Formatting large numbers of exchanges: how to address organised regularities in markets
Event Date: 5 November 2014
Speaker: Dr. Luis Araujo is a Professor of Industrial Marketing at Lancaster University Management School.
Time: 1.30pm. Lunch from 12.30pm.
Location: McCance building, room 303.
Abstract: This study addresses the notion of organized regularities in markets which are usually addressed from an institutionalist angle. Institutions are either seen as constitutive (e.g. categories, scripts) or regulative forms (e.g. values norms). The first view is favoured by sociological approaches whilst the latter approach is promoted by institutional economists (DiMaggio, 1994). Our starting point is that an organized regularity is anything that gives form to relations between entities. We borrow Laurent Thévenot’s (1984) notion of form and investments in form to investigate how exchanges in markets are often pre-formatted by significant investments. A form is characterized by its capacity to generate temporal and spatial equivalencies, allowing us to move from the particular (e.g. an exchange) to the generic (e.g. an exchange with a particular type of customer).
Our empirical focus is on the creation of new market form, frequent flyers, following the US Airline Deregulation Act of 1978. Under the previous regulatory regime, the US Civil Aeronautics Board controlled routes and prices and airlines were limited to competing on frequency and quality of service. Deregulating the skies meant lower prices, higher load factors, and new entrants in the airline industry. Two years later, 21 out of the 25 largest US carriers either had their own frequent flyer program, or participated in another carrier’s program. The original idea was to award frequent flyers with something they valued, at little cost to the airlines. We show how successive rounds of investments helped consolidate the form, and induced novel and unintended behaviors (e.g. flying to maximize miles) as well as the emergence of new market agencies (e.g. guides to frequent flying programs).
Dr Araujo's research interests and publications are in the area of business markets, namely the boundaries of the firm and product–service systems. His recent work focuses on a practice-based approach to the study of markets. Luis is a co-editor with Hans Kjellberg and John Finch of Reconnecting Marketing to Markets (Oxford University Press, 2010) and an associate editor of Marketing Theory.
Published: 20 March 2018
