Conventions and Categories in Markets

by

Kangsan Lee

• LAST REVIEWED: 26 May 2023
• LAST MODIFIED: 26 May 2023
• DOI: 10.1093/obo/9780199756384-0265

Introduction

Sociological interest in the topic of market conventions and categories has a long history, extending back to the works of Weber. With the rise of organization theory and new economic sociology in the 1970s and 1980s, scholars expanded the concept of conventions and categories in markets into important research topics, particularly in the context of market change and boundary expansion. Scholars in these fields have suggested that conventions and categories function both as a cognitive frame and as a formal structure, although the research foci have developed differently over time.

General Overview

The popularity of research into categories and conventions has grown in recent decades, and its importance is demonstrated in particular with regard to the study of markets. Although scholars have generally not integrated these two different concepts, they display many similarities and comparable/interchangeable aspects. Biggart and Beamish 2003 and Negro, et al. 2010 describe that conventions and categories in markets are similar insofar as they are both the product of socially knowledgeable actors working within collective understandings of what is possible, probable, and likely to result in market behaviors. On the other hand, conventions (or norms) and categories (and categorization) differ in other ways. Although DiMaggio and Powell 1991 emphasizes the social and cognitive processes driving organizational homogeneity in the field of conventions, Durand, et al. 2017, research into categories and categorization, focuses on the boundaries and different meaning systems. These review papers largely focus on extended facets of conventions and categories in markets and summarize contributions to economic sociology and market studies in relation to these dimensions; they also briefly discuss avenues for future research. For more on categories and categorization in other areas of sociology, such as symbolic boundaries and culture and classification, see Pachucki, et al. 2007 and Baumann, et al. 2009, respectively.

• Baumann, Shyon, Timothy Dowd, and Susanne Janssen. 2009. Introduction: Classifying culture—agents, structures, processes. Poetics 37:295–297.

  DOI: 10.1016/j.poetic.2009.06.007

  The introduction to a special issue on cultural classification, which demonstrates the diversity of research that emerged in response to Paul DiMaggio’s call to examine the relationship between social structure and the emergence, variability, and persistence of classificatory schemes.

• Biggart, Nicole Woolsey, and Thomas D. Beamish. 2003. The economic sociology of conventions: Habit, custom, practice, and routine in market order. Annual Review of Sociology 29:443–464.

  DOI: 10.1146/annurev.soc.29.010202.100051

  This review paper describes theories of market order, shows how convention theory and related approaches represent a novel alternative, and suggests how convention theory can supplement network theory and institutional approaches to understanding market order.

• DiMaggio, Paul, and Walter W. Powell, eds. 1991. The new institutionalism in organizational analysis. Chicago: Univ. of Chicago Press.

  DiMaggio and Powell offer a collection with case studies ranging across a variety of organizational forms. They note the conditions under which organizations resemble one another, identifying three forms of isomorphism (mimetic, coercive, and normative). This volume is considered a core contribution on institutional analysis.

• Durand, Rodolphe, Nina Granqvist, and Anna Tyllström. 2017. From categories to categorization: A social perspective on market categorization. In From categories to categorization: Studies in sociology, organizations and strategy at the crossroads. Research in the Sociology of Organizations 51. Edited by Rodolphe Durand, Nina Granqvist, and Anna Tyllström, 3–30. Bingley, UK: Emerald.

  DOI: 10.1108/S0733-558X20170000051011

  This introductory article takes stock of the research into two facets of categorization, addressing it both as a cognitive and a social process. It advocates for a rebalance toward the social process of categorization, paying more heed to the entity to be categorized, the actors involved, their acts, and the context and timing that informs these activities. It summarizes the contributions to the volume in relation to these dimensions and briefly discusses avenues for future research.

• Negro, Giacomo, Özgecan Koçak, and Greta Hsu. 2010. Research on categories in the sociology of organizations. In Categories in markets: Origins and evolution. Research in the Sociology of Organizations 31. Edited by Greta Hsu, Giacomo Negro, and Özgecan Koçak, 3–35. Bingley: Emerald.

  DOI: 10.1108/S0733-558X(2010)0000031003

  This introductory chapter reviews published work in various streams of research and finds that studies of organizational forms and identities, institutional logics, collective action frames, and product conceptual systems have key commonalities and predictable differences.

• Pachucki, Mark A., Sabrina Pendergrass, and Michèle Lamont. 2007. Boundary processes: Recent theoretical developments and new contributions. Poetics 35:331–351.

  DOI: 10.1016/j.poetic.2007.10.001

  This review article provides a comprehensive discussion of the boundary literature, with particular attention given to ethno-racial boundaries and aesthetic boundaries.