O bow they cling and wrangle,some wbo claim their attempts to understand the origins,op- For preacber and monk the bonored name! erations,and dynamics of markets as social For,quarreling,eacb to bis view they cling. structures,the primary perspectives that have Such folk see only one side of a thing. emerged tend to remain separate and distinct at the theoretical level.Much like the blind (from the text of Jain and Buddhist origin, Udana 68-69,"Parable of the Blind Men and monks and preachers who fail to see the whole the Elephant") of the elephant in Buddha's famous parable, scholars have often focused on a particular so- cial aspect of markets and acted as if it was a INTRODUCTION more general understanding. The sociology of markets has been one of the This theoretical separateness produces most vibrant fields in sociology in the past two problems.First,because many scholars 25 years.!Starting with a trickle of empiri- use similar concepts but identify them by cal and theoretical papers,it has grown to a different terms,confusion results about the river.One of the seminal pieces in the field, degree to which people are saying different Granovetter's(1985)"Economic Action and things.For example,most scholars,regardless Social Structure:The Problem of Embedded- of their approach,believe that culture(shared ness"has been cited over 2500 times since its meanings,normative understandings,identi- publication,making it the most cited paper in ties,local practices)plays an important role sociology in the postwar era.2 Although so- in market projects.Much of this conceptual ciologists have made significant progress in overlap is hidden by the use of jargon (for ex- ample,the use ofterms like frames,logics,per- We want to distinguish the sociology of markets from formativity,scripts,conceptions of control,or the broader project of economic sociology(Fligstein 2001). local knowledge).Thus,scholars who purport Following Polanyi(1957),economic sociology is the gen- eral study of the conditions of the production and repro- to approach their subject matter from a partic- duction of social life.Such a study would include studies ular perspective actually share concepts with of consumption,the family,and the links between states a wide variety of other scholars. and houscholds,schooling,and economic life more broadly (Smelser Swedberg 2005,p.3).The sociology of markets Second,to the degree that scholars are refers more narrowly to the study of one kind of social ex- really saying different things,assessing how change,that of markets,and to the structuring of that kind much their theoretical views are complemen- of social exchange,under the conditions we call capitalist This focus includes the study of firms,product markets,and tary or contradictory is difficult.When one labor markets as well as their broader linkages to suppliers, viewpoint complements another,theory is ad- workers,and states and the role of local cultures (i.e.,local vanced.Taking into account other possible el- in the sense of belonging to a particular market),systems of meanings insofar as they influence what products are,and ements in the social structuring of markets the role of morality in the generation of particular kinds of yields a more complete view of market pro- markets. cesses.But when theories contradict,scholars 2Recently Jerry Jacobs (2005)calculated the most cited need to understand why their perspectives dif- papers in the American Sociological Revie in the postwar era.The paper with the most citations was DiMaggio fer and how those differences can be usefully Powell's(1983)"Institutional Isomorphism"paper,with explored to further both theory and research. 1700 citations.Granovetter's paper appeared in the Amer- The primary purpose of this review is to be- ican fournal of Sociology and,as far as we know,no one has created a similar list for that journal.But,with almost gin to untangle the theoretical and empirical 2500 citations,it is hard to believe that many papers outdid work on the sociology of markets,clarifying Granovetter's.It should also be noted that the DiMaggio what we know and where scholars really dis- Powell paper has greatly influenced the sociology of mar- kets as well.We argue that this paper has greatly influenced agree. at least one strain of thought in the sociology of markets The literature (and the way that peo- (i.e.,institutional theory).If one takes both of these pa- ple teach their graduate courses)has of- pers as part of the foundation of the field,arguably the two most cited papers in the postwar era are at the core of the ten been divided into three theory groups sociology of markets. (Fourcade-Gourinchas 2007)according to I06 Fligstein·DauterANRV316-SO33-06 ARI 24 May 2007 10:6 O how they cling and wrangle, some who claim For preacher and monk the honored name! For, quarreling, each