.) and a number of lesser journals, including some distinct outliers (such as Scandinavian Journal of Management :-)). It has now been proposed by the Dean that the list be used in connection with promotions; for example, a Full Professor must, according to the proposal, have at least one article published in a Top 60 journal. An extremely modest requirement, one would think. Not so. (more…)
We Always Suspected It …
| Nicolai Foss |
… but we are not sure we like it — “it” being the fact that O&M has now received certification that we belong to the distinct group of “heterodox newsletters and weblogs” along with “Actuel Marx” and “Lettre de la Regulation.” Hmmmm …
Another Journal Jere(h)miad
| Nicolai Foss|
A feuilleton here at O&M is what Omar at orgtheory.net (see here) has christened our “jerehmiads” (aka “jeremiads”) concerning journals. The implication is that we are grumpy old men who moralistically denounce the rationality of the journal institutions (e.g., here, here, here, and here). Whatever that may be here is another, errr, observation on our journals:
All journals that I know of require that for the final submission of a manuscript, it must be submitted in a certain format, including meeting rules for spacing, margins, maximum number of words, etc. Many, and perhaps most, journals also formally require that first submissions must stick to such a format, usually specified under “Instructions to Authors.”
However, at least until recently, very few journals would desk-reject a submission that did not follow the specified format (save for manuscripts that were obviously too long), and no reviewer would dream of complaining about manuscripts not following the journal’s specified format. (more…)
Are Profitable Firms Always Founded?
| Nicolai Foss |
No, says Matthias Kräkel. Here is the abstract of his recent neat paper, “On the ‘Adverse Selection’ of Organizations“:
According to New Institutional Economics, two or more individuals will found an organization, if it leads to a benefit compared to market allocation. A natural consequence will then be internal rent seeking. We discuss the interrelation between profits, rent seeking and the foundation of organizations. Typically, we expect that highly profitable firms are always founded but it is not clear whether the same is true for firms with less optimistic prospects. We will show that internal rent seeking may lead to a completely reversed result. The impact of internal rent seeking on overall investment and the implications of firm size and competition on the foundation of organizations are also addressed.
Admittedly, Kräkel’s stark result, that highly profitable firms may not be founded because of the prospect of heavy internal rent seeking, only holds for the situation where technology is exogeneosly given (he does relax this assumption and obtains other interesting results, however) and begs the question why exactly it is that rational cooperating individuals cannot constrain internal rent-seeking. However, there is a wider message in his paper, particularly for the resource-based approach in strategic management which — with the exception of the work of Russ Coff (see his 1999 Org Science paper and his 1997 AMR paper), Lippman and Rumelt (their 2003 SMJ paper on bargaining), and more recently Joe Mahoney (check Joe’s work on stakeholder theory) — has neglected internal bargaining processes in firms, including rent-seeking. Thus Kräkel’s work suggests that even if a projected venture controls resources that are strategic in the RBV sense, the venture may not materialize because of fear of rent-seeking in the second stage of the game (after the firm is actually founded).
Micro-Foundations and Realism
| Nicolai Foss |
As readers of O&M know, I have often endorsed the search for the badly missing micro-foundations in management research (e.g., here, here and here). Building micro-foundations means providing accounts (whether formal or verbal-logical) of how human action and interaction produce collective outcomes (whether intended or unintended).
To me such an approach is inherently mechanism-oriented. Accordingly, I tend to think of methodological individualism and mechanismic explanation as close philosophical allies. I also think that in terms of theorizing, attention to micro-mechanisms rooted in individual action and interaction requires close attention to behavioral assumptions. Apropos Milton Friedman the one part of his thinking that I have never made peace with is his methodological instrumentalism.
Until recently, I thought that virtually nobody in management research — with the exception of Teppo Felin — entertained similar views (OK — a bit over the top, but not much), until, that is, the advent of the November issue of the Strategic Management Journal features an article, “Behavioral Assumptions and Theory Development: The Case of Transaction Cost Economics,” by Eric Tsang that is explicit about how behavioral assumptions link to realistic explanation. (I just noticed that Tsang also has an earlier paper on critical realism). (more…)
Milton Friedman Has Died
| Nicolai Foss |
Under the heading Requiescat in Pace, Economist.Com briefly and concisely notes:
MILTON FRIEDMAN has died. An economics giant, he not only revolutionised monetary theory, but singlehandedly did more than almost any economist in history to advance the cause of free markets. He was not merely an accomplished economist, but an accomplished popular writer; his Newsweek columns remain gems of clarity and brilliance decades later. We will not soon see his like again.
Peter and I both expect to blog on Friedman and his contributions in the near future.
