Path dependency

from Wikipedia, the free encyclopedia

Path dependence is a concept in the social sciences . It describes process models whose course resembles a path .

As with a path, there are beginnings and junctions where there are several alternatives to choose from. At this crossing point, path-dependent processes do not behave deterministically , but chaotically . A small influence can have a big effect here and lead to a completely different outcome.

After a certain alternative has been established, a stable phase follows. Positive feedback effects reinforce the path taken, e.g. B. positive feedback effects in business . Smaller influences hardly cause any deviation in direction. While other alternatives were still relatively easy to reach at the crossing point, a conscious swiveling in the stable phase becomes significantly more complex.

In this way, a path may be held onto even if it later turns out that an alternative would have been superior. Path-dependent processes are therefore not self-correcting, but rather solidify u. A. also mistakes.

Schematic concept of path dependency

Standard polya process

The concept of path dependency can easily be illustrated using the standard polya process . There is a blue and a green ball in an urn. A ball is drawn out blindly. The probability of a color being drawn is 0.5. The drawn ball is put back again. Another ball, which has the same color as the one just drawn, is now added. There is now one more ball in the urn than before the train. If a blue ball was drawn, the probability of another blue ball being drawn is 0.66. This process, also known as the standard polya process, is path-dependent, as the probability of pulling a ball that has a desired color is related to the number of balls of that color. There are positive feedbacks, also known as “self-reinforcing effects”. Even the first move is highly relevant, as the number of balls may still be small and the dragging and subsequent addition of a ball has a significant effect on the later course.

Properties of positive feedback processes

The economist Brian Arthur, whose work together with that of Paul Davids founded the concept in the second half of the 1980s, saw path dependency as a typical property of economic processes with increasing marginal returns :

  1. Multiple equilibria: It cannot be predicted which of the potentially possible events will actually occur, since those that occurred at the beginning of the process have a major influence on which result can be expected further on.
  2. Possible pathway inefficiency: A path that is taken, which is quite promising, can, over a certain period of time, generate smaller returns than its alternatives.
  3. Lock-in: In addition, a chosen path of movement can harden. This can therefore only be left with difficulty or revised. More promising alternatives are excluded (lock-out).
  4. Path dependency: Even the early distribution of market shares has a major influence on which final result will be achieved. These market shares therefore show a non-ergodic dynamic.

Path dependence in economics

Traditional approach

Traditionally, economics has focused more on finding points of equilibrium . In neoclassical theory , for example, these arise from the interplay between supply and demand. Your point of view leads to a model of the economy that is predictable and efficient. Every step that takes the system away from equilibrium triggers negative feedback effects that push the system back into equilibrium. The equilibrium can be described as the best and most efficient distribution of resources under the given circumstances.

Positive feedback effects

In the 1980s, the negative feedback tradition faced increasing criticism. Well-known economists turned to processes in which, on the contrary, positive feedback effects led to developments on rather randomly selected paths. Self-reinforcing moments meant that every step in the direction initially taken was inappropriately rewarded with new advantages, so that the direction increasingly solidified, regardless of its quality. Douglass North , who received the 1993 Nobel Prize for Economics for a work in which he argued with path dependency regarding the formation of variants of capitalism, helped this approach to a breakthrough in economics.

Introduction of new technologies

New technical developments provided the first fertile ground on which path dependency in business was studied. Complex technology that is widely used, such as the PC, the Internet or entertainment electronics, tend to be path-dependent. As self-reinforcing moments, there are high advance payments on the developer side, which give the inventor a great initial advantage in the competition for standards. Experts and first accumulated learning experiences also urge us to continue the development in the direction initially taken. On the user side, there are investments in connection technologies, devices and corresponding training measures that require coordination and encourage people to determine the winning standard as quickly as possible. There is no fair competition between competing alternatives. The decision is made too quickly and the self - reinforcement mechanism does not lead to more quality, but to a lock-in situation , i.e. H. to freeze a possibly not very functional standard and user habits, to which all further developments must then dock.