to his view they cling. Such folk see only one side of a thing. (from the text of Jain and Buddhist origin, Udana 68–69, “Parable of the Blind Men and the Elephant”) INTRODUCTION The sociology of markets has been one of the most vibrant fields in sociology in the past 25 years.1 Starting with a trickle of empiri￾cal and theoretical papers, it has grown to a river. One of the seminal pieces in the field, Granovetter’s (1985) “Economic Action and Social Structure: The Problem of Embedded￾ness” has been cited over 2500 times since its publication, making it the most cited paper in sociology in the postwar era.2 Although so￾ciologists have made significant progress in 1We want to distinguish the sociology of markets from the broader project of economic sociology (Fligstein 2001). Following Polanyi (1957), economic sociology is the gen￾eral study of the conditions of the production and repro￾duction of social life. Such a study would include studies of consumption, the family, and the links between states and households, schooling, and economic life more broadly (Smelser & Swedberg 2005, p. 3). The sociology of markets refers more narrowly to the study of one kind of social ex￾change, that of markets, and to the structuring of that kind of social exchange, under the conditions we call capitalist. This focus includes the study of firms, product markets, and labor markets as well as their broader linkages to suppliers, workers, and states and the role of local cultures (i.e., local in the sense of belonging to a particular market), systems of meanings insofar as they influence what products are, and the role of morality in the generation of particular kinds of markets. 2Recently Jerry Jacobs (2005) calculated the most cited papers in the American Sociological Review in the postwar era. The paper with the most citations was DiMaggio & Powell’s (1983) “Institutional Isomorphism” paper, with 1700 citations. Granovetter’s paper appeared in the Amer￾ican Journal of Sociology and, as far as we know, no one has created a similar list for that journal. But, with almost 2500 citations, it is hard to believe that many papers outdid Granovetter’s. It should also be noted that the DiMaggio & Powell paper has greatly influenced the sociology of mar￾kets as well. We argue that this paper has greatly influenced at least one strain of thought in the sociology of markets (i.e., institutional theory). If one takes both of these pa￾pers as part of the foundation of the field, arguably the two most cited papers in the postwar era are at the core of the sociology of markets. their attempts to understand the origins, op￾erations, and dynamics of markets as social structures, the primary perspectives that have emerged tend to remain separate and distinct at the theoretical level. Much like the blind monks and preachers who fail to see the whole of the elephant in Buddha’s famous parable, scholars have often focused on a particular so￾cial aspect of markets and acted as if it was a more general understanding. This theoretical separateness produces two problems. First, because many scholars use similar concepts but identify them by different terms, confusion results about the degree to which people are saying different things. For example, most scholars, regardless of their approach, believe that culture (shared meanings, normative understandings, identi￾ties, local practices) plays an important role in market projects. Much of this conceptual overlap is hidden by the use of jargon (for ex￾ample, the use of terms like frames, logics, per￾formativity, scripts, conceptions of control, or local knowledge). Thus, scholars who purport to approach their subject matter from a partic￾ular perspective actually share concepts with a wide variety of other scholars. Second, to the degree that scholars are really saying different things, assessing how much their theoretical views are complemen￾tary or contradictory is difficult. When one viewpoint complements another, theory is ad￾vanced. Taking into account other possible el￾ements in the social structuring of markets yields a more complete view of market pro￾cesses. But when theories contradict, scholars need to understand why their perspectives dif￾fer and how those differences can be usefully explored to further both theory and research. The primary purpose of this review is to be￾gin to untangle the theoretical and empirical work on the sociology of markets, clarifying what we know and where scholars really dis￾agree. The literature (and the way that peo￾ple teach their graduate courses) has of￾ten been divided into three theory groups (Fourcade-Gourinchas 2007) according to 106 Fligstein · Dauter Annu. Rev. Sociol. 2007.33:105-128. Downloaded from www.annualreviews.org Access provided by Shanghai Jiaotong University on 02/04/15. For personal use only