IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

How Corporate Cultures Coevolve with the Business Environment: The Case of Firm Growth Crises and Industry Evolution

  • Christian Cordes

    ()

  • Peter J. Richerson
  • Georg Schwesinger

    ()

This paper shows how cognitive human dispositions that take effect at the level of an individual firm's corporate culture have repercussions on an industry's evolution. In our theory, the latter is attributable to evolving corporate cultures coupled with changes in a firm's business environment. With the help of a formal model of evolving corporate cultures, we demonstrate how firms can establish a cooperative cultural regime that yields competitive advantages in an innovative, fast changing environment. Depending on within-firm social learning processes and cognitive constraints of human agents, organizations then reach a critical cognitive firm size in their development beyond which the level of cooperation deteriorates rapidly – they systematically face a growth crisis. Organizations successful in such an environment and reaching a critical technological size may, however, reap economies of scale in a later, mature and stable business environment with altered corporate culture. Furthermore, we relate these findings to empirical evidence on firm survival and performance in different industries, the evolution of organizational structures, technological advancements in production technologies, and identify some determinants of market structures.

To our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.

Paper provided by Philipps University Marburg, Department of Geography in its series Papers on Economics and Evolution with number 2009-21.

as
in new window

Length:
Date of creation: Dec 2009
Date of revision:
Handle: RePEc:esi:evopap:2009-21
Contact details of provider: Postal: Deutschhausstrasse 10, 35032 Marburg
Phone: 064212824257
Fax: 064212828950
Web page: http://www.uni-marburg.de/fb19/
Email:


