Institutional Change and the Transformation of Interorganizational Fields: An Organizational History of the U.S. Radio Broadcasting Industry

TLDR

The study examines how institutional practices evolve over time within the interorganizational field of the U.S. radio broadcasting industry. The authors aim to identify three endogenous mechanisms of change—analogies, private agreements, and conventions—and to analyze how conventions shape the field. The study identifies three endogenous mechanisms—analogies, private agreements, and conventions—that, depending on the nature of goods transacted, trigger changes in established practices as actors seek value. Conventions introduced by fringe players to address coordination problems and competitive pressures were later adopted by central players, transforming industry organization and becoming new institutional practices, illustrating that field organization depends on institutionalized transaction definitions.

Abstract

? 1991 by Cornell University. 0001 -8392/91/3603-0333/$1 .00. The research reported here explores how institutional practices change over time in an interorganizational field, in the historical context of the U.S. radio broadcasting industry. It identifies three endogenous mechanisms of change: analogies that are used to make sense of and manage new phenomena, private agreements between identifiable parties, and conventions, the practices adopted by some constituents to solve coordination problems. The use of each mechanism is associated with the nature of the goods transacted within a field and triggers change in established practices as actors attempt to realize value from their transactions. After describing each mechanism as found in the radio broadcasting industry, we focus our historical analysis on conventions. It reveals that conventions were introduced into the broadcasting field by fringe players to deal with shifting coordination problems and competitive pressures. Once they were adopted by the central players, these conventions transformed the organization of the industry by changing the basis of transactions and became its new institutional practices. We conclude that the organization of a field is not permanent, but is contingent upon institutionalized definitions of what is being transacted.