NASP International and Interdisciplinary Seminars

Rafael Wittek (University of Groningen)
Institutions and cooperation decay. Four governance traps and how to avoid them

Chair: Flaminio Squazzoni (University of Milan)

18th March 2022, h. 14.30
NASP Graduate School in Social and Political Science
Room B, Via Pace 10 Milan 
and on Zoom

Abstract:
Whereas some organizations are remarkably successful in sustaining the cooperative relations constituting their core processes, others face (recurrent) disruptions and decay of cooperation, thereby severely undermining the organization's ability to create value. To what degree can these differences be explained by variations in the organization's institutional arrangements? I argue that current theories of institutions and organizational governance are ill-equipped to answer this question, for two reasons. First, they are based on an outdated behavioral micro-foundation that either stresses rational gain seeking or prosocial preferences as the major driver of human action. Second, their tools to describe institutional arrangements are too coarse-grained to adequately capture important variations in their relational infrastructures. This presentation explores how to close these gaps. My argument comes in five steps. Using a social rationality approach, I first outline the contours of an alternative explanatory framework. Distinguishing between two types of managerial control philosophies (rational vs. normative) and two forms of control (bureaucratic vs. collegial) I then review the four major theoretical templates that currently inform the design of institutions and organizational governance structures: agency, stewardship, reputation, and social identity theory. Drawing on available empirical evidence, I subsequently describe how each of these design principles may trigger vicious cycles of cooperation decay. I refer to these processes as incentive, reputation, empowerment, and identity traps. I contend that the common denominator behind each of these sustainability traps is that the institutions in place fail to support the normative goal frame required to sustain joint production motivation. I then present findings from selected empirical studies showing how specific relational support structures may prevent the emergence of these governance traps, or mitigate their consequences. I conclude with a discussion of implications for future research on institutions and sustainable cooperation.

This seminar is part of the NASP International and Interdisciplinary Seminars Series 2022.