Abstract
Economics and social sciences in general have a long tradition of using theories, models, concepts, and so forth borrowed from the natural sciences to describe and explain the properties and behaviours of economic and social entities. However, unwarranted application of theoretical elements from the natural sciences in the economic/social domain can have adverse consequences for organisations, their employees and society in general. Focusing on biology and organisation studies, we discuss the general problems that may arise when theoretical elements from natural science are applied in the economic/social domain. We examine one particular case, the organisational ecology research programme, and we argue that organisational ecology rests on the metaphorical, rather than literal, use of the notion of evolution. We conclude by showing how the use of the evolutionary metaphor in organisation theory can have adverse consequences for both managerial practice and society in general.
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Of course, there are also many examples in which theories from other domains of natural science are imported into economics and social studies. Including these in our discussion would however require another paper.
The question what makes a particular entity a biological or a non-biological entity is not unequivocally answerable. For example, the position that all and only entities that are alive are biological entities is vulnerable to the objection that the notions of ‘life’ and ‘being alive’ are not clearly defined. Furthermore, it seems open to the move that one could extend the scope of the notion of ‘being alive’ so far that the entities that one wishes to conceive of as biological entities fall under the extended notion. Hence, we conceive of the distinction between biological and non-biological entities as the distinction between on the one hand what normally is studied by biologists and to which the theories of biological science were originally devised to apply and on the other hand what is not normally studied within the domain of biological science. In this sense, organisations clearly are nonbiological entities. We provide this clarification in response to a comment by an anonymous referee and will return to this matter in Section 2.
For recent overviews, see A J Robson ‘The biological basis of economic behavior’, Journal of Economic Literature 39 (2001) pp 11–33, or P Hammerstein & E H Hagen ‘The second wave of evolutionary economics in biology’, Trends in Ecology and Evolution 20 (2005) pp 604–609.
S Ghoshal ‘How management theories are destroying good management practices’ Academy of Management Learning & Education 4 (2005) pp 75–91; F Ferraro, J Pfeffer & R I Sutton ‘Economics language and assumptions: how theories can become self-fulfilling’, Academy of Management Review 30 (2005) pp 8–24
We have examined the case of organisational ecology in detail elsewhere; see T A C Reydon & M Scholz ‘Why organisational ecology is not a Darwinian research program’ Philosophy of the Social Sciences (in press).
A van Witteloostuijn ‘Organisational ecology has a bright future’ Organisation Studies 21 (2000) pp v-xiv; quotation from p v
An anonymous referee suggested that many epistemologists are inclined to understand all models as metaphors, so that there would be nothing wrong in principle with using evolutionary models in the economic/social domain. While this may be the case, it should be noted that this is far from a generally accepted view among philosophers of science. Current philosophy of science (especially in the philosophy of economics / social science and the philosophy of biology) is witnessing an increasing attention for the use of models in science — and many of the participants in these debates do not conceive of models as mere metaphors. For an overview of the current state of the philosophical discussion on models in science, see R Frigg & S Hartmann, ‘Models in science’ in E Zalta (Ed.) Stanford Encyclopedia of Philosophy (spring 2008 edition, online) 2008.
See, for example: J Gimeno, T B Folta, A C Cooper & C Y Woo ‘Survival of the fittest? Entrepreneurial human capital and the persistence of underperforming firms’ Administrative Science Quarterly 42 (1997) pp 750–783; J N Baron, M D Burton & M T Hannan ‘Engineering bureaucracy: the genesis of formal policies, positions, and structures in high-technology firms’ Journal of Law, Economics and Organisations 15 (1998) pp 1–41; H E Aldrich Organisations Evolving Sage, London 1999; A Spicer, G McDermott & B Kogut ‘Entrepreneurship and privatisation in central Europe: the tenuous balance between creation and destruction’ Academy of Management Journal 25 (2000) pp 630–649; S D Dobrev & W P Barnett ‘Organisational roles and transition to entrepreneurship’ Academy of Management Journal 48 (2005) pp 433–449
Eg, H Steinmann & A G Scherer ‘Grundlagenstreit und Theorie-Praxis-Verhältnis in der Betriebswirtschaftslehre’ in: K P Wiedemann, W Fritz & B Abel (Eds) Management mit Vision und Verantwortung pp 263–283 Gabler, Wiesbaden 2004; Ghoshal 2005 op cit
Ghoshal 2005 op cit p 77
Robson 2001 op cit p 11
Good overviews of current evolutionary economics can be found in: R R Nelson & S G Winter An Evolutionary Theory of Economic Change Harvard University Press, Cambridge (Mass.) 1982; G M Hodgson ‘Thorstein Veblen and post-Darwinian economics’ Cambridge Journal of Economics 16 (1992) pp 285–301; R R Nelson ‘Recent evolutionary theorising about economic change’ Journal of Economic Literature 33 (1995) pp 48- 90; G M Hodgson ‘On the evolution of Thorstein Veblen’s evolutionary economics’ Cambridge Journal of Economics 22 (1998) pp 415–431; G M Hodgson ‘Darwinism in economics: from analogy to ontology’ Journal of Evolutionary Economics 12 (2002) pp 259–281; R R Nelson & S G Winter ‘Evolutionary theorising in economics’, Journal of Economic Perspectives 16 (2002) pp 23–46; G M Hodgson & T Knudsen ‘The firm as an interactor: firms as vehicles for habits and routines’ Journal of Evolutionary Economics 14 (2004) pp 281–307. For a recent review of how evolutionary economics is currently being re-imported into biology, see Hammerstein & Hagen 2005 op cit.
