Faculty of Management Research Workshop; Jost Sieweke, Vrije Universiteit Amsterdam
Jost Sieweke, Vrije Universiteit Amsterdam
We advance research on legitimacy and institutional change by theorizing a multilevel model of how an individual legitimacy judgment—propriety—is affected by an exogenous crisis event and how two collective constructs—validity and consensus—influence this effect. Disentangling these perceptual components of the legitimacy process and clarifying how they operate across different levels offers important insights on how propriety judgments change in the aftermath of a crisis. Specifically, we theorize that changes in evaluators’ propriety judgments are strongest in contexts characterized by high validity and low consensus, because, in such contexts, a crisis may reveal that validity is contested. Using a regression discontinuity design, we examine the effect of the 2008 Financial Crisis on individuals’ propriety judgments about free markets in 15 different countries. Our results provide empirical support for our theory. Implications for research on legitmacy and institutional change, as well as extant methodological approaches in legitimacy research, are discussed.
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Cass Business School, 106 Bunhill Row
106 Bunhill Row, London EC1Y 8TZ, UK
Jost Sieweke is associate professor of management and organization at Vrije Universiteit Amsterdam. In his research, he focuses on human errors (e.g., error reporting, learning from errors, coordination errors) and legitimacy (e.g., institutionalization of and changes in legitimacy beliefs). He is interested in natural experiments (e.g., regression discontinuity design and standard natural experiments) and their application in management and organization studies.