An Inquiry on Trade Associations and Other Meta-Organizations
Chapter 4: Firms collective action devices as a mix of heterarchy and hierarchy
To study the dynamics of firms’ collective action devices (FCADs), a longitudinal analysis of a meta-organization was conducted. It is based on the analysis of the costs and benefits of collective action over the long term. For firms, direct costs (fees) are low. Generally, there is a phenomenon of cross-subsidization: large firms pay proportionally more than small firms. The latter therefore pay little. As for large firms, even if their contributions are proportionally higher, they represent very little compared to their turnover. The benefits derived by firms are both individual and collective. The analysis highlights a series of temporal nodes: the creation of a formal organization or the operation of an informal mode; the minimum activity in the DIY or the scaling of the organization; maintenance of the activity or entering into dormancy; the possible creation of a new organization. This model explains the proliferation trend of FCADs and, at the same time, their longevity.
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