PUBLISHED AND WORKING PAPERS
My research focuses on how social structure influences technology entrepreneurial processes and outcomes. Most of my research uses the lens of institutional theory to examine entrepreneurial processes. I also pay attention to the role of status and formal structures and their influence on entrepreneurship in technology intensive contexts.
I. PUBLISHED, FORTHCOMING, AND PROVISIONALLY ACCEPTED PAPERS
How does institutional prestige affect the ability of an organization to commercialize novel technology?
Sine, W.D., Shane, S., & DiGrigorio, D. 2003. The Halo Effect and Technology Licensing: The Influence of Institutional Prestige on the Licensing of University Inventions. Management Science, 49: 478-496.
Sociologists and organizational theorists have long claimed that the processes of knowledge creation and distribution are fundamentally social. Following in this tradition, we explore the effect of institutional prestige on university technology licensing. Empirically, we examine the influence of university prestige on the annual rate of technology licensing by 102 universities from 1991 to 1998. We show that institutional prestige increases a university’s licensing rate over and above the rate that is explained by the university’s past licensing performance. Because licensing success positively impacts future invention production, we argue that institutional prestige leads to stratification in the creation and distribution of university-generated knowledge.
How do institutional structures and processes shape the diversity of technologies used by new ventures?
Sine, W.D., Haveman, H., & Tolbert, P. 2005. Risky Business? Entrepreneurship in the New Independent-Power Sector. Administrative Science Quarterly, 50: 200-232.
We compare the effects of emergent institutions in a new industry on the founding rates of organizations using risky novel technologies and those using less-risky established technologies. Building on sociological research on institutions and organizations, and psychological research on risk and decision making, we propose that the development of institutions that decrease the risk associated with a new sector has a stronger effect on the founding rates of firms using novel technologies than on firms using established technologies, because decreases in sector-wide risk have bigger impacts on behavior when total risk (sector-specific and technology-specific) is high. The aggregate effect of reducing sector-wide risk is to increase technological variation among new ventures. The development of institutions that legitimize particular technological forms, on the other hand, decreases variation among new ventures. In our analysis of the independent-power sector of the electricity industry, we argue that regulative and cognitive institutions reduced sector-wide risk. In contrast, we argue, normative institutions directly legitimated particular technological forms, net of their indirect influence on sector-wide risk. Our study demonstrates how institutional forces can alter the mix of organizations entering a new industry and thus contribute to diversity, as well as similarity, among organizations.
Do entrepreneurs strategically create and seek institutional endorsements? How does endorsement seeking in a new sector vary within an organizational population over time?
Sine, W.D., David, R.J. and Mitsuhashi, H. From Plan to Plant: Effects of Certification on Operational Start-up in the Emergent Independent Power Sector, Organization Science, 18 (4): 1-17.
New organizations in emerging industries face tremendous legitimacy related barriers that often impede them from producing and marketing a product or service. This paper examines the variation in endorsement-seeking behavior by nascent firms in the emerging independent power industry. In particular we study variation in endorsement-seeking behavior among firm’s using new vs. established technology, an important aspect of organizational form. Results indicate that firms strategically compensate for industry and technology related legitimacy constraints by seeking endorsements from powerful institutional actors. We also find that endorsements increase the likelihood that new ventures will commence operations.
How does formal structure influence initial performance in new ventures in emerging technology industries?
W.D., Kirsch, D., & Mitsuhashi, H. 2005.
Revisiting Burns and
Stalker: Formal Structure and New Venture Performance in Emerging Economic
This study examines the effects of three attributes of formal structure – role formalization, functional specialization, and administrative intensity – on the performance of new ventures in the emergent internet sector during the years 1996-2001. Burns and Stalker (1961) argued that in dynamic economic sectors, firms with organic structure are more effective than those with more mechanistic structure. We suggest this proposition does not hold for new ventures in turbulent, emergent economic sectors. Instead, we theorize that formal structure enhances new venture performance. We build on Stinchombe’s (1965) argument that, unlike mature organizations, one of the key liabilities new organizations face is a deficit of formal structure. We hypothesize that new ventures with higher founding team formalization, specialization, and administrative intensity will outperform new ventures with more organic organizational structures. Our results support these hypotheses; greater role formalization, functional specialization, and administrative intensity are linked to superior organizational performance.
