Path dependence

Path dependence is an analytical concept in the social sciences, the process models describing the time course structurally similar to a path. As with any path, there are also the beginnings and intersections where several alternatives or paths to choose from. Then, after selection of that alternative, followed by a stable phase in which the development is maintained by positive feedback effects on the chosen path. While small disturbances can have a great effect at the crossing points, they cause in the subsequent stable period hardly any deviation direction. A later switching to one of the crossing point still easily attainable alternatives is in the stable phase after the decision increasingly complicated since feedback effects build up obstacles. Thus, we find a path may even held when it turns out later that another alternative would have been superior.

The special feature of path-dependent processes is that they behave non-deterministic, but chaotic at the crossing points. A small disturbance via positive feedback to an entirely different output. On the other hand, the transition takes place in a stable phase regardless of the quality of the decision made, path-dependent processes are not self-correcting, but on the contrary predestined to solidify error.

• 3.1 Institutional Development
• 3.2 Collective action
• 3.3 Asymmetries of power
• 3.4 complexity

• 4.1 competition
• 4.2 Learning effects
• 4.3 Opposing processes

Path dependence in economics

Traditional approach

Traditionally, the economics are more focused on finding equilibrium points. These arise, for example, in neoclassical theory by the interplay of supply and demand. Your point of view leads to a model of the economy, which is predictable and efficient. Every step that leads away from equilibrium, the system triggers negative feedback effects that push back the system to the equilibrium state. The balance can be described as the best and most efficient allocation of resources in the circumstances.

Positive feedback effects

In the 80s saw the negative feedback tradition of growing criticism. Renowned economist turned to processes in which the contrary led to positive feedback effects that promote developments in rather randomly selected paths. Self-energizing moments meant that every step in the first direction taken was inappropriate rewarded by new benefits, so that the direction of increasingly solidified regardless of their quality. Douglass North, the 1993 Nobel Prize in Economics was awarded for a work in which he argued regarding variant form of capitalism with path dependence, so that helped this approach in economics to break through.

Introduction of new technologies

New technical developments offered the first fertile soil, was studied on the path dependency in the economy. Complex technology, which finds a wide distribution, such as the PC, the Internet and consumer electronics, tend to path dependence. As a self-reinforcing moments arise here on the developer side high inputs that bring a great start in the competition for standards to the inventor. Experts and first collected learning experiences also urge to lead the development of the initially chosen direction. On the user side, there are investments in connection technologies, equipment and appropriate training that require coordination and tempt us to determine the winner standard as soon as possible. It does not come to a fair competition of competing alternatives. The decision is made ​​prematurely, and the self-servo mechanism does not lead to more quality, but to a lock-in situation, ie to freeze a maybe little functional standards and user habits, in which then have to latch onto any further developments.

Examples

Site Development

The development of a more traditional locations is an example of path-dependence. Today, spatial distances can be easily bridged by a powerful communication and transportation infrastructure, so that the site has lost its meaning. Nevertheless arise even today centers of knowledge sectors or industries, such as Bangalore in India, where the first upward movement like a magnet experts, financial services and other infrastructure attracts, so that the process will soon become independent and blossoms of the site without further direct action.

Institutions

Douglass North was the same self-reinforcing effects that were known by technological standards forth in institutions again. The creation of institutions is also costly. She sits learning effects and expert education in transition. Coordination effects arise both through direct contracts with the institution as well as by newly opening market opportunities for the institution prepares the way. The expectation that the institution will prevail, also can be no doubt, so to adapt to a new institution on the part of the Company or of the population often occurs with foresight.

Institutional matrix

According to Douglass North, the path dependency not only affects a single institution, but the institutional infrastructure of a country as a whole. He calls this the institutional matrix of a state. As people get used to it, that disputes are regulated institutions, the establishment of an institution prepares the way for more.

Economic growth

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 the economic growth of a country-specific developed very different. He came to the statement 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 path-dependent develops.

