Jb. Wade et al., Normative and resource flow consequences of local regulations in the American brewing industry, 1845-1918, ADM SCI QUA, 43(4), 1998, pp. 905-935
In this study, we investigate the impact of state-level prohibitions on the
founding and mortality rates of breweries in prohibition-free states. Our
results suggest that particularistic institutional action such as nonunifor
m government regulation creates externalities of two kinds. First, it creat
es resource flow opportunities for organizations that are not directly affe
cted by such action. Second, it imposes indirect coercive pressures by infl
uencing cultural norms in the environment of organizations that are not dir
ectly affected by the regulations. The overall direction and strength of th
ese effects vary with the centrality of organizations in terms of their loc
ation, the time elapsed since an environmental change, and organizational a
ge. We discuss the implications of our findings for organization theory, pa
rticularly the relationship between social movements and institutional acti
on, the effects of institutional action on industry structure, and the link
age between environmental change, organizational age, and organizational mo
rtality.(. )