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Historical institutionalism, critical realism and morphogenetic social theory – towards a synthesis of explaining why history matters in

organisations?

By Ian Greener, Department of Management Studies, University of York,

Heslington, York, YO10 5DD

Telephone 01904 434651, ig6@york.ac.uk

Abstract This paper explores the difficulties with both the theoretical content and application of the concept of ‘path dependence’ in organization studies, but suggests that, by combining it with insights from morphogenetic social theory, we can provide a coherent framework for its use. After providing a brief survey of the literature on path dependence, it presents a summary of the most significant criticisms made of the approach. The paper then moves on to examine morphogenetic social theory and its potential to meet these criticisms before concluding by characterising the elements of a path dependent system incorporating insights from both new institutionalism and morphogenetic social theory.

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Historical institutionalism, critical realism and morphogenetic social theory – towards a

synthesis of explaining why history matters in organisations?

Abstract

This paper explores the difficulties with both the theoretical content and application of

the concept of ‘path dependence’ in organization studies, but suggests that, by combining

it with insights from morphogenetic social theory, we can provide a coherent framework

for its use. After providing a brief survey of the literature on path dependence, it presents

a summary of the most significant criticisms made of the approach. The paper then

moves on to examine morphogenetic social theory and its potential to meet these

criticisms before concluding by characterising the elements of a path dependent system

incorporating insights from both new institutionalism and morphogenetic social theory.

Introduction – historical institutionalism and path dependence

Path dependence is an increasingly widely used concept not only in economic and

business history, but also in sociology and political science. But given it’s widespread

use, it is striking how differently the concept is used from discipline to discipline. The

first widely-cited cases using the concept were arguably those of Arthur, where abstract

ideas based on Polya urns were used to show how positive feedback mechanisms meant

that small changes in the ‘initial settings’ of particular experiments had big implications

for their form and structure later on (Arthur, 1989, 1990, Arthur et al, 1983). Arthur went

on to show how economies had positive feedback mechanisms too, suggesting that stock

markets and a range of other economic phenomena could be better modelled using

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positive feedback mechanisms. Arthur’s work on path dependence (1989, 1990, Arthur et

al, 1983) provides a series of discussions on how positive feedback mechanisms pervade

economics (in contrast to more traditional assumptions that are concerned with

equilibrium concepts, and so negative feedback). Arthur is keen to demonstrate the sub-

optimality that can result from possible multiple equilibria being subject to positive

feedback mechanisms, and so inferior technologies becoming ‘locked- in’ to dominance

through little more than chance (Arrow, 2000, David, 1985, 1997). Political studies based

around Arthur’s work tends to make extensive use of multiple equilibria and positive

feedback, and so suggest a framework where there are initially multiple possibilities from

which a sensitivity to the ‘initial conditions’ of the political situation lead to a particular

policy or institution becoming ‘locked in’ through a series of contingencies, and then

maintained through some kind of positive feedback mechanism (Goldstone, 1998).

Arthur’s work appears to be a central influence on Nobel prize-winner Kenneth Arrow

who began to incorporate positive feedback mechanisms into economics (Arrow, 2000).

Paul David produced controversial accounts of the development of the QWERTY

keyboard, wondering why despite the now existence of technologically superior

alternatives, did we continue to utilise a layout the original adoption of which was based

upon a constraint, the prevention of manual typewriter key levers from jamming, that was

no longer relevant (David, 1985, 1997). David’s answers, again, were largely based on

positive feedback mechanisms, the externalities that the adoption of the QWERTY

keyboard, and the sunk costs that result from so many individuals learning to type using

the layout. At the same time, he provoked an argument as to whether economic

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rationality was a good model to be using in understanding technological development

(Liebowitz & Margolis, 1995).

