Conventions and Structures in Economic Organization

Conventions and Structures in Economic Organization

Markets, Networks and Hierarchies

New Horizons in Institutional and Evolutionary Economics series

Edited by Olivier Favereau and Emmanuel Lazega

This book contributes to the current rapprochement between economics and sociology. It examines the fact that individuals use rules and interdependencies to forward their own interests, while living in social environments where everyone does the same. The authors argue that to construct durable organizations and viable markets, they need to be able to handle both. However, thus far, economists and sociologists have not been able to reconcile the relationship between these two types of constraints on economic activity.

Chapter 10: Solidarity, its microfoundations and macrodependence: a framing approach

Siegwart Lindenberg

Subjects: economics and finance, economic psychology, history of economic thought, institutional economics, methodology of economics

Extract

Siegwart Lindenberg INTRODUCTION I get by with a little help from my friends (de Graaf and Flap, 1988). Having friends in important places is surely a useful thing, and one of the important changes in network analysis is the attention to the fact that people do not just have networks but actively build networks (Kaplan, 1984; Grieco, 1987). Ties are social resources, a network is social capital (Ben-Porath, 1980; Flap, 1988; Coleman, 1990; Burt, 1992). My social capital will provide me with important information, help me in need, get me favourable treatment and so on. Stories abound about how businessmen invite each other to expensive dinners, keep track of social events, like birthdays, and quite generally invest in befriending those business partners whose trust they need most. Casson (1991, p. 20) speaks of ‘the engineering of trust’. Heimer (1992, p. 143) even argues that organizational life is much about helping your friends and that relations in organizations are among named individuals who know one another as particular others. Attention to this active side of people’s pursuit of social ties connects nicely with sociology’s most revered topic: solidarity. What it adds to this traditional topic is the possibility that solidary relations are not only ‘naturally’ grown but also strategically created or maintained. In this way, it seems that traditional sociology is brought together with rational choice sociology in a very congenial way. The term ‘social capital’ suggests that both sides have been covered: the social and the rational side. If this...

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