Hodgson 1992 op cit, Hodgson 1998 op cit
Let us provide the following additional clarification. Mass is a physical property, notwithstanding that the masses that actual organisms possess have evolutionary and developmental backgrounds. Also, the mass of an organism can play a role in biological processes and the theories that describe them. Still, mass is a physical and not a biological property, because mass is defined in the context of a physical theory. Mass is embedded in physical theory, but can still feature in biological theories.
A good overview of the conceptual history of evolutionary theory is P Bowler Evolution: The History of an Idea (third edition) University of California Press, Berkeley 2003
M T Hannan & J Freeman ‘The population ecology of organisations’ American Journal of Sociology 82 (1977) pp 929–964; M T Hannan & J Freeman Organisational Ecology Harvard University Press, Cambridge (Mass.) 1989; M T Hannan ‘Ecologies of organisations: diversity and identity’ Journal of Economic Perspectives 19 (2005) pp 51–70
B McKelvey ‘Organisational systematics: taxonomic lessons from biology’ Management Science 24 (1978) pp 1428–1440; H E Aldrich Organisations and Environments Prentice-Hall, Englewood Cliffs 1979; B McKelvey Organisational Systematics: Taxonomy, Evolution, Classification University of California Press, Berkeley 1982; B McKelvey & H E Aldrich ‘Populations, natural selection, and applied organisational science’ Administrative Science Quarterly 28 (1983) 101–128; Aldrich 1999 op cit
Reydon & Scholz op cit
Hannan & Freeman, for instance, asserted to be aiming ‘to move toward an application of modern population ecology theory to the study of organisation-environment relations’ (Hannan & Freeman 1977 op cit p 956, our emphasis) and described their approach as ‘an approach (…) that builds on general ecological and evolutionary models of change. (…) We have adapted ecological models to sociological uses and changed them in the process’ (J Freeman & M T Hannan ‘Setting the record straight on organisational ecology: rebuttal to Young’ American Journal of Sociology 95 (1989) pp 425–439, see pp 426–428, emphasis added; also Hannan & Freeman 1989 op cit p xiii). McKelvey asserted that evolutionary theory is one of the ‘four main subcomponents of the population view. (…) The principal need for evolutionary theory is to explain how there come to be so many kinds of organisations. (…) [T]his is a question calling for systematic and evolutionist analysis’ (McKelvey 1982 op cit pp 437–438; our emphasis).’
Hannan & Freeman 1977 op cit pp 936 & 956; McKelvey 1978 op cit p 1437; Hannan 2005 op cit p 51
Phylogenetic inertia has been discussed by one of us elsewhere: T A C Reydon ‘Generalisation and kinds in natural science: The case of species’ Studies in History and Philosophy of Biological and Biomedical Sciences 37 (2006) pp 230–255
For a detailed argumentation of this claim, see Reydon & Scholz op cit
And, it should be emphasised, ‘In Darwin’s theory, only populations evolve’ (Bowler op cit p 11; emphasis added). An anonymous referee suggested that because organisational information such as routines, core competences, etc. can be conceived of as the ‘genes’ of organisations that are being replicated, it would be legitimate to think of organisational change as an evolutionary process. But this is not the case. Replication is merely one of the sub-processes of biological evolution and replication alone does not constitute evolution. Our point is that ‘populations’ of organisations cannot evolve in the same sense as biological populations do, irrespective of whether units of replication can be identified in the organisational domain.
