Repercussions of actors’institutional experimentations in a transitioning late-industrialized economy

Abstract

This research investigates why late-industrialized economies that have successfully accumulated technology capability face challenges in reaching industrial leadership in frontier technology sectors. Building on institutional theory, specifically concerning how transition failure of institutions constrains the market entry of innovations, attention is directed to the role of actors in legitimizing new practices when exogenous changes create opportunities for institutional reconfigurations. The Thesis suggests that actors’ greater degrees of experimentations may undermine the performance of frontier innovations particularly in the context of a transitional institution. This proposition is further examined by exploring how the fluidity in actors’ experimentations yield unintended repercussions on the coordination of a collective agency. Data collected from the cases of Online Electric Vehicle, Fuel Cell Electric Vehicle, and Energy Storage System in Korea are analyzed in complementary investigations. The first study utilizes the partial least squares structural equation modelling technique to test the relation between institutional agency, control, and innovation performance. The results indicate that while institutional agency is constrained by institutional control among actors, it holds a significant negative effect on the performance of innovations. The second study investigates the nature of agency during actors’ experimentations through in-depth qualitative case analyses. Findings suggest that the fluidities in actors’ logic centrality and work intensity diverge flagship industrial actors’ attentions and constrain the entry of new actors during the development and deployment of the technologies. This research provides an alternative perspective to literature that have generally emphasized the positive role of actor-based institutional change during the innovation process. In particular, the paper contributes to catch up and transition literature by discussing possible repercussions of actors’ different degrees of institutional experimentations while expanding institutional theory by demonstrating how actors’ purposive agentic activities rarely persist during the innovation process and therefore fail to enable institutional change.