In Business and Management, the Strategic Management Journal is now dominated by

accounts of industrial development and change based on the resource-based view of the

firm, which makes extensive use of path dependence in a similar guise to Arrow, David

and Arthur, to explain how firms can achieve competitive advantage by developing

difficult-to-replicate combinations of human and technological capital (Jocobides &

Winter, 2005, Miller, 2002, Rouse & Daellenback, 2002, Vassolo et al, 2004). What

these accounts share with Arthur, Arrow and David is their reliance upon the neo-

classical theory of the firm, an approach that places at its centre the utility-maximising

rational man. This undoubtedly has strengths in terms of creating opportunities for

utilising economic theory as a theoretical underpinning for accounts of the development

of business organisation, with the parsimony and simplicity this allows.

But in other academic disciplines a very different approach to path dependence is

appearing. In sociology and politics path dependence tends to be used in a very different

way with very different underpinning theoretical assumptions.

Within political studies, the most significant account of path dependence comes from

historical institutionalism, the central claim of which is that choices formed when an

institution is being formed, or when a policy is being formulated, have a constraining

effect into the future (Hall & Taylor, 1996, Koelble, 1995, Peters, 2001). This dynamic

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occurs because institutions and policies have a tendency towards inertia; once particular

paths have been forged, it requires a significant effort to divert them onto another course.

‘History matters’ because formations put in place in the early stages of an institutional or

policy life effectively come to constrain activity after that point (Peters, 2001, Skocpol,

1992).

Arguably historical institutionalism’s most distinctive feature is an image of social

causation that is based around the notion of ‘path dependence’ – the means by which the

‘historical’ gets into historical institutionalism. Path dependence has become, within a

relatively short space of time, a widely-used concept (see, for example, Alexander, 2001,

Arrow, 2000, Berman, 1998, Bruggeman, 2002, Garud & Karnoe, 2001, Greener, 2002a,

2002b, Hansen, 2002, Hedlund, 2000, Holzinger & Knill, 2002, Mahoney, 2001, O'Brien,

1996, Pierson, 2000a, Scott, 2001, Sterman & Wittenberg, 1999, Torfing, 1999, 2001,

Wilsford, 1994), but studies often have remarkable little in common in terms of their

conceptual framework or approach.

Interestingly, it is not because writers on path dependence have ignored theory that so

little consensus has appeared in writings concerned with the topic. Attempts have been

made to try and consider how we might construct a framework for specifying what

elements and circumstances combine to form a path dependent system (Goldstone, 1998),

and how path dependent systems manage to reproduce their form (Mahoney, 2000, 2001,

Pierson, 1993, 2000b, Thelen, 1999, Thelen & Steinmo, 1992). Mahoney (2000, 2001)

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goes further than this, suggesting that maintenance might occur through either positive

feedback or ‘reactive’ mechanisms of interplay between interest groups.

Criticisms of path dependence

A number of specific criticisms emerge from the literature that we must consider if we

are to if we are to use path dependence as a coherent framework in organizational

analysis.

First, there is the problem we alluded to above. If much of the organisational literature on

path dependence depends on rationalising economic man at its theoretical core, then we

find ourselves stuck in attempting to construct ever more theoretically-elaborate

considerations to attempt to come up with complex reasons why individuals in

institutions are behaving in what is, according to the tenets of economics, such an odd

way. We can see this in the work of Schwartz (Schwartz, 2003) which, although is

logically rigorous and is clearly sincere in attempting to further the rational choice

agenda into understanding path dependence, is unpersuasive as it is so clearly predicated

upon homo economicus that it automatically discounts other ways of understanding path

dependence that are surely relevant.

But the problems do not end if we place instead an alternative model of path dependence

at the core of our modle. Many of the problems with what we might term the ‘political

studies’ approach to path dependence come from its intellectual roots in historical

institutionalism. First, if path dependent processes preserve the history in their formation,

how do we break free from them? If history matters so much, how do we break from it?

