Gridlocked: Interlocking Directors and Inertia in the Philippine Energy Industry, An Analysis of Social Influence

• In Event: New Approaches in Social Network Research: Theory, Methods, and Applications - Open Call Paper Session

Abstract

By analyzing the corporate network of a seemingly peripheral social formation in the world economy, I interrogate the underlying forces of social influence among firms through an integrated structural and historical analysis. Whereas numerous studies have convincingly shown that behaviors can become ‘contagious’ through direct contact, structural equivalence, and mutual reinforcement, the mechanisms that influence which of these processes predominate in any given situation remain elusive. I analyze a novel dataset of the interlocking directorate network of all 115 publicly listed energy industry firms in the Philippine Stock Exchange, supplemented by Department of Energy contracts, annual disclosures, sustainability reports, and news sources to operationalize industry involvement. I leverage a mixed-method approach comprising of newly developed techniques in social network analysis – Autologistic Actor-Attribute Models (ALAAMs) – alongside a historical analysis of developments in the Philippine state’s approach to resolving its perennial energy issue through industry rationalization. The results of statistical modelling demonstrate the inadequacy of relying on network structure alone to explain the diffusion of behavior: it predicts a counterintuitive pattern in renewable energy involvement where simple contagion is negatively associated with adoption, while transitive contagion is positively associated with it. I argue that these effects become intelligible only when situated within the historical organization of the Philippine energy sector – privatization under EPIRA and elite kinship-based corporate coordination that mediates competition. The study therefore contributes to debates on embeddedness and social influence by showing that network structures do not operate as universal mechanisms of social influence; instead, their effects are rooted in the intersection of historically contingent social factors specific to each situation. These findings also have substantive implications for studying development within the context of international climate governance by reopening conversations about the state’s role in climate-critical industries and the consequences of privatizing public services such as energy.

Author

• Richard Christopher Tamayo Kahulugan, University of Wisconsin-Madison