Examples

  1. With the QWERTY keyboard layout , what was learned was the decisive factor in adopting it as the standard from the typewriter age to the computer age without further testing. It was originally chosen by the inventor of the typewriter to compensate for mechanical defects in the typewriter that no longer existed in the computer keyboard. It would therefore have made sense to have an ergonomic approach, which was also suggested but did not prevail. Lock-ins are repeatedly called into question by technical innovations, including the QWERTY keyboard with a changed input mode for the short message service on mobile phones, to which young users adapted very quickly. The QWERTY arrangement is still tough, as you can see on the keyboards of smartphones .
  2. When VHS technology for video recorders won against the competition, it was also no technical advantage, but rather clever tactics with the providers of films that made the difference. The standard then held its own until the introduction of the superior DVD technology.
  3. Since the web browser Internet Explorer from Microsoft to its Version 8 by the standards body World Wide Web Consortium established standards of markup languages HTML and CSS incorrect dominated, had a web designer either waive certain techniques or write deliberately faulty code, with which the sample code which IE did not understand, had hidden from him. Since IE was pre-installed as the standard browser on the dominant PC operating system MS Windows , it also had a dominant position on the Internet and could not simply be ignored as faulty.

Location development

The development of locations is a more traditional example of path dependency. Today, a high-performance communication and transport infrastructure makes it easier to bridge spatial distances, so that the location has lost its importance. Nevertheless, centers for knowledge areas and industrial or service clusters such as the IT industry in Bangalore (India) are still emerging , in which an initial upward movement like a magnet attracts experts, financial service providers and other infrastructure, so that the process soon becomes independent and the site blooms even without further direct influence.

Institutions

Douglass C. North found the same self-reinforcing effects known from technological standards in institutions . Establishing institutions is also time-consuming. It sets learning effects and expert training in motion. Coordination effects result from direct contracts between companies and the institution as well as from newly opening market opportunities for which the institution is preparing the way. If it can be expected that a newly founded institution will prevail, the companies or the population will often adapt with foresight.

According to Douglass North, path dependency affects not just a single institution, but the institutional infrastructure of a state as a whole. He calls this the institutional matrix of a state. As people get used to institutional settling disputes, establishing one institution paves the way for others.

Institutions, however, are less malleable than technologies and, compared to these, are also less flexible in adapting to changing environmental conditions. If they collapse, a large part of the implicit knowledge incorporated into them threatens to be lost, and with it also the problem-solving techniques. Paul David points out that, because of these impending structural breaks, it is often not possible to bring about effective institutional change, even if the new institutions seem theoretically more efficient than the old ones.

Economic growth

In 1993, Douglass North received the Nobel Prize in Economics for his work on economic and institutional change. North's starting point was the observation that economic growth develops very differently from country to country. He came to the conclusion that economic growth is path-dependent, since the motivation of the actors in the economy depends on the institutional infrastructure of a country and this develops in accordance with the path.

Organizational path dependency

Course of path-dependent processes
Jörg Sydow , Georg Schreyögg and Jochen Koch 2009

Path dependence as a phenomenon is also dealt with in organizational theory . Under the term “organizational path dependency”, tendencies towards entrenchment in companies and organizations are researched. If positive feedback, which is characteristic of path-dependent processes, has an effect, for example in research and development or business models, in the long term, companies may be so committed to a certain option that they can no longer respond effectively to market changes. Attempts by management to take countermeasures no longer lead to success in the case of path dependency. The German Research Foundation promoted from 2005 to 2013, a graduate program at the Free University of Berlin , which, however, dealt specifically with organizational path dependence, in particular barriers to innovation and competency traps with possibilities of the path breaking. Points of contact for work on path-dependent processes in organizational theory and organizational sociology can be found in research on routines and practices , organizational learning and innovation management .

The results of this research include a. a study that shows how path dependency in personnel policy contributes to maintaining hyperinclusion as an informal entry condition to top management.

Path dependence in politics

In political science tied Paul Pierson on the work of Douglass North. There are four components in politics, each of which has a self-reinforcing effect: institutional development, collective action, asymmetries of power and the complexity of world views. In the meantime, various considerations in comparative political science are linked to the last point, which make religious cultures or colonial experiences in particular responsible for the path-dependent development of democratization . The most important authors here are Ronald Inglehart and Samuel P. Huntington .

