Density Dependent Organizational Evolution in the American Brewing Industry from 1633 to 1988

Abstract

The ecological model of density dependent organizational evolution is tested using data on the 7,709 breweries operating in the American market. Besides covering the longest time period studied to date, these data allow for exammacon of three important issues that critics of the model have raised: (1) applicability to commercial business organizations; (2) plausibility of alternative interpretations involving size and mass; and (3) measurement of legitimation. Estimates of stochastic rates of organizational founding and mortality show that, while there is ment in some of the criticisms, both rates are nonetheless non-monotomcally related to organizational density in ways predicted by the model. In most instances, these relationships persist when the rate functions are specified with different socio-economic control vanables. The strong support found for the model helps reconcile some previously reported negative evidence