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How does change occur (Gorges, 2001, Hira & Hira, 2000) ? In historical institutionalism,

patterns of behaviour come to resemble ‘punctuated equilibria’ (Krasner, 1984), where

substantial change is only possible in ‘critical junctures’ (Collier & Collier, 1991) or

‘policy windows’ (Kingdon, 1995, Kingdon, 1996) before institutions and policies once

again settle down onto a new path, and inertia becomes the norm. Hall and Taylor (1996

p. 942) admit that well-developed responses to the question of why critical junctures arise

have not yet been formulated – change is effectively an exogenous feature of the model.

Second, what exactly is the role of ideas in path dependence (and historical

institutionalism generally) (Blyth, 1997)? What is the relationship between ideas and

history, and how can they combine to create continuity and resist forces for change in the

past? Path dependence often attempts to locate institutions in a causal chain that gives a

substantial role the development of ideas (Hall, 1993, Mahoney, 2001, Torfing, 1999,

2001), but that has also led to some substantial criticisms of the approach with claims that

ideas are not treated in a systematic and coherent way (Blyth, 1997), and that ideas are

being used as a means of ‘propping up’ the institutionalist research agenda without

appropriate care.

Third, how can we characterise the feedback mechanism through which path dependent

processes prevent change? Are they subject to increasing returns and positive feedback

mechanisms (Arrow, 2000, Arthur, 1990, Pierson, 2000b) or can we include negative

feedback mechanisms as well(Mahoney, 2000)? If we include both kinds of feedback

mechanisms, are we at risk of losing the distinctiveness of path dependence as a concept

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(Schwartz, 2003), so reducing its use to a loose metaphor rather than a clearly defined

framework for analysis?

Finally, Pierson, one of the most significant writers on path dependence, (see, for

example, Pierson, 1993, 1996, 2000b, 2000c), has commented that the diversity of studies

now being published under its name, risks ‘concept stretching’ (Pierson, 2000b p. 252)

occurring, and the risk of it becoming meaningless.

These are considerable problems. To attempt to resolve them, we turn to morphogenetic

social theory to argue that it holds considerable complementary explanatory power, and

by incorporating key insights from it, we can more clearly elaborate what we mean by

path dependence and so find solutions to many of the problems raised by its critics.

Morphogenetic social theory

Morphogenetic social theory (Archer 1982a, 1982b, 1995, 1996a, 1996b, 2000a, 2000b)

provides an analytical approach based around the ontology of critical realism (Archer et

al 1998). Archer’s ideas have been discussed extensively within sociology (King 1999,

Reed 1997, 2001, Stones 2001, Willmott 2000), but appear to have not yet been applied

to institutionalist approaches, even though there is an increasing body of work that that

utilises the approach in organizational theory (Ackroyd & Fleetwood, 2004, Reed, 1997,

2001). The morphogenetic approach divides analysis into three inter-related stages. First

it suggests we should analyse the structural and cultural ‘conditionings’ that act as an

influence on human actors, and which create ‘emergent properties’ and ‘situational

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logics’ for their interactions with them (see below). Second, it explores how these

conditioning factors influence actors within the system through their interactions with

them, primarily in the form of their behaviour in vested interest groups. The third and

final stage analyses the result of these interactions, and the resulting conditioning effects

that will feed into the next morphogenetic cycle.

As well as having specific analytical stages, we can characterise the morphogenetic

approach as having two particular ontological characteristics derived from critical realism

that are especially distinctive. First, there is an analytical separation between structure

and agency. Morphogenetic social theory recognises the interdependence of structure and

agency, but claims that the two are analytically separable because of the additional

insights that can be generated in this way. So in stage one of the morphogenetic cycle, we

analyse the structural and ideational influences present in the organizational system,

before considering how these interact with human agency in stage two, and the result of

those interactions in stage three. As such, we have a distinctive means of approaching the

debate between structure and agency that has been at the heart of debates on historical

institutionalism (Hall & Taylor, 1996, Hay & Wincott, 1998). In addition to this there is a

genuine sense of the role of history in each morphogenetic cycle we analyse – we see the

interactions between pre-existing ideas and structures and human actors unfold before us

(see Archer's extended examples in 1995, 1996).

