Combinations of Sectors Across and Within Organizations

• In Event: Examining Sectoral Boundaries

Abstract

The Sectoral Advantage Framework (SAF) (Steinberg et al., forthcoming) is a structure for coordinating theories from multiple areas and disciplines to understand why activities are located in particular sectors and which activities are best suited to each sector. That paper generalized three-failures theory to incorporate the family as a fourth sector, suggested consistent criteria to talk about comparative sectoral advantages and disadvantages, and incorporated a broader range of political systems, including autocracy and failed states as well as democracy. Nonetheless, there is a dearth of theories on why activities occur in combinations of sectors or within hybrid organizations. Nor is there a comprehensive theory that explains the comparative advantages of combinations of sectors. In this paper, we take several steps towards the development of a comprehensive theory of combinations that can be embedded in the SAF.

First, we develop a comprehensive typology of sectoral combinations, extending existing typologies that look at only part of this diversity (such as typologies for social enterprises or public/private partnerships). Our typology is designed to distinguish combinations that result in particular advantages. It has three dimensions: alignment (independent, complementary, or adversarial), governance (formal or informal, hierarchic or power sharing), and sectoral composition.

Next, we analyze the effect of competitive forces on combination performance and distinctiveness. This requires attention to some cross-sectoral market structures that have not been well-defined in existing literature, and we try to fill in definitional gaps and analyze the determinants of cross-sectoral market structure. Cross-sectoral competition has effects on performance that differ from within-sector competition.

Next, we examine other forces that affect combination performance, including externalities and transaction costs. We conclude with a general assessment of how combinations enrich pluralism and how they affect polarization and accountability (both positively and negatively).

References

These are selected from the partial draft of our paper available on the proposal submission date. Of course, many more will be added as we complete the paper.

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Authors

• Richard Steinberg, Indiana University Indianapolis

• Liza Taylor

• Teresa Harrison, Drexel University Center for Nonprofit Governance