Institutional development

Institutions are at the same time an object and form the framework for political action. The path dependence of institutions thus leads to the path dependence of politics as a whole. Pierson argues that the institutional path dependency in politics is partly deliberate. Political stability cannot be achieved in terms of personnel, especially in democracies with changing governments . Laws and institutions give the incumbent politician the opportunity to create policies that will outlast his term of office. The politically stable climate created in this way is desired by the population and the economy alike.

Collective action

Politics is also shaped by collective action , in which adjustment expectations play an important role. In many cases there is only one winner, such as a law that prevails or a party to win the election. The political actors are constantly trying to align their actions with the supposed actions of others. Many actions of collective action, such as founding a party or organization, also involve high start-up costs. The rigid party systems in many European countries and the USA can be traced back to path dependency. A similar rigidity in organization and membership can be observed in many voluntary organizations and associations.

Asymmetries of power

Politicians in office can steer laws and institutions in a direction that will give them and their party an advantage in future elections. Paradoxically, this obscures the balance of power over time, since differences with other interest groups no longer have to be openly dealt with after a shift in the balance of power in favor of the government. Instead, the government can then switch to ideological manipulations that do not allow those who think differently to have their say.

complexity

The complexity of the matter makes it difficult for an individual to develop a political vision on his own. Actors therefore seek help and advice from others and prefer like-minded people, which also leads to self-reinforcing effects. Instead of a correction of the individual worldview, there is often a further strengthening of the chosen direction.

Correction options

Path-dependent processes and developments tend to solidify errors. After an initial crossing point, they lead to a stable phase in which disruptions only lead to small variations of the chosen path because alternatives are no longer perceived or because there are no resources or competencies available that can be used to cope with requirements other than those known ( so-called competence trap ).

This leads to the important question of how one can abandon a path that has turned out to be unfavorable. In general, the path taken must be shaken sufficiently large to open a new crossing point. This shock can have various causes. Competition and learning effects play a role above all in the economy, while in politics opposing processes can permanently disrupt paths and revise developments. But tremors can also be triggered by external causes, such as natural disasters or the collapse of a government.

competition

On the one hand, the market mechanism favors the development of path dependency (e.g. many companies adapt to de facto standards), but on the other hand it also contributes to the dissolution of paths. This is probably the more common variant: Industry standards often become irrelevant due to the introduction of a new, superior technology, as in the case of the replacement of video cassettes by DVDs. In the case of locations, new centers can form in competition, which challenge and eventually replace the old ones.

Learning effects

Learning effects often play a major role in correcting paths. For example, CFCs were banned in many countries by the Montreal Protocol in 1987 after it became known that they had a negative impact on the ozone layer in the earth's atmosphere. This marked a new crossroads for the development of cooling chemicals in the industry. The switch to renewable energies is also taking place today through learning effects based on new knowledge about the climate-warming effect of fossil fuels.

Opposing processes

In the case of institutions, however, competition and learning effects are low. Opposing processes are often required here in order to initiate far-reaching reforms. Processes running in opposite directions mean developments outside of the institutions that run parallel in time and that put obstacles in the way of the path-dependent development of the institutions. It could be, for example, a gradually growing dissatisfaction among the population that builds up and eventually discharges when a certain threshold is exceeded, for example when unemployment exceeds a certain percentage.

additions

There are further examples of path-dependent developments:

  • The hysteresis describes a system behavior in which the output variable depends not only on the independently changeable input variable, but also on the previous state of the output variable. Therefore, depending on its previous history, the system can assume different states with the same input variable. Examples are the magnetization of ferromagnetic materials or the two-step controller in the control technology .
  • Heinz von Foerster designed a non-trivial machine (NTM) in his work on cybernetics . This machine is composed of two trivial machines (TM) inside . Hence they are called synthetically determined. However, the two TMs are linked to one another via an internal state variable in such a way that the NTM behaves in a path-dependent manner. In addition, the NTM cannot be determined analytically. This means that an observer cannot infer its internal structure from the external behavior of the NTM.
  • Thomas S. Kuhn has demonstrated path dependency in science and coined the term paradigm for phase III . Here it is primarily public funding that is concentrated on the predominant research field in such phases. Specialist conferences align their key topics accordingly and specialist journals primarily accept corresponding contributions, because in view of the increasing number of institutions and people who are turning to the paradigm, the number of participants and circulation can be increased. Above all, the peer review, the mutual control among scientists, contributes significantly to the fact that work outside the paradigm in phase III hardly gets a chance. A resulting advantage is that, thanks to the bundling of capacities in the predominant research field, great progress can be made relatively quickly. The disadvantage, however, is that alternative possible solutions and other issues remain undetected, regardless of their quality and urgency.
  • In the case of people, one speaks of the career path or career path . This way of speaking is based on the one hand on the intuitive recognition of the path dependency of this area of ​​human development, on the other hand on the desire to be given a clear perspective when entering the profession.