Second, morphogenetic social theory also specifies an analytical separation between

‘structural’ and ‘cultural’ systems. This means that we examine the realm of institutions

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(the structural system) separately from the realm of ideas (the cultural system), and so

deal explicitly with Blyth’s (1997) criticism that ideas are not treated seriously within

historical institutionalism, as they acquire an analytical dimension all of their own. As

with structure and agency, morphogenetic social theory does not treat ideas and structures

as systems that do not interact, but instead suggests they should be treated as being

separable because of the additional analytical power that this approach creates. We will

specify below how this applies to the specific area of path dependence.

Examining a morphogenetic cycle then, consists first of specifying the structural and

cultural influences upon the organization that we are analysing. Morphogenetic social

theory utilises two specific means of analysis in its first stage. First we must consider the

‘emergent properties’ of the system in both structural and cultural spheres. An emergent

property can be either ‘necessary’ in which relationships between those dominating the

system are recognised by all the parties involved as being inter-dependent, or

‘contingent’, in which vested interests in the dominant faction believe they are able to

work relatively autonomously from one another. As well as this, emergent properties are

either ‘compatible’, in which the dominant vested interests have a considerable amount

either culturally or structurally in common, or ‘incompatible’, in which case they aren’t.

By specifying the nature of the dominant vested interests in terms of the extent of their

interdependence and compatibility in both the structural and cultural spheres we are able

to assess the probability of their ability to preserve their position (we can hypothesise that

necessary relationships tend to be longer- lasting than contingent ones) and their

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likelihood of conflict (we can hypothesise that compatible relationships tend to be less

conflictual than incompatible ones).

Second, we must consider the ‘situational logic’ that the emergent properties are likely to

create. The combinational possibilities, along with their likelihood of path dependence,

are shown in table one below.

Table one – the likelihood of path dependence from structural and situational logics

Emergent property (in

phase two of

morphogenetic cycle)

Structural situational

logic

Cultural situational

logic

Likelihood of

path

dependence

Necessary

complementarities

Protection Protection Highest

Necessary

incompatibilities

Compromise Correction leading

to syncretism

High -

Medium

Contingent

incompatibilities

Elimination Choice (forcing of) Lowest

Contingent

compatibilities

Opportunism Cultural ‘free play’ Low

Derived from Archer (1995, p.218)

A morphogenetic analysis of path dependence

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In morphogenetic terms we can hypothesise a path dependent system as most likely to

emerge where both structural and cultural vested interest groups are dependent upon one

another to hold power (a ‘necessary’ emergent property). Where structural interest groups

are dependent upon each other (‘necessary’) and their goals are compatible, this leads to a

situational logic where interest groups attempt to ‘protect’ themselves. This is especially

powerful where the dominant cultural ideas utilised by vested interests are also

compatible – and the greater the compatibility the greater the possibility of generating

increasing returns in the system we are investigating. This combination of powerful

structural interests plus mutually compatible ideas is the most stable of the ‘morphostatic’

(or stable) cycles Archer posits (Archer, 1995 pp. 308-312), and so, is the most likely to

condition path dependence.

The production of path dependence through increasing returns is therefore most likely to

occur in systems where necessary complementarities exist in both the structural and

cultural systems. It may also occur where there are necessary incompatibilities in either

the structural or cultural system, especially when allied to a necessary complementarity in

the other. Where there are contingent incompatibilities in both the structural and cultural

systems (vested interests have rival structural or cultural loyalties based around

differences of opinion that cannot be easily resolved), the likelihood is reduced, however.

As we can see from the table above, emergent properties with ‘contingent’ relationships

(where vested interest groups are not dependent upon on another) tends to lead to

situational logics that favour non-stable (morphogenetic) outcomes such as ‘elimination’

of rival groupings, and so have a low likelihood of being path dependent. The results of

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the conditionings from these combinations are more likely to result in change than

continuity.

