There has been increasing interest and debate in recent years on the instituted nature of economic processes in general and the related ideas of the market and the competitive process in particular. This debate lies at the interface between two largely independent disciplines, economics and sociology, and reflects an attempt to bring the two fields of discourse more closely together. This book explores this interface in a number of ways, looking at the competitive process and market relations from a number of different perspectives. It considers the social role of economic institutions in society and examines the various meanings embedded in the word 'markets', as well as developing arguments on the nature of competition as an instituted economic process. The close of the twentieth century saw a virtual canonisation of markets as the best, indeed the only really effective, way to govern an economic system. The market organisation being canonised was simple and pure, along the lines of the standard textbook model in economics. The book discusses the concepts of polysemy , idealism, cognition, materiality and cultural economy. Michael Best provides an account of regional economic adaptation to changed market circumstances. This is the story of the dynamics of capitalism focused on the resurgence of the Route 128 region around Boston following its decline in the mid-1980s in the face of competition from Silicon Valley. The book also addresses the question of how this resurgence was achieved.
seriously within the study of economic organisation – not simply in terms of
seeing culture as a kind of ‘padding’ for economic activity, but as a sector of
production, distribution and consumption involving distinctive organisational
forms, marketrelations and competitive logics. Secondly, within the cultural
field market actors, market segments and market commodities are constituted
in innovative and often unstable ways. Thirdly, contemporary cultural industries are subject to a highly variable mix of markets, firms and networks as
means of shaping economic processes
role of information and knowledge in the dynamics of the market process;
social consequences of marketrelations; and, finally, the relationship between
markets and competition.
Markets as institutions
The idea of markets as institutions, as habits, rules of social behaviour, is of
course not new. Yet, implications of this point await their full development in
terms of distinguishing between the market framework in general and markets in particular, and in distinguishing between the rules of the game at a
point in time and the generative processes through which those
coming to mirror theory
through the policy and practice of the powerful. We would not go so far as
to say that the discourse of the virtuous market has created the institutional
forms that it (mis)describes. Nevertheless, there are many potential ways in
which the attribution of positive functions to marketrelations would affect
understandings of reality and thus economic, political and social action.
What we find most striking is the extent to which the market is considered
to be without stain in the current period. Unparalleled, if not entirely
from a world of relatively stable
material cultures and marketrelations (in which, despite innovation, manufacturers could think in terms of relatively self-evident object categories) to
a world of increasingly unstable material cultures and marketrelations.
One symptomatic management and marketing term that responded to this
situation is the ‘product concept’ or ‘product definition’, along with cognate
terms such as differentiation, segmentation, positioning and market ‘gaps’
that related destabilised, problematic goods to equally unstable competitive
material aspects of economic life and in presenting an overly benign view which underestimates the
instrumentality of most economic relations. Finally, I conclude with a reminder
of the political significance of explanations of markets and competition.
The multiple meanings of ‘market’1
If we are to discuss marketrelations and competition, we need to be clear on
what the former involve. However, such is the variety of uses of the term
‘market’ that it is important to distinguish them if we are not to talk at
crossed purposes. As Maureen Mackintosh observes, these are
concept of ‘instituted economic process’ with the other and more widely
adopted Polanyan legacy of ‘embeddedness’, the chapter explores competition as an instituted economic process in five dimensions: the co-institution
of competitive processes and markets; relations of power and mutual
dependence between classes of economic agent; the formation of units of
competition; the formation of scales of competition; and the development
of formal and informal norms of competition. The chapter then provides
an exemplification of this analytical framework through a schematic
The market organisation being canonised was simple and pure, along the lines of the standard textbook model in economics. This chapter considers the various virtues that purportedly characterise market organisation and elevates it over other kinds of governance structures. It concerns with 'market failure' theory, and other broad theories that point towards the desirability of a mixed economy. The chapter proposes that almost all activities in modern economies are governed through a mix of market and non-market mechanisms, with the relative importance of markets. The presumption and the fact that markets play a pervasive role in the governance and organisation of economic activity are relatively recent phenomena. To assess market organisation as a governing system, it is essential to widen the analytic context. The chapter focuses on strand of political philosophy, particularly Anglo-American political philosophy.
This chapter provides some emphasis to the influence of markets on the growth and use of individual knowledge and explains how knowledge within firms may benefit from market relationships. It identifies some basic elements of human cognition to provide a credible psychological basis for economic reasoning. The chapter also explains the effectiveness of marketing institutions which match cognitive needs. Market institutions are an important part of consumers' external organisation: the rules and conventions form part of their interpretative system and their framework for decision making. New products may require the creation of new market institutions, and the possibility of creating new market institutions may suggest product redesign. Business customers may have stronger incentives than do their suppliers to simplify the process of transacting, and this may not merely be a matter for the purchasing department, for production is closely linked with purchasing as well as marketing.
This chapter studies the evolution of the software industry in the UK. It describes the role of demand factors in the process of vertical disintegration and distinguishes between the product and service segments of the software market. The chapter reviews the changing need for software in the growth of the global software industry. It highlights the role of a narrow demand base in the emergence of a market for traded software in the UK. The chapter examines the supply side of the software market. It also examines the impact of the demand- and supply-side factors on the nature of competition, competitive advantage and barriers to growth for firms in the UK software sector. The absence of a large commodity software market has meant a less radical impact of the software industry upon industrial growth in the UK economy.