Wayne E. Baker

Modernization, cultural change, and the persistence of traditional values

Modernization theorists from Karl Marx to Daniel Bell have argued that economic development brings pervasive cultural changes. But others, from Max Weber to Samuel Huntington, have claimed that cultural values are an enduring and autonomous influence on society. We test the thesis that economic development is linked with systematic changes in basic values. Using data from the three waves of the World Values Surveys, which include 65 societies and 75 percent of the worlds population, we find evidence of both massive cultural change and the persistence of distinctive cultural traditions. Economic development is associated with shifts away from absolute norms and values toward values that are increasingly rational, tolerant, trusting, and participatory. Cultural change, however, is path dependent. The broad cultural heritage of a society - Protestant, Roman Catholic, Orthodox, Confucian, or Communist - leaves an imprint on values that endures despite modernization. Moreover, the differences between the values held by members of different religions within given societies are much smaller than are cross-national differences. Once established, such cross-cultural differences become part of a national culture transmitted by educational institutions and mass media. We conclude with some proposed revisions of modernization theory

Market Networks and Corporate Behavior

Data on market relations between a large population of corporations and investment banks are used to study the organization-market interforce-the pattern of direct market ties between a firm and its banks. Forms of interfaces range from a long-term, exclusive tie (the relationship interface) to many short-lived, episodic ties (the transaction interface), with hybrid forms between the two poles. Contrary to widespread belief, the article finds that strong relationships still exist. Transactions interfaces are rare. Most firms use hybrid interfaces. A firms interface is conceptualized as the intentional result of its efforts to reduce dependence and exploit power advantages. Observed interfaces are shown to be related systematically to various power-dependence concepts, including resource intensity (number of transactions and dollar amounts raised), criticality (the availability of resource alternatives), power asymmetry between a firm and its main bank, organization size, standardization of exchange, and the use of tandem strategies (director interlocks).

The Small World of the American Corporate Elite, 1982-2001

This paper examines the degree of stability in the structure of the corporate elite network in the US during the 1980s and 1990s. Several studies have documented that board-to-board ties serve as a mechanism for the diffusion of corporate practices, strategies, and structures; thus, the overall structure of the network can shape the nature and rate of aggregate corporate change. But upheavals in the nature of corporate governance and nearly complete turnover in the firms and directors at the core of the network since 1980 prompt a reassessment of the networks topography. We find that the aggregate connec tivity of the network is remarkably stable and appears to be an intrinsic property of the interlock network, resilient to major changes in corporate governance. After a brief review of elite studies in the US, we take advantage of the recent advances in the theoretical and methodological tools for analyzing network structures to examine the network properties of the directors and companies in 1982, 1990, and 1999. We use concepts from small-world analysis to explain our finding that the structure of the corporate elite is resilient to macro and micro changes affecting corporate governance.

Role as Resource in the Hollywood Film Industry

The theoretical concept of role as resource is introduced and illustrated. The concept combines critical elements of the structural, interactionist, and network approaches to role. A role is a resource in two senses: it is a means to claim, barbain for, and gain membership and acceptance in a social community, and it grants access to social, cultura, and material capital that incumbents and claimants exploit in order to pursue their interests. This article examines the impact of a major transformation-the rise of the blockbuster-on roles and positions in Hollywood filmmaking and discerns two processes underlying the growth and decline of roles in culture production. Through adaptation, filmmakers adopt role combinations with intrinsic capabilities of solving technical and organizational problems. Through imitation, filmmakers copy the role combinations associated with early blockbusters and gain legitimacy in Hollywoods institutional environment. These responses resulted in two fundamental trends: the increasing specialization of the producer and separation of the business and artistic domains, and the increasing fusion of artistic roles.

Hazards of the Market: The Continuity and Dissolution of Interorganizational Market Relationships

The authors propose a theory of the market as an intertemporal process that integrates multiple theoretical perspectives. Using event-history methods, thery analyze the dissolution of interorganizational market ties between advertising agencies and their clients as a function of three forces - competition, power, and institutional forces. The informal rules of exchange institutionalized in the emergence phase of the advertising services market include exclusivity (sole-source) and loyalty (infrequent switching). They find that most exchange relationships between advertising agencies and their clients are indeed exclusive, and most last for several years; but competition, power, and institutional forces support or undermine these rules. Most institutional forces reduce the risk of dissolution of agency-client ties. Powerful advertising agencies mobilize resources to increase tie stability, but powerful clients mobilize resources to increase or decrease stability. Competition is the weakest market force, but it has a consistent and substantial effect on tie dissolution : competition always increases the risk of dissolution. They conclude that the market is institutionalized as imperfectly repeated patterns of exchange, because competition and changing norms about the duration of market ties destabilize market relationships

