The creation of markets for new products involves interplay between various field constituents. A major challenge in this process is to establish a sufficient level of legitimacy in order for a market to become accepted in the organization field. Yet, this process of market creation may be suppressed by established institutional arrangements that actively block the diffusion of innovations and constrain change. In this paper, we examine the roles of regulatory structures, professional associations and competitors in market suppression. We pay particular attention to the actions and circumstances preventing change in a mature sector of the economy, despite state policies directed at change. Active resistance from professional associations and corporate actors inhibited creation of a new market. We draw upon institutional theory to provide an account of the different communities of interest involved in an institutional field, exploring how they are developed and negotiated. We argue that the role of the government and the impact of its policies in market construction may be overemphasized and that the complexity of its interaction with organizational fields may be underestimated.
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