The Strategic Organization of Political Risks and Opportunities

Abstract

Firms compete for rents not only within the marketplace, but also through their efforts in the political arena to manipulate regulations, laws and other institutions that govern the marketplace. The field of strategic organization has traditionally focused on the first form of competition, leaving the latter, often distinguished as non-market strategy, largely to scholars from the field of political economy. This research primarily examines how a firm’s political environment – the configuration of formal policymaking institutions, regulatory rules, partisan composition and interest group influence – determines the form and efficacy of its non-market behavior, such as lobbying and making donations to political actors. We urge scholars of strategic organization to enter the field of non-market strategy. Because investigation of the process by which firms manage political opportunities and risks requires that the political environment be taken into account, strategic organization scholars who follow our suggestion will need to cross the disciplinary boundary of positive political economy (PPE). As adherents of multidisciplinary analysis, these scholars are better equipped and likely more willing to cross this boundary than their disciplinary counterparts in PPE are to venture into disciplines such as sociology and organization theory. Moreover, we believe that continued growth of the field of nonmarket strategy, including the development of managerially relevant knowledge, depends critically on the incorporation of constructs and insights from these disciplines. At the same time, scholars of strategic organization would benefit from the novel opportunities that non-market topics provide to ply their tools of trade. We focus on two current growth areas. The first is the social context of policymaking. Political economy scholars take a rationalist, equilibrium approach to the policymaking process – and thus to non-market strategy – that focuses on economic influences to the neglect of cultural biases and beliefs that in reality play a critical role. Scholars of strategic organization possess the multidisciplinary skills necessary to analyze how firms’ non-market strategies reflect and exploit these social institutions. STRATEGIC ORGANIZATION Vol 1(4): 451–46

Cite this work

No public copy is stored for this record, so only the metadata is cited.

Stored only when both papers are in the corpus — 110 citations exist upstream.

Papers that cite the same references — the relational fallback while embeddings are still backfilling.