Social Movements, Stakeholders and Non-Market Strategy

Forrest Briscoe, Brayden King, Jocelyn Leitzinger, Forrest Briscoe, Brayden King, Leitzinger

• Publisher: Emerald Publishing Limited
• Year: 2018
• ISBN:
  9781787543515
• Topic: Negocios y empresa
• Subtopic: Comportamiento organizacional

This volume brings together new research that bridges the domains of stakeholder theory, non-market strategy and social movement theory. Although these three research domains have developed via relatively distinct academic communities, they speak to a common set of phenomena at the intersection of business, markets, civil society, and the state. This collection sets an agenda for a more holistic theory of business and society – a theory that takes seriously the various kinds of stakeholders that make up society and have claims over business, that incorporates the goals and objectives of businesses to survive and thrive, and that places an important role on the process of mobilization and contentious interaction between actors whose goals inherently conflict. Using a range of quantitative and qualitative methods, contributors focus on a phenomenon at the intersection of business, civil society, and government. Examining markets shaped by heavy stakeholder involvement and contention, chapters explore topics such as markets for electric vehicles, medical marijuana, municipal drinking water, and cigarettes along with controversial business practice, including employment practices for LGBT workers and racial/ethnic minorities, and working conditions in global supply chains.

SECTION I

SOCIAL MOVEMENTS AND ORGANIZATIONAL THEORY

CHAPTER 1

PLUG POWER. SOCIAL MOVEMENTS AND ELECTRIC VEHICLE CHARGING STATIONS IN CALIFORNIA, 1995–2012

Sunasir Dutta, Hayagreeva Rao and Ion Bogdan Vasi

ABSTRACT

Do social movement organizations increase the supply of a public good? We address this question by investigating the role of generalist social movement organizations and technology-focused organizations for the development of the electric vehicle (EV) charging infrastructure in California from 1995 until 2012. We find that increases in the membership of Electric Auto Association (EAA) chapters in the cities of California enhanced the number of EV charging stations set up in each city. Our analyses also show that the organizational diversity of the environmental movement spurred the growth of EAA membership but did not directly increase the establishment of charging stations.

Keywords: Social movements; technology; diffusion; electric cars; Public Goods; organizational diversity

A growing number of studies suggest that collective action is essential for the spread of new technologies that underlie new industries (Hargrave & Van de Ven, 2006). In this narrative, activists are the bedrock – they are not just lead users who introduce new products (e.g., Von Hippel, 2007) or hobbyists who establish new firms (Shah & Tripsas, 2007), but instead, form social movement organizations that expand the opportunities for entrepreneurs and consumers. Thus, early auto enthusiasts established automobile clubs and organized reliability races to demonstrate the reliability of the car and improved the survival of winning organizations (Rao, 1994). Similarly, homebrewing clubs attacked “industrial beer” produced by the big producers and organized festivals to share ideas that created a new niche for craft beer producers (Carroll & Swaminathan, 2000). Members of environmental organizations spread information about the moral value of renewable energy technologies and spurred entrepreneurial activity (Sine & Lee, 2009; Vasi, 2011). Hiatt, Sine, and Tolbert (2009) show that growth of temperance instruction in schools delegitimized alcohol and promoted the foundings of soft drinks firms. These studies usefully emphasize that activists are information suppliers to markets (Feddersen & Gilligan, 2001) and thereby, shape the decisions of consumers and putative entrepreneurs to adopt new products and technologies. We extend this literature in two directions.

Firstly, research on social movements is ambiguous about the causal role of technology enthusiasts. To begin with, while activism looms large in the qualitative accounts of the rise of new industries, its causal significance is rarely demonstrated. Thus, Rao (1994, 2004) shows the reliability contests and wins in these races increased firm survival, but is silent about whether auto clubs themselves had any direct effect on the rise of new firms or the longevity of existing firms. Carroll and Swaminathan (2000) characterize craft-brewing in the United States as a social movement but their quantitative models of foundings and failures of craft brewer density treat as a causal driver rather than the membership of homebrewing clubs. Greve, Pozner, and Rao (2006) focus on the market shares of chain radio stations and community but do not directly consider the effect of activists per se. Similarly, Sine and Lee (2009) emphasize membership in the Sierra Club, at the state level, as a trigger of entrepreneurial activity in the wind power sector but their quantitative analyses shed little light on wind power enthusiasts and the effects of other environmental organizations – see Vasi (2011). Recent research shows that technology-focused Social movement organizations (SMOs) (TSMOs), or “specialized SMOs that exclusively focus on supporting the development and adoption of a specific technology to advance social goals” (Pacheco, York, & Hargrave, 2014, p. 1610) contribute to industry development. Largely missing from these studies, however, is an analysis of the way in which SMOs influence industry development not only directly but also indirectly, through TSMOs.