Pomo Periscope VI: Performativity
| Nicolai Foss |
Teppo Felin at orgtheory.net has an excellent post today on Donald MacKenzie’s An Engine, Not a Camera: How Financial Models Shape Markets — a book that has received praise from Michel Callon, Karin Knorr-Certina — and Paul Samuelson!
As the title of the book indicates, the book puts our old friend here at O&M — reflexivity (cf. this post) — to work in the context of the interplay between financial markets and financial economics. It sounds as if this will be a great read for the Ferraro-Pfeffer-Suttons of this World. (I haven’t read the book yet myself, so I cannot judge the accuracy of what Teppo says about it). (more…)
Italian Academia Goes International
| Nicolai Foss |
The universities of quite a number of European countries have reputations — well-deserved in a number of cases — of being hostile to foreign influences as well as foreigners (particularly those yanks!), nepotistic, insular, and introverted, particularly in the social sciences and the humanities. Large European countries, such as France, Italy, and Germany still run a major infrastructure of learned journals in the native tongue, and it is often understood that publishing in one of these (e.g., the Sardinian Journal of the Economics of Olive Production) may be better for one’s career than publishing in irrelevant (and, oh horror, American) journals such as Journal of Political Economy or the Strategic Management Journal.
Luckily, things are changing all over Europe concerning the internationalization of the Academy. Here is an example: The Lucca Institute for Advanced Studies, opened last year to support “PhD programs and research activities in the fields of political and social sciences, market regulations, economics, management, biorobotics, industrial and computer technologies.” On its frontpage it stresses that among its “distinctive features” (!) are “open and competitive selection processes” and “international faculty.” Telling!
Note also the job openings for assistant professors and post-doctoral fellows. Lucca isn’t a bad place at all to spend a part of your life!
Machlup on Equilibrium
| Nicolai Foss |
The notion of equilibrium in economics has been discussed on an earlier occasion here at O&M (here). Perhaps as a reaction to this, former guest blogger, Joe Mahoney, has mailed a long but important quotation from Fritz Machlup’s (1967) Essays in Economic Semantics (pp. 44-5, 54, 56-7) which is reproduced below. (Joe notes that “as a humorous aside the original 1963 version of the book was titled: Essays ON Economic Semantics, but since only one chapter of the book was actually ON the topic of economic semantics, the 1967 paperback version title was changed to Essays IN Economic Semantics” — very interesting!) Here is the quotation (and a few comment below): (more…)
Network Positions and Competitive Advantage
| Nicolai Foss |
One of the most important trends in strategic management research over the last decade or so has no doubt been the application of arguments developed in sociology by the likes of Mark Granovetter and Ron Burt. In the hands of able interpreters, such as Gautam Ahuaja, Olav Sorenson, Brian Uzzi, Toby Stuart, and many others, these arguments mark the real advent of sociology as a forceful voice in the conversation of strategic management scholars, a conversation that had until clearly been dominated by arguments drawn from various fields in economics.
Although I am usually impressed with the efforts of the above scholars, I have also sometimes felt a bit uneasy when reading papers that draw on the sociology literature on networks. Theoretical development seems conspicuous by its absence. Many things seem to be taken as exogenos, notably positions themselves. Moreover, the literature often seems to suggest that network positions may be associated with competitive advantage, but the precise mechanism that makes this happen is far from clear. (more…)
Political Correctness and Public Sector Management
| Nicolai Foss |
The following is ephemera, but we have noted from the blog stats that our readership appreciates this category of posts. And we believe in giving the market what the market wants.
I was recently accused by an (admittedly weird) external lecturer here at CBS for having fascist sympathies. I thought my political leanings were classical-liberal, which I would tend to associate with rather the opposite of fascism. Oh well; the reasoning of this person was that I ran a blog that linked to the Ludwig von Mises Institute; that institute was known for being associated with people who had an unconventional view of the American Civil War; a view, this person added, that any sane human being would recognize as fascist! QED
I was reminded of this incident when I read this story in the UK newspaper, The Daily Mail. (more…)
Grounded Theory
| Nicolai Foss |
At least until recently I considered “grounded theory” to be one of my favorite Hermann Göring words (“When I hear the word ‘grounded theory’ I reach for my Browning”). I know that this is an assessment that many practicioners of a, dare we say more “positivist” research methodology share. Too often I have witnessed presentations where “grounded theory” comes across as a bad excuse for not knowing the relevant literature. Epistemologically, grounded theory sometimes stands out as a variant of naïve inductivism. (more…)
Pomo Periscope V: Motivation Theory Under Attack
| Nicolai Foss |
As we know pomo is placing its tentacles virtually everywhere. Having long ago attacked and partially conquered organization studies, pomo is now increasingly visible in the organizational behavior field. Here is an extract from the blurb for a recent book, The Passion of Organizing: (more…)
Organizations and Markets 
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