Individual evidence

  1. ^ A b c Paul Pierson : Politics in time. History, Institutions and Social Analysis. , Princeton University Press, Princeton NJ et al. 2004, ISBN 0-691-11715-2 , pp. 10 f.
  2. ↑ Steven B Durlauf: path dependence . In: Steven N. Durlauf and Lawrence E. Blume (Eds.): The New Palgrave Dictionary of Economics . 2008, doi : 10.1057 / 9780230226203.1256 .
  3. ^ A b W. Brian Arthur : Increasing returns and path dependence in the economy. The University of Michigan Press, Ann Arbor MI 1994, ISBN 0-472-09496-3 .
  4. ^ Paul A. David : Clio and the Economics of QWERTY. In: American Economic Review. Vol. 75, No. 2 = Papers and Proceedings of the Ninety-Seventh Annual Meeting of the American Economic Association , 1985, ISSN  0002-8282 , pp. 332-337.
  5. ^ A b Douglass C. North : Institutions, Institutional Change and Economic Performance. Cambridge University Press, Cambridge et al. 1990, ISBN 0-521-39416-3 .
  6. ^ Paul David: Why Are Institutions the 'Carriers of History'? Path Dependece and the Evolution of Conventions, Organizations, and Institutions. In: Structural Change and Economic Dynamics 5 (1994) 2, pp. 205–220, here: 218 f.
  7. ^ List of Nobel Prize Winners in Economics
  8. ^ Jörg Sydow , Georg Schreyögg , Jochen Koch: Organizational Path Dependence: Opening the Black Box. In: Academy of Management Review. 34 (4). (online at: wiwiss.fu-berlin.de )
  9. ^ Graduate college set up to study path dependency within organizations of organizational processes
  10. ↑ P. Erfurt Sandhu: Persistent Homogeneity in Top Management. Organizational path dependence in leadership selection , dissertation, Department of Economics at the Free University of Berlin, 2013. See Chapters VI and VII (pp. 167–208) in English, abridged version of the dissertation (in German), p. 215.
  11. ^ Seymour M. Lipset, Stein Rokkan : Cleavage Structures, Party Systems and Voter Alignments: An Introduction. In: Seymour M. Lipset, Stein Rokkan (Ed.): Party and Voter Alignments. Cross-national perspectives. (= International Yearbook of Political Behavior Research. Vol. 7). Free Press et al., New York NY 1967, pp. 1-64.
  12. ^ Theda Skocpol , Marshall Ganz, Ziad Munson: How Americans Became Civic. In: Theda Skocpol, Morris P. Fiorina (Eds.): Civic engagement in American democracy. Brookings Institute Press et al., Washington DC et al. 1999, ISBN 0-8157-2810-7 , pp. 27-80.
  13. ↑ Gottlieb Daimler and Carl Benz Foundation: (Ed.): From innovation lead to competence trap. 2008. (online at: daimler-benz-stiftung.de )
  14. ^ Heinz von Foerster: Knowledge and Conscience . Ed .: Siegfried J. Schmidt. 7th edition. Suhrkamp pocket book science, Frankfurt am Main 1993, ISBN 978-3-518-28476-6 , p. 245-252 .
  15. ↑ Thomas S. Kuhn: The structure of scientific revolutions . 18th edition. Suhrkamp pocket book science, Frankfurt am Main 1996, ISBN 978-3-518-27625-9 .

Web links