Reydon & Scholz op cit
Hannan 2005 op cit p 52 (emphasis added)
McKelvey 1982 op cit p xviii
McKelvey 1978 op cit p 1438 (emphasis added)
Generally speaking, analogies pick out important structural similarities that obtain between two entities or phenomena and obscure less important differences, whereas metaphors constitute a more loose way of drawing resemblances between two entities or phenomena. For an account of the difference, see D Gentner & M Jeziorski ‘The shift from metaphor to analogy in Western science’ in: A Ortony (Ed) Metaphor and Thought (2nd edition) pp 447–480 Cambridge University Press, Cambridge 1993
For the cognitive usefulness of metaphors, see G Lakoff & M Johnson Metaphors We Live By University of Chicago Press, Chicago & London 1980; D C Rosenthal ‘Metaphors, models and analogies in social science and public policy’ Political Behavior 4 (1982) pp 283–301; Gentner & Jeziorski 1993 op cit
G Morgan ‘Paradigms, metaphors, and puzzle solving in organisation theory’ Administrative Science Quarterly25 (1980) pp 605–622; G Morgan ‘More on metaphor: why we cannot control tropes in administrative science’ Administrative Science Quarterly 28 (1983) pp 601–607; G Morgan Images of organisations Sage, Beverly Hills 1986; see also C C Pinder & W V Bourgeois ‘Controlling tropes in administrative science’ Administrative Science Quarterly 27 (1982) pp 641–652; W V Bourgeois & C C Pinder ‘Contrasting philosophical perspectives in administrative science: a reply to Morgan’ Administrative Science Quarterly 28 (1983) pp 608–613
Pinder & Bourgeois 1982 op cit pp 647–648
Morgan 1983 op cit; emphasis added
Morgan 1986 op cit
This lens-metaphor is due to R L Flood & M C Jackson Creative Problem Solving: Total Systems Intervention Wiley, Chichester 1991
Morgan 1986 op cit pp 19–36
Pinder & Bourgeois 1982 op cit p 647
Morgan 1986 op cit p 74. As an anonymous referee pointed out, the effect might be the de-motivation of managers (who might feel that their actions will not have much effect) rather than the actual undermining of their powers to act and structure their organisations. Indeed, the fact that environments constrain the possibilities of managers’ actions does not necessarily imply that managers are powerless. (Consider Marx’s often quoted observation that people make their own history, albeit not in circumstances of their own choosing.) However, the risk remains present that overemphasising the importance of selection in the organisational domain leads managers to act as if they indeed were powerless and therewith unwittingly to concede whatever power they did possess.
As an anonymous referee pointed out, this is precisely the opposite from the effect that may occur when managers’ rewards are coupled to the performance of their companies: managers might then be punished for malfunctionings of their organisations that are caused by factors that are out of their control.
Morgan 1986 op cit p 76
D Von der Oelsnitz ‘Orangenbäumchen am Plattensee’ Die Betriebswirtschaft 654 (2005) pp 333–348
As an anonymous referee pointed out, the legitimisation of selfish and ethically problematic corporate actions as being ‘natural’ does not depend on the adoption of a biological perspective. In fact, as the referee pointed out, from a Marxist perspective ethical considerations might even be seen as distorting the ‘natural’ mechanisms by which the market operates. This is indeed true, but it is also important to see that irrespectively of which view of how the market operates is taken, the organisational ecological perspective by itself can already (wrongly!) suggest that particular behaviors are ‘natural’ and therefore legitimate.
Von der Oelsnitz 2005 op cit p 341
Eg, R C Young ‘Is population ecology a useful paradigm for the study of organisations?’ American Journal of Sociology 94 (1988) pp 1–24; L Donaldson American Anti-Management Theories of Organisation: A Critique of Paradigm Proliferation Cambridge University Press, Cambridge 1995; A Kieser & M Woywode ‘Evolutionstheoretische Ansätze’ in: A Kieser & M Ebers (Eds) Organisationstheorien (6. Auflage) pp 309–352 Kohlhammer, Stuttgart 2006
McKelvey 1982 op cit p 448
Cf. Hannan & Freeman 1989 op cit p 150; Aldrich 1979 op cit p 256
Donaldson 1995 op cit
McKelvey 1982 op cit pp 446–449
Cf. the suggestive passages in McKelvey 1982 op cit pp 448–449
We thank Mehmet Elgin, Paul Hoyningen—Huene and an anonymous referee for helpful comments on an earlier draft of this paper. The ideas presented in this paper were also presented at the workshop Betriebswirtschaftslehre und Unternehmensethik, organised by the committee on philosophy of science of the Association of University Professors of Management (Ludwig Maximilians University, Munich, March 2007; see: M Scholz & T A C Reydon ‘Wie praktische Probleme aus ungerechtfertigter Theorieübertragung hervorgehen können: Eine Fallstudie des populationsökologischen Ansatzes in der Organisationstheorie’ in: A G Scherer & M Patzer (Eds) Betriebswirtschaftslehre und Unternehmensethik pp 125–143 Gabler, Wiesbaden 2008) and at the fourth Philosophy of Management conference (St. Anne’s College, Oxford, July 2007).
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Scholz, M., Reydon, T.A.C. The Population Ecology Programme in Organisation Studies: Problems Caused by Unwarranted Theory Transfer. Philos. of Manag. 6, 39–51 (2008). https://doi.org/10.5840/pom20086319
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DOI: https://doi.org/10.5840/pom20086319