State-owned Enterprises as Institutional Market Actors: A Gradual Institutional Change Perspective on Domestic SOEs in the Marketization of Public Services

Lene Tolstrup Christensen

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This chapter suggests conceptualizing domestic SOEs in the marketization of public service provision as institutional market actors (IMAs) based on the theoretical perspective of gradual change in historical institutionalism. The notion of the SOE as IMA extends the historical and contemporary conceptualization of SOEs as either policy tools for the state or hybrid organizations in commercial markets with an approach that incorporates both dimensions. The argument is threefold. First, in the analysis of domestic 100 percent SOEs in the context of marketization, there is a need to distinguish between two separate but interdependent processes: internal marketization as different levels of corporatization and external marketization as different levels of liberalization. Second, the perspective on gradual institutional change stresses the importance of considering the historical and political institutional context and the actors’ interpretations in any analysis of institutional change. Third, the IMA is conceptualized in four dimensions. The first dimension is that the IMA is a corporatized and 100 percent SOE selling public services with a price tag and reflecting the shift from a bureaucratic to a professionalized ownership relationship between the SOE and the state. The second dimension underlines the fact that the IMA has become one market actor among others as it faces competition in its former monopoly activities. The third dimension is that the IMA plays a sectoral role stemming from its legacy as a monopoly; this explains the existence and organizational form of a policy dimension required for an understanding of the contemporary SOE. The fourth dimension explains how the sectoral role develops both formally and informally with the SOE as an interpretive rule taker, and it serves to highlight a new way of understanding contemporary SOEs and marketization. Along with the institutional setup of reforms, the analysis of contemporary SOEs in the context of marketization should highlight the actors’ interpretations and agency over time and pay attention to the analytical aspects of process, time and context.
Original languageEnglish
Title of host publicationThe Routledge Handbook of State-owned Enterprises
EditorsLuc Bernier, Massimo Florio, Philippe Bance
Number of pages17
Place of PublicationAbingdon
Publication date2020
ISBN (Print)9781138487697
ISBN (Electronic)9781351042543
Publication statusPublished - 2020
SeriesThe Routledge Handbook of State-Owned Enterprises

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