Secondly, these studies say little about whether social movements and technology enthusiasts matter for the production of public goods – goods that are non-excludable in their supply – that is, there is no way to actively prevent other people from consuming it, and whose consumption is non-rivalrous – that is, consumption by one individual does not reduce its supply for others. These characteristics of public goods lead to the free-rider problem, with individuals having little incentive to produce them (Olson, 1971). In practice, public goods span a wide range: they subsume club goods (e.g. toll roads) which are excludable and partially rivalrous in their consumption (e.g., congestion of roads), common goods which are non-excludable and but rivalrous in their consumption (e.g., hunting grounds), impure public goods which are non-excludable but only partially rivalrous in their consumption (e.g., ocean fisheries), and pure public goods which satisfy the criteria of non-excludability and non-rivalrous consumption such as pollution control or sound governance (Sandler, 1998). Often, these kinds of goods require activism by activist–enthusiasts if only to pressure state and public authorities to provide them. For example, while Henry Ford is lauded as the iconic figure who spreads the automobile, the mass produced Model T would never have spread, had there been no roads. It was the “Good Roads Movement” powered by bicycle enthusiasts and then automobile clubs who demanded better roads from legislatures, and thereby, created the infrastructure that made the spread of the automobile possible (Flink, 1970). An important, yet previously unexamined, pathway of influence for social movements is the impact they have on public goods that pave the way for industry development.

These considerations provide the motivation for us to investigate the causal role of the environmental movement and technology enthusiasts in California from 1995 until 2012 in the electric vehicle (EV) industry. Since EVs run on batteries that need to be recharged, “range anxiety” is an issue for consumers. A simple way to reduce range anxiety is to ensure the easy availability of public electric vehicle charging stations (EVCS) that allow cars to be plugged in and powered up – hence, the establishment of public charging stations in communities is essential for the widespread adoption of electric cars. While car owners may charge their electric cars at home, public charging stations make the use of electric cars convenient, and are often established by local governmental authorities in municipalities and townships; therefore, they may be thought of as a kind of impure public good. As we argue in detail below, the growth of EV charging network is likely to depend on electric car enthusiasts and their TSMO, in particular the Electric Auto Association (EAA). Moreover, the development of these charging stations is also likely to depend on environmental activists, because they are likely to support electric cars are less polluting than conventional cars.

We examine whether the environmental movement has contributed to the growth of the charging stations network. We anticipate that both SMOs and TSMOs had direct effects; more specifically, we expect that both environmental organizations and EAA contributed to the development of EVCS. We also hypothesize that SMOs have indirect effects; the higher the organizational diversity of the movement, the stronger the effect of increases in EAA membership on EVCS. These indirect effects are suggestive of institutional relay, a salient mechanism by which movements have effects on targets outside movements’ original target zones through intermediary institutions and actors (Haveman, Rao, & Paruchuri, 2007; Katzenstein, 1998). We employ a mixed-methods approach: we begin with interviews with electric auto enthusiasts to understand evangelism and their relationship with the environmental movement; then, we employ control function approaches (Wooldridge, 2010) to test the hypotheses and address issues of endogeneity.

SOCIAL MOVEMENTS AND PUBLIC GOODS

Students of social movements have focused attention on the direct effects, that is, the effect of mobilization on the intended goals of a movement such as new programs and policies. An important area of research has focused on movements’ effects on the spread of new technologies and industries (Hargrave & Van de Ven, 2006). Studies have shown that activists are not just users who introduce new products (e.g., Von Hippel, 2007) or entrepreneurs who establish new firms (Shah & Tripsas, 2007); they also contribute to a socio-cultural climate that expands opportunities for entrepreneurs and consumers. Because social movement participants are information suppliers to markets (Feddersen & Gilligan, 2001), they shape the decisions of consumers and putative entrepreneurs to adopt new products (Hiatt et al., 2009). For example, environmental organizations spread information about renewable energy technologies and spurred entrepreneurial activity in the clean tech sector (Sine & Lee, 2009; Vasi, 2011). In addition to regular SMOs, specialized SMOs that focus on the adoption of a technology, labeled technology focused or TSMOs, may also shape the adoption of technologies by undertaking activities that promote cultural and sociopolitical changes (Pacheco et al., 2014).

In the case of the EV industry, environmental SMOs are likely to contribute to the growth of the charging stations. The rise of the environmental movement, triggered by Rachel Carson’s Silent Spring in 1962, transformed the American political and cultural landscape and led many to support alternative forms of energy such as wind power (Sine & Lee, 2009; Vasi, 2011). Environmental groups stimulated public interest in electric cars starting in the late 1960s and 1970s. As air pollution and nuclear power became major issues that attracted growing public attention, environmental activists started to search for alternatives to nuclear power and fossil fuels. The anti-nuclear campaigns of the 1960s and 1970s, for example, led to the emergence of grassroots groups that worked on wind turbine technology in Europe and the United States (Vasi, 2011). Environmental activists frequently argued that, as more electricity was produced from renewable sources, electric cars could be a viable solution for the problem of air pollution.

A number of environmental groups sought to accelerate the adoption of EV technology by emphasizing the superior efficiency of EVs and by seeking to dispel erroneous beliefs about their feasibility. For example, The Union of Concerned Scientists published a study in 1980 which argued that

the efficiencies of electric vehicles may be improved by means that are not available for conventional fuel driven vehicles. For example, “...