We therefore have a means of explaining systemic continuity, but also need a clearly

specified mechanism for change (Hira & Hira, 2000). In a morphogenetic- inspired model

of path dependence, forces for change can come endogenously or exogenously, or both. If

we have ‘necessary’ and ‘compatible’ relations in both structural and cultural spheres, we

have the most powerful force for morphostasis (continuity), with actors engaged in a

logic of protection in both areas. Even this, however, can eventually lead to change

because of the very limited range of legitimising ideas that are being drawn from

(extreme specialism can ultimately lead to irrelevance), or through the structural vested

interests groups becoming so insular that they engage in factional infighting, and wars on

‘deviant’ groups or ideas to the extent that they actually cause these groupings to begin to

establish separate identities and differentiated ideas (Archer, 1995 pp. 237-239). Change

may also come from exogenous factors, such as a wider shift in structural societal

relations at the level of international political economy (‘fiscal crises’ for example), or

through the emergence of challenging ideas that are backed by vocal and powerful vested

interests (this is more or less the argument as presently presented in most historical

institutionalist analyses that utilise path dependency (Greener, 2002b) (.

Equally, in less stable versions of path dependence, where the structural or cultural

systems have a built- in incompatibility, attempts at ‘compromise’ or ‘syncretism’ can

break down, and vested interest groups attempt to achieve greater power for themselves.

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This, again, can come about as a result of either endogenous or exogenous factors.

Endogenous change would come about as a result of a significant group no longer being

able to sustain the incompatibility built into the system, and so fragmentation occurring

despite attempts from structural or cultural vested interests to continue to compromise.

Exposure of incompatibilities would tend to result in greater mobilisation from other

vested interest groups against them, and the likelihood that actors would be forced into

choices about whether or not they would continue to support the dominant coalition or

idea.

Situational logics do not create compulsory rules for those operating within them, but

actors do to have to work within the context where they prevail. As such, the opportunity

cost of working against them is likely to be high – in other words particular

configurations of these ‘emergent properties’ are more likely to lead to path dependence

than others, and a change in emergent properties resulting from interaction between

actors and the situational logics that they face will result in the system become either

more morphogenetic (generating change) or morphostatic (generating continuity) ,

depending upon the new prevailing situational logic.

Towards a framework for the analysis of path dependence

From the insights generated above from both existing path dependence literature and

Archer’s morphogenetic approach, we are now in a position to specify a framework for

considering path dependence in organizational processes.

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First, path dependent processes begin with multiple equilibria situation (Goldstone, 1998,

Mahoney, 2000, Pierson, 2000a). We must be able to demonstrate that a number of viable

alternatives existed for the development of the policy in question, or for the development

of the institutions we are examining. Leading on from this is the second element; that

contingent events must be shown to have played a substantial role in establishing the

particular policy or institutional form that emerged.

Third, we must specify the conditions in which we would expect path dependent systems

to reproduce their form and ‘lock-in’ to occur. The use of insights from morphogenetic

social theory allow us, through the analysis of the relationships between vested interests

in the structural and cultural spheres, to begin to generate hypotheses about the likelihood

of continuity occurring. After the period of production, a period of reproduction appears

during which the policy or institution must generate feedback mechanisms that create

inertia, or possible even increasing returns to ‘lock out’ competing ideas and vested

interests. Once the logic of path dependent policy or institution has been established, it

will tend generate an inertial force where established vested and cultural interests have a

high opportunity cost for challenging the system (based on a ‘necessary’ relationship both

within and between the groups). This will tend to lead to morphostasis, which is most

likely to appear where ‘necessary’ emergent properties are reproduced in the policy or

institution.

