Institutional Dynamics

What is the relationship between the formal mandate of the organisation and the activities of its various stakeholders? PARI has pioneered the field of organisational and institutional studies in South Africa. Using social science methodologies researchers at the institute explore how organisations are structured and staffed, how resources are allocated and personnel incentivised and how power is exercised and legitimised to understand what organisations do and why.

Our work often draws on the distinction between organisations and institutions, first suggested by institutional economists in the 1980s. That is, if organisations refer to groups of individuals, allocated resources and tasked with an objective, institutions are the rules and conventions that come to regulate their behaviour. Institutions can be formal, obeying official rules and laws or informal, obeying codes and conventions arising elsewhere. In some cases, institutions are very poorly embedded and/or there is conflict between the formal and informal institutions. The challenge for governance is to align institutional practices with organisational goals. Whereas economists approach such alignment as a challenge of incentives, we focuse on questions of power. Who wields it and how? Alignment, in this sense is also about making sure that power is located in the right places and is exercised appropriately.