More information through EDIRC

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Lopes, Helena & Santos, Ana C. & Teles, Nuno, 2009. "The motives for cooperation in work organizations," Journal of Institutional Economics, Cambridge University Press, vol. 5(03), pages 315-338, December.
  2. Simon Gachter & Ernst Fehr, 2000. "Cooperation and Punishment in Public Goods Experiments," American Economic Review, American Economic Association, vol. 90(4), pages 980-994, September.
  3. Audretsch, David B, 1997. "Technological Regimes, Industrial Demography and the Evolution of Industrial Structures," Industrial and Corporate Change, Oxford University Press, vol. 6(1), pages 49-82.
  4. U. Witt, 2005. "Firms as Realizations of Entrepreneurial Visions," Papers on Economics and Evolution 2005-10, Philipps University Marburg, Department of Geography.
  5. Cordes, Christian & Richerson, Peter J. & McElreath, Richard & Strimling, Pontus, 2008. "A naturalistic approach to the theory of the firm: The role of cooperation and cultural evolution," Journal of Economic Behavior & Organization, Elsevier, vol. 68(1), pages 125-139, October.
  6. Masahiko Aoki, 2001. "Toward a Comparative Institutional Analysis," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262011875, June.
  7. Joseph Henrich, 2001. "In Search of Homo Economicus: Behavioral Experiments in 15 Small-Scale Societies," American Economic Review, American Economic Association, vol. 91(2), pages 73-78, May.
  8. Williamson, Oliver E, 1981. "The Modern Corporation: Origins, Evolution, Attributes," Journal of Economic Literature, American Economic Association, vol. 19(4), pages 1537-68, December.
  9. Jovanovic, B. & MacDonald, G., 1993. "The Life Cycle of a Competitive Industry," Working Papers 93-34, C.V. Starr Center for Applied Economics, New York University.
  10. David Card & Alexandre Mas & Jesse Rothstein, 2007. "Tipping and the Dynamics of Segregation," NBER Working Papers 13052, National Bureau of Economic Research, Inc.
  11. Oliver E. Williamson, 2002. "The Theory of the Firm as Governance Structure: From Choice to Contract," Journal of Economic Perspectives, American Economic Association, vol. 16(3), pages 171-195, Summer.
  12. Witt, Ulrich, 1998. "Imagination and leadership - The neglected dimension of an evolutionary theory of the firm," Journal of Economic Behavior & Organization, Elsevier, vol. 35(2), pages 161-177, April.
  13. Kurt Dopfer & John Foster & Jason Potts, 2004. "Micro-meso-macro," Journal of Evolutionary Economics, Springer, vol. 14(3), pages 263-279, 07.
  14. Christophe Boone & Glenn R. Carroll & Arjen van Witteloostuijn, 2004. "Size, differentiation and the performance of Dutch daily newspapers," Industrial and Corporate Change, Oxford University Press, vol. 13(1), pages 117-148, February.
  15. Axel Ockenfels & Gary E. Bolton, 2000. "ERC: A Theory of Equity, Reciprocity, and Competition," American Economic Review, American Economic Association, vol. 90(1), pages 166-193, March.
  16. Boyd, Robert & Richerson, Peter J., 1980. "Sociobiology, culture and economic theory," Journal of Economic Behavior & Organization, Elsevier, vol. 1(2), pages 97-121, June.
  17. Jonas Agell, 2004. "Why are Small Firms Different? Managers' Views," Scandinavian Journal of Economics, Wiley Blackwell, vol. 106(3), pages 437-452, October.
  18. Klepper, Steven, 1996. "Entry, Exit, Growth, and Innovation over the Product Life Cycle," American Economic Review, American Economic Association, vol. 86(3), pages 562-83, June.
  19. Rafael Rob & Peter Zemsky, 2002. "Social Capital, Corporate Culture, and Incentive Intensity," RAND Journal of Economics, The RAND Corporation, vol. 33(2), pages 243-257, Summer.
  20. Klepper, Steven, 1997. "Industry Life Cycles," Industrial and Corporate Change, Oxford University Press, vol. 6(1), pages 145-81.
  21. Witt, Ulrich, 2000. "Changing Cognitive Frames--Changing Organizational Forms: An Entrepreneurial Theory of Organizational Development," Industrial and Corporate Change, Oxford University Press, vol. 9(4), pages 733-55, December.
  22. van den Bergh, Jeroen C.J.M. & Gowdy, John M., 2009. "A group selection perspective on economic behavior, institutions and organizations," Journal of Economic Behavior & Organization, Elsevier, vol. 72(1), pages 1-20, October.
  23. Rubin, Paul H., 1982. "Evolved ethics and efficient ethics," Journal of Economic Behavior & Organization, Elsevier, vol. 3(2-3), pages 161-174.
  24. Henrich, Joseph, 2004. "Cultural group selection, coevolutionary processes and large-scale cooperation," Journal of Economic Behavior & Organization, Elsevier, vol. 53(1), pages 3-35, January.
  25. Joseph E. Harrington & Jr., 1999. "Rigidity of Social Systems," Journal of Political Economy, University of Chicago Press, vol. 107(1), pages 40-64, February.
  26. Winter, Sidney G., 1984. "Schumpeterian competition in alternative technological regimes," Journal of Economic Behavior & Organization, Elsevier, vol. 5(3-4), pages 287-320.
  27. Kaushik Mukhopadhaya, 2003. "Jury Size and the Free Rider Problem," Journal of Law, Economics and Organization, Oxford University Press, vol. 19(1), pages 24-44, April.
  28. George A. Akerlof & Rachel E. Kranton, 2005. "Identity and the Economics of Organizations," Journal of Economic Perspectives, American Economic Association, vol. 19(1), pages 9-32, Winter.
  29. Steven Klepper, 2002. "Firm Survival and the Evolution of Oligopoly," RAND Journal of Economics, The RAND Corporation, vol. 33(1), pages 37-61, Spring.
  30. Audretsch, David B & Mahmood, Talat, 1994. "Firm Selection and Industry Evolution: The Post-entry Performance of New Firms," Journal of Evolutionary Economics, Springer, vol. 4(3), pages 243-60, September.
  31. Langlois, Richard N, 1998. "Personal Capitalism as Charismatic Authority: The Organizational Economics of a Weberian Concept," Industrial and Corporate Change, Oxford University Press, vol. 7(1), pages 195-213, March.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:esi:evopap:2009-21. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Christoph Mengs)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.