Critics of path dependence have, as we noted above, made great store of the lack of

specificity in the model of the nature of the returns that the model is specifying. Pierson

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(Pierson, 2000b, 2000c), basing his work on Arthur (1989, 1990), makes clear that he

believes that path dependent systems are the study of positive returns, but this approach is

logically flawed. Were positive returns to dominate a system for a considerable period of

time, it would eventually lead to the removal of all opposition as the influence of the

dominant idea or vested interest became so widespread that there would no longer be

anywhere left for notions or interests that challenged them. This would effectively take

away the opportunity for change completely, short of an exogenous shock. In the world

of physics, where models of path dependence consider stable equilibria generated by the

selection of coloured balls from bags, this lack of internal change be possible, but in the

world of organizational studies we need some modification of the idea. As such, it makes

sense to hypothesise, in line with the insights above, that a path dependent system might

go through, in its creation phase, a period where increasing returns are generated. Once it

enters its reproduction phase, however, it seems unlikely that anything greater than the

preservation of the status quo is possible – a situation more in line with constant than

increasing returns. As Schwarz notes (2003) there are considerable costs involved in

keeping things the same. We are able, by analysing emergent properties and their

corresponding situational logics, the difficulties involved in keeping the system on its

particular path, and the likely costs involved.

Finally, as we noted above, we have a mechanism for change in a path dependent system,

located not in the cultural or structural spheres, nor in human agency, but in the

interactions between all three. The analytical separation of cultural and structural systems

allows us to examine the role of ideas as well as structure in organizational analysis, and

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the analytical separation of both from human agency through the three-step

morphogenetic cycle allows us to see the process through which change unfolds from

apparent continuity before us. We have no need to make the source of change an

exogenous factor in our model, as historical institutionalism tends to do.

The importance of path dependence – a brief example

We can illustrate the above approach through the use of a brief example based on the

author’s own research into the UK National Health Service (see for examples Greener,

2001, 2002a, 2002b, 2003, 2004, Greener, 2005). The NHS at its creation in 1948 is

perhaps regarded as an organization based on a compromise between the state and the

medical profession within which both parties entered into a tacit agreement. The state

agreed to allow the doctors considerable autonomy in the operational control of the NHS

on the one hand, and the doctors allowed the state to set the budget for the NHS, within

which they would endeavour to keep (Klein, 2001). The relation between the state and

the medical profession was therefore necessary in nature – the state needed the medical

profession for the NHS to work, and the medical profession needed the state in a time of

wholesale health organisation nationalisation. Between the consultant elite and the

Secretary of State for Health, Anuerin Bevan, there was also a complementary emergent

property – they saw that each had the others’ interest at heart (Honigsbaum, 1989), and so

a bargain was reached rather quickly in which Bevan famously claimed he had ‘stuffed

their mouths with gold’. There was a strong contingent element in Bevan’s negotiating

stance, being considerably based on the quick decisions that consultant representatives in

the Royal Colleges could provide him versus the rather more democratic, ponderous

decision made by the BMA, who largely represented the GPs. This meant that the relation

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between the state (as represented by Bevan in negotiations) and the GP’s, however, was

rather more difficult, and although it can still clearly be categorised as necessary, was

rather more incompatible, because GPs wished to effectively remain independent

contractors in the NHS, and balked at Bevan’s suggestion that they, like the consultants,

should effectively become state employees.

This led to a situational and cultural logic of ‘protection’ between the state and the

consultants, and a high degree of path dependence in their relationships. Between the

state and the GPs, however, it led to a structural logical of compromise, and a cultural

logic of correction or syncretism, in which the two interests had something of a more

abrasive relationship, and although the potential for path dependence was significant– the

relationship between the two had somewhat reduced capacity for mechanisms of

reproduction than the mutually enforcing one between the state and the consultants.

This simple analysis sets the scene for the first forty years of the NHS remarkably well.

Once established, consultants and the state did remarkably well in leaving one another

alone, with the state constructing ever more elaborate means of allocating funding, and

the consultants securing greater and greater representation and control over their hospital

fiefdoms. Flashpoints between the two occurred if the state attempted to remove any of

the privileges afforded to the consultants (see especially Klein, 1979, Klein, 1983), or

over attempts to introduce reforms of which the consultants did not approve (Greener,

2001) but the main source of friction for the NHS was between the state and the GPs.