Social networks and loss of capital

Economic sociologists and white-collar criminologists offer competing predictions about the outcomes of socially embedded transactions. Economic sociologists stress the protective and beneficial role of social networks. Their evidence shows that social ties improve transaction outcomes. White-collar criminologists focus on the harmful and exploitative role of social networks. Their evidence shows that social ties facilitate successful economic crimes. Our case permits a critical test of the protective versus harmful effects of social ties: a business that operated as a legitimate enterprise and also engaged in ongoing financial fraud. This case is strategic because the role of social networks ex post is theoretically ambiguous for a legitimate-fraudulent business. Do social networks lower, raise, or have no effect on the probability of loss of capital, given that an investment has been made? The probability of loss of capital depends on due diligence and type of social tie. Investors who fail to conduct due diligence and do not use social ties have a 79% probability of loss of capital, controlling for other factors. Investors who conduct due diligence (and do not use social ties) have a 49% probability. Investors with preexisting social ties to the principals, sales representatives, or employees of the company (and do not conduct due diligence) have a 39% probability of loss, while those with this type of social tie who also conduct due diligence have a 14% probability. Investors with preexisting social ties to prior investors are not significantly more or less likely to lose their capital. Even in a business that was partly fraudulent, preexisting social ties to the company played a protective and beneficial role. Ironically, fraudulent behavior lowered the probability of loss for investors with this type of social tie: Illegal practices allowed the company to favor friends and acquaintances in the ex post allocation of proceeds.

Strategies for Managing Suppliers of Professional Services

Professional services—advertising, financial services, legal services, management consulting, and others—are critical inputs and major corporate expenditures. Yet managers of suppliers of professional services lack a concrete management framework for enhancing value and controlling costs. This article provides a practical framework, based on extensive research, that incorporates four generic strategies for managing suppliers of professional services. These strategies can increase efficiency, reduce costs, improve quality, and strengthen bargaining power. While sole-source strategies often make sense for managing industrial parts suppliers, multiple-source strategies maximize the value of professional services. Corporate managers who resist offers for one-stop shopping and cross-selling—who instead develop credible internal alternatives, link pay and performance, and increase monitoring and auditing—can significantly enhance the value of professional services.

Social Capital by Design: Structures, Strategies, and Institutional Context

We examine social entrepreneurship from a structural perspective, distinguishing between two structures of social capital and their associated entrepreneurial strategies: structural holes and the ‘disunion’ strategy versus social cohesiveness and the ‘union’ strategy. These two strategies represent alternative ways social entrepreneurs access and mobilize the resources inherent in the structure of a social network. The disunion strategist exploits structural holes between alters by keeping them apart; the union strategist creates value by bringing together disconnected alters. The frequency, legitimacy, and success of each strategy depends on the ‘design’ of the institutional context in which social entrepreneurs operate. Disunion strategies tend to occur in organizations and markets characterized by sparse, disconnected, and differentiated networks, coupled with competitive rules of exchange, opportunism, and an individualist orientation; union strategies tend to occur in organizations and markets characterized by dense, connected, and undifferentiated networks, coupled with cooperative rules of exchange, norms of reciprocity, and a collectivist orientation. We illustrate the distribution of triadic strategies in a specific institutional context by taking a triads census of alliances in the global automobile industry and testing the structural hypothesis about the use of disunion and union strategies.

Information networks and market behavior

This paper proposes a mathematical model of financial markets as networks. The model examines the effect of network structure on market behavior (price volatility and trading volume). In the model, investors are arrayed in various network configurations through which they gather information to make trading decisions. The basic network considered is a chain graph with two parameters, number of investors (n) and the length of time in which information is transmitted (k). Closed‐form expressions for price volatility and expected trading volume are provided. The model is generalized to more complex networks, focusing on the hub‐and‐spoke network. The network configurations analyzed do not represent the real (and unknown) communication network among investors, but predictions from the model are consistent with price and volume patterns observed in sociological and economic research on financial markets. The main result is that network structure alone influences price volatility and expected trading volume even...

Differences in self-rated health by immigrant status and language preference among Arab Americans in the Detroit Metropolitan Area

Arab Americans are a growing minority in the U.S., yet only a few studies have examined their health utilizing representative samples. Using data from the 2003 Detroit Arab American Study, which is based on a probability sample, we examined the self-rated health (SRH) of Arab Americans by two measures of acculturation--immigrant status and language preference. We specified logistic regression models to test whether immigrants report better or poorer health status compared to U.S.-born Arab Americans and whether language preference among the immigrant generation accounts for the association between immigrant status and SRH. Our findings reveal that the health status of Arab Americans improves with acculturation. Arab immigrants are more likely to report poorer SRH compared to U.S.-born Arab Americans. When language preference is taken into account, Arabic-speaking immigrants are more likely to report poorer SRH compared to both U.S.-born Arab Americans and to English-speaking immigrants. We discuss these findings in light of similar ones obtained in the literature on SRH among other immigrant groups in the U.S. We conclude by arguing that language is an important measure to include in SRH studies among Arab Americans as well as other non-English speaking ethnic groups.