Why do franchisors choose contracts vis a vis bureaucracy to coordinate firm activities?
Mitsuhashi, H., Shane, S. & Sine, W.D. Organizational Governance Form in Franchising: Is Efficient Contracting Really The Explanation? (Forthcoming at Strategic Management Journal).
In this study, we examine firms’ use of contractual, hybrid, or hierarchical governance mechanisms. We develop and test hypotheses drawn from two competing theoretical perspectives: efficient contracting and organizational momentum. Using longitudinal data on a sample of business format franchisors operating in the United States, we show that: (1) organizational momentum is a better predictor of firms’ organizational governance form than efficient contracting: and (2) cross-sectional evidence for efficient contracting explanations for organizational governance form is not robust to the year of investigation, firm effects, or selection effects.
What role do environmental jolts and institutional processes play in technology entrepreneurship?
Sine, W.D. & David, R. 2003. Environmental Jolts, Institutional Change, and the Creation of Entrepreneurial Opportunity in the U.S. Electric Power Industry. Research Policy, 32: 185-207.
relationship between institutional change and entrepreneurship is poorly
understood. We build theory in this area by tracing institutional change in the
Why do institutions change?
Strang, D. & Sine, W.D. 2001. Interorganizational Institutions. Blackwell Companion to Organizations.
In this theoretical paper we explore the antecedents of institutional change. Recognizing that past research has focused on processes that explain institutionalization and sources of stability; in this chapter we examine sources of instability. In particular we review the neo-institutional literature and suggest a number of processes that affect macro-institutional change.
How do social movements create entrepreneurial opportunity?
Sine, W.D. & Lee, B. Tilting At Windmills? The Environmental Movement and the Emergence of the U.S. Wind Energy Sector (Conditionally Accepted at Administrative Science Quarterly).
Scholars and policymakers are increasingly interested in what factors promote regional entrepreneurial activity. We forward this agenda by examining the impact of regional technical, normative-cultural, and political features on entrepreneurial activity in the emerging wind energy sector 1978-1992. Our results suggest that while political change may create opportunities for new types of economic activity, cultural and technical characteristics determine regional variation of entrepreneurial activity within an emerging sector. We show that social movements moderate the impact of the material resource environment on entrepreneurial activity.
Lee, B.H., & Sine, W.D. 2006. Constructing Market Opportunities: Environmental Movements and the Transformation of Regional Regulatory Regimes. Applied Evolutionary Economics and Economic Geography (Cheltenham, UK and Northampton, MA: Edward Elgar).
This article investigates how differences in regional collective action affects state regulatory regimes that create opportunities for new types of economic activities to emerge. This paper contributes to current research on social movement organizations by emphasizing the important local effects movements have on regional economies. It contributes to research on economic geography by taking into account the role of collective action in opportunity creation.
II. PAPERS ON REVIEW AND WORKING PAPERS
How do institutional entrepreneurs shape institutions in an effort to create new economic sectors?
David, R.J., Sine, W.D., & Haveman, H. Institutional Change, Form Entrepreneurship, and the Legitimation of New Organizational Forms. (R&R Organization Science).
In this paper, we develop propositions about how actors can take advantage of institutional change to promote new organizational forms. Drawing on a strategic narrative of the early management consulting industry, we explain how form entrepreneurs can theorize their novel organizations as “solutions” to the “problems” arising from institutional change. We then argue that the legitimacy of new forms can be increased when form entrepreneurs draw on established categories of external expertise, maintain affiliations to the loci of this expertise, cultivate ties to social elites, demonstrate selflessness, and engage in boundary-defining collective action. This theory building extends recent work on cultural-frame institutionalism and directs attention to the social processes involved in new form legitimation. We conclude with suggestions for empirical testing and a discussion of implications for theory and practice.
How do institutional affiliations affect growth and survival?
David, R.J. & Sine, W.D. The Institutional Embeddedness of Management Consulting Firms: Effects of Affiliations to Industry and Professional Associations on Firm Growth and Survival.