This is because the situational logic of correctio n began to assert itself, especially as

19

general practitioners got more organised in the 1960s, and began to demand greater

equality of pay and conditions with their consultant colleagues (Rivett, 1998). We can see

a series of compromises over contracts, pay and conditions that meant the GPs found

themselves rather more often threatening industrial action.

By the 1980s, and the negotiations leading up to the creat ion of the first internal market

in the NHS (Secretary of State for Health, 1989), the state appeared to be adopting a

rather more confrontational approach than any of its post-war predecessors. Despite the

concern of the Prime Minister, Secretary of State for Health Kenneth Clarke appeared to

be more than prepared to confront and challenge both consultants and GPs in the name of

improving efficiency in the NHS through the introduction of the internal market

(Timmins, 1995a, 1995b). We can view this as the beginning of the state realising the

potential to view its relationship with the medical profession as being contingent rather

than necessary. This offered the state potential to put in place radical reform. Doctor

representation groups, now themselves angered by the relatively low funding given to the

NHS and a cumulative funding gap that was emerging (Ham, 1999), launched a

campaign that attempted to get the government to back down, but failed. This period

looked a lot like an unpleasant divorce, with a logic of elimination appearing, and of

prominent representatives from both state and medical profession apparently presenting a

cultural logic of choice – you were either with the reforms or against them with little

scope for any other position.

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The reforms, however, were not fully implemented as Clarke had planned (Greener,

2002b, West, 1998), and a logic of compromise appears to have been re-established for

much of the 1990s. It is remarkable how conciliatory toward the medical profession New

Labour were on their return to power in 1997 (Secretary of State for Health, 1997),

presenting a consultative and almost Fabian approach to the NHS. But the contingent

relationship appears to now be firmly entrenched; a series of NHS reforms since 2000 has

meant that we now see widespread introduction of private sector providers into the NHS,

the introduction of patient choice a second internal market apparently based around it,

contracts with clearly defined duties on the part of doctors, and a structural logic that the

state is prepared to directly challenge any attempt by the medical profession to stand in

the way of reform. The logic cannot be one of elimination because the state clearly still

needs the doctors for the NHS to function, but it is increasingly finding ways of breaking

up local cartels created by the medical profession to allow private practice, and there is

certainly a distinct lack of compromise. In short, the state appears to be doing all it can to

reassert a contingent emergent property to the system, and create a situational logic where

it is prepared to let individual hospitals follow the path of unsuccessful schools in

education reforms, that is, to closure.

In sum, the path dependence present in the NHS can be successfully described in terms of

the path dependence between the state and the medical profession established in 1948,

but is now under serious threat because of the move from its relationship being necessary,

to being more contingent. This has meant a movement from a situational logic of

protection and compromise, to one instead of elimination and the forcing of choice, as the

21

interests of the state and the medical profession appear to have diverged under the new

public management (Dunleavy & Hood, 1994, Hood, 1991).

Conclusion

Path dependence can be retrieved from the rather unsystematic use to which it is

presently put. Its combination with morphogenetic social theory appears to be a

potentially fruitful one. In providing a more coherent framework for its use, and

combining it with coherent social theory and ontology, we can both deepen its analytical

content as well as provide a basis from which hypotheses and comparative studies about

organizational continuity and change can be drawn. Path dependence has considerable

potential for providing the basis for substantial empirical studies of the linkages between

policy and organisation continuity and change with the relationships within institutions

that shape the behaviour of agents and the structural and cultural conditionings that act

upon them. Providing a more detailed framework than presently exists allows

comparative cases to be constructed in a more systematic way, and for us to understand

the complex processes making up organizational life to be better understood.

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Acknowledgements

Thanks to Hugh Pemberton for organising the specialist stream on Path Dependence at

the PSA Annual Conference at Leicester University in 2003, to Fiona Ross for her

encouragement and criticism at that panel, and to Herman Schwartz for his provocative

and incisive critique.

23

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