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Organizational Infrastructures for Economic Resilience: Alternatives to Shareholder Value-oriented Corporations and Unemployment Trajectories in the US During the Great Recession

Organizational Imaginaries: Tempering Capitalism and Tending to Communities through Cooperatives and Collectivist Democracy

ISBN: 978-1-83867-990-3, eISBN: 978-1-83867-989-7

Publication date: 24 March 2021

Abstract

Despite recent advances, neither organizational studies nor the scholarship on economic resilience has systematically addressed how the ecologies of organizations that populate local economies can serve as infrastructures for responding proactively to economic shocks. Using county-level data, this study analyzes relationships between the prevalence of organizational alternatives to shareholder value-oriented (SVO) corporations within a particular locality and its unemployment levels during and after the Great Recession. The results support the hypothesis that the presence of such alternative organizations can enhance the capacities of local economies to resist and recover from recession shocks. Cooperative, municipal, and community-based enterprises, research universities, and nonprofits more generally were associated with greater resistance to the recession shock and stronger recoveries – specifically, lower surges in unemployment rates from 2007 to 2010 and greater reductions in unemployment rates from 2010 to 2016. By contrast, SVO corporations were associated with greater surges in unemployment and perhaps weaker recoveries. Providing a proof of concept, this study opens up new lines of inquiry for organizational studies by linking organizational ecologies to the promotion of collective efficacy and a more broadly shared prosperity in economic life.

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Acknowledgements

Acknowledgments

The research reported here was supported by National Science Foundation grant #1528190 and the Stillman Drake and Corbett/Goldhammer funds at Reed College. The author thanks Michael Lounsbury for some foundational conversations; Jason Owen-Smith, Woody Powell, Jerry Davis, Frank Dobbin, and the three anonymous reviewers for their helpful feedback; Annie Peng, Eleanor Parmentier, Darci Kovacs, and Chiara Packard for their research assistance on this project; and the editors, Victor Chen and Katherine Chen, for their careful attention, support, and patience. The usual caveats apply.

Citation

Schneiberg, M. (2021), "Organizational Infrastructures for Economic Resilience: Alternatives to Shareholder Value-oriented Corporations and Unemployment Trajectories in the US During the Great Recession", Chen, K.K. and Chen, V.T. (Ed.) Organizational Imaginaries: Tempering Capitalism and Tending to Communities through Cooperatives and Collectivist Democracy (Research in the Sociology of Organizations, Vol. 72), Emerald Publishing Limited, Leeds, pp. 187-228. https://doi.org/10.1108/S0733-558X20210000072008

Publisher

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Emerald Publishing Limited