We develop and test hypotheses about the effects of affiliations to industry and professional associations on the survival of management consulting firms. Our core argument is that these affiliations serve as a source of organizational social capital, or channel for critical resources and capabilities that consulting firms can use to their advantage. We find that while affiliations generally promote survival, this relationship is moderated by organizational size. For small organizations, a small number of affiliations has a strong positive effect, but marginal benefits decline with increasing affiliations. For larger organizations, benefits are modest at small numbers but rise at higher levels of affiliations. Our results suggest that ties to industry and professional associations are an important way for consulting firms to manage the complex environments they face. In particular, small firms can use these affiliations to overcome some of the liabilities of smallness and thereby close the “survival gap” they face with respect to larger competitors.
What factors determine the degradation of institutional norms?
Institutional theorists argue that organizations adopt institutionalized structures in response to normative pressures, but typically decouple these structures from day-to-day activities in order to meet requirements of their technical environment. Empirical studies in this tradition, however, have focused primarily on the formal adoption of such structures, and to a lesser extent, on their abandonment, and given relatively little attention to understanding factors that determine the extent of decoupling or actual implementation. We argue that implementation is related to the vitality and long-term survival of institutions, and thus is an important aspect of understanding institutional processes. In this context, we offer a theoretical analysis of the conditions that are likely to affect the degree to which organizations implement institutionalized structures, and an empirical examination of the determinants of the use of tenure systems for faculty appointments as a means of testing our arguments. We find that implementation of even a highly institutionalized structure, such as the tenure system, varies widely and is affected by technical as well as institutional pressures.
How do social movements create entrepreneurial opportunity?
Hiatt, S. & Sine, W.D. Soft, Stiff, and In Between: Social Movements, Entrepreneurial Opportunity, and the Emergence of the American Soft Drink Industry.
There is relatively little research that explores the effect of shifting norms, values, and beliefs on entrepreneurial opportunity creation and exploitation within organizational communities. Yet, because norms, values, and beliefs largely dictate the extent to which an organization is perceived as being legitimate, social changes can have lasting impacts on the emergence, survival, and growth of organizations. In this paper, we present a theory that explains how social movement organizations generate entrepreneurial activity by inculcating new values and beliefs into the community and challenging the taken-for-grantedness of organizational forms. We test this theory on the American beverage industry from 1870 to 1920. We find that by deinstitutionalizing certain organizational forms, social movement organizations inadvertently alter population boundaries by creating opportunities for new ventures to emerge and compete with existing firms. This paper directs attention to the primary influence of social movement organizations on organizational community dynamics.
What role do certifications play in the formation of new industrial sectors?
Lee, B., & Sine, W.D. Certifying the Harvest: The Role of Standards-Based Certification Organizations in the Organic Food Industry.
Institutional entrepreneurs are often at the center of efforts to forge a new market. Despite increasing focus on how they precipitate institutional change, there has been little research that ties their actions to market dynamics in new market spaces. Additionally, few studies have considered the role of what we label standards-based certification organizations in structuring these types of interactions in new markets. To address this gap, we explore how standards-based certification organizations, through key processes of creation of standards, advocacy, verification of compliance, and endorsement influence patterns of market entry and exit. Using the U.S. organic food industry as an empirical context and drawing on state level and firm level datasets spanning a fifteen year period (1986-2000), we show that standards-based certification organizations stimulate entry into the market and that the certification they provide to individual firms inhibit market exit and moderate the competitive effects of increasing form density.
Do greater amounts of planning by entrepreneurs increase the survival of new organizations?
Hiatt, S. & Sine, W.D. Clear and Present Danger: Political Turmoil and the Contingent Nature of Planning on Entrepreneurial Firm Survival in Colombia. Forthcoming in the Academy of Management Conference Proceedings (reserved for the top 10% best conference papers).
Strategy and entrepreneurship researchers have long debated the usefulness of business planning in new enterprises. While some researchers maintain that business planning benefits entrepreneurial firms, others contend that planning either contributes nothing or is detrimental to firm performance and survival. The contrasting empirical evidence that accompanies these arguments further expands the apparent rift. In this paper, we attempt to bridge the opposing views by taking a contingency approach to analyzing new business planning. Empirically, we examine 730 Colombian entrepreneurial ventures during the period 1997-2001. The results indicate a curvilinear relationship between planning and entrepreneurial firm survival. We also find that increasing political turbulence also significantly increases the likelihood of firm failure. Our analysis demonstrates that the effects of planning are dependent on context: political turbulence moderates the effects of planning on firm survival, higher turbulence increases the negative effects of planning on the new venture survival.