Since the mid-20th century, organizational theorists have increasingly distanced themselves from the study of core societal power centers and important policy issues of the day. This has been driven by a shift away from the study of organizations, politics, and society and towards a more narrow focus on instrumental exchange and performance. As a result, our field has become increasingly impotent as a critical voice and contributor to policy. For a contemporary example, witness our inability as a field to make sense of the recent U.S. mortgage meltdown and concomitant global financial crisis. It is not that economic and organizational sociologists have nothing to say. The problem is that while we have a great deal of knowledge about finance, the economy, entrepreneurship and corporations, we fail to address how the knowledge in our field can be used to contribute to important policy issues of the day. This double-volume brings together some of the very top scholars in the world in economic and organizational sociology to address the recent global financial crisis debates and struggles around how to organize economies and societies around the world.
"Bravo! Finally, a stellar group of economic sociologists speak out about the antecedents, processes, and consequences of the 2008 financial crisis. Markets on Trial ably combines sharp analytic insights with much needed policy recommendations. Viviana Zelizer, Lloyd Cotsen '50 Professor of Sociology, Princeton University, author of Economic Lives: How Culture Shapes the Economy". "Now that it's clear to just about everyone that there are institutions and organizations behind markets and that both have a major hand in market failures, who are you going to call? Organizational and economic sociologists of course! This book assembles scholars of significant repute from both fields with much to say about why we are where we are today. The messages are provocative and important. It's time to listen to the voices in this timely and important book. At the moment, this book should be on every thinking person's ""to read"" list. Stephen R. Barley, Richard Weiland Professor and Co-Director, Center for Work, Technology and Organization, Stanford University". Markets on Trial is an essential foundation for understanding the Great Recession of 2008-09, and for averting future financial catastrophes. Drawing on research by the era's premier economic sociologists, this volume makes a compelling case for seeing the subprime mortgage disaster, Lehman failure, and financial meltdown as predictable - and thus avoidable - products of free-market ideology, shareholder-value capitalism, misapplied agency-theory, corporate-elite fragmentation, and, ultimately, a massive failure of leadership. Michael Useem, Professor of Management and Director of the Center for Leadership and Change, Wharton School, University of Pennsylvania
PART B SECTION III: HISTORICAL ORIGINS OF THE U.S. FINANCIAL CRISIS Chapter 11: The Misapplication of Mr. Michael Jensen: How Agency Theory Brought Down the Economy and Why it Might Again, Frank Dobbin and Jiwook Jung (Harvard University) Chapter 12: Neoliberalism in Crisis: Regulatory Roots of the U.S. Financial Meltdown, John Campbell (Dartmouth College) Chapter 13: The American Corporate Elite and the Historical Roots of the Financial Crisis of 2008, Mark Mizruchi (University of Michigan) Chapter 14: The Political Economy of Financial Exuberance, Greta Krippner(University of Michigan) SECTION IV: CRISIS PRODUCTION: SPECULATIVE BUBBLES AND BUSINESS CYCLES Chapter 15: The Institutional Embeddedness of Market Failure: Why Speculative Bubbles Still Occur, Mitch Abolafia (State University of New York at Albany) Chapter 16: The Social Construction of Causality: The Effects of Institutional Myths on Financial Regulation, Anna Rubtsova (Emory University), Rich DeJordy (Boston College), Mary Ann Glynn (Boston College) and Mayer Zald (University of Michigan) Chapter 17: Business Cycles, Entrepreneurship, and Economic Crisis in the Commercial Building Market: Toward a Mesoeconomics, Tom Beamish and Nicole Biggart (University of California at Davis) SECTION V: COMPARATIVE INSTITUTIONAL DYNAMICS Chapter 18: Through the Looking Glass: Inefficient Deregulation in the United States and Efficient State-Ownership in China, Doug Guthrie and David Slocum (New York University) Chapter 19: Precedence for the Unprecedented: A Comparative Institutionalist View of the Financial Crisis, Gerald McDermott (University of South Carolina) SECTION VI: A FUTURE SOCIETY AND ECONOMY Chapter 20: After the Ownership Society: Another World is Possible, Jerry Davis (University of Michigan) SECTION VII: POSTSCRIPTS Chapter 21: What If We Had Been in Charge? The Sociologist as Builder of Rational Institutions Ezra Zuckerman (MIT) Chapter 22: The Future of Economics, New Circuits for Capital, and Re-envisioning the Relation of State and Market, Fred Block (University of California at Davis)