Organizational path dependence

Path dependency is also treated as a phenomenon in organization theory. The term organizational path dependence consolidation trends are explored in companies and organizations in general. Has a characteristic of path-dependent processes of positive feedback example in research and development or business models, companies can be very determined under certain circumstances on a specific option in the long run, that they can not effectively respond to market changes. Counteract attempts by the management, lead in the case of path dependency no longer to success. The German Research Foundation sponsored from 2005 to 2013, a graduate program at the Free University of Berlin, which specifically dealt with organizational path dependence, in particular barriers to innovation and competence traps, but also with possibilities of path breakage. Starting points for work on path-dependent processes in organization theory and organizational sociology opportunities include in research on routines and practices, organizational learning and innovation management.

The results of this research is one among others a study that shows how path dependency in personnel policy helps maintain a Hyper inclusion as an informal condition of access to top management.

Path dependency in policy

In political science Paul Pierson drew on the work of Douglass North. In politics, there are four components that each act self-reinforcing for themselves: institutional development, collective action, asymmetries of power and the complexity of worldviews. On the last point now make a number of comments in comparative politics that make particular religious cultures or even colonial experience for the path-dependent development of the democratization responsible. The main authors are Ronald Inglehart here and Samuel Phillips Huntington.

Institutional Development

Institutions are also subject and provide the framework for political action. The path dependence of institutions thus leads to path dependency of policy as a whole. Pierson argues that the institutional path dependency is deliberate in politics to some extent. Particularly in democracies with changing governments can not be achieved political stability of personnel. Laws and institutions so give the incumbent politicians the opportunity to create policy that outlasts his tenure. The politically stable climate generated in this manner is desired population and the economy alike.

Collective action

Policy is also influenced by collective action, in which adaptation expectations play an important role. In many cases there is only one winner, about a law that asserts itself, or a party that wins the election. The political actors are constantly trying to align other their actions after the alleged act. Many actions of collective action, such as the constitution of a party organization also include high start-up costs. The rigid party systems in many European countries and the USA are due to path dependence. A similar rigidity in the organization and membership can be observed in many voluntary organizations and associations.

Asymmetries of power

Incumbent politicians can steer laws and institutions in a direction that gives them and their party in future elections advantages. Paradoxically, by the balance of power will be obscured with time because of differences with other interest groups for a shift in the balance of power in favor of the government no longer need to be dealt with openly. Instead, the government can then proceed to carry out ideological manipulation, the dissenters no longer a chance to speak.

Complexity

The complexity of the matter makes it difficult for an individual to put on yourself to develop a political vision. Therefore actors seek help and advice from others, and prefer doing like-minded people, which also leads to self-reinforcing effects. Instead of correcting the individual belief, it often comes to a further strengthening of the chosen direction.

Corrections

Path -dependent processes and developments tend to solidify error. Run after an initial intersection point to a stable phase in which disturbances lead only to small variations in the selected path, because alternatives are no longer perceived or because no resources or skills are ready, with the help of other than the known requirements can be met ( so-called competence trap).

This leads to the important question is how a legally Direction as unfavorable path can be left again. In general, it requires a sufficiently large shock to the chosen path to open a new crossing point. This vibration can have different causes. Competition and learning effects play mainly a role in the economy, while in the policy that is contrary processes can interfere with paths and revise sustainable developments. Vibrations can also be triggered by external causes, such as natural disasters or the collapse of a government.

Competition

Industry standards are often irrelevant by the introduction of a new superior technology, as in the case of the replacement of videotapes by DVDs. For sites can form new centers that will challenge the old and eventually peel off in the competition.

Learning effects

Learning effects often play a major role in the correction of paths. For example, CFCs were banned by the Montreal Protocol in 1987 in many countries after its negative impact on the ozone layer of the earth's atmosphere had become known. So that a new crossing point for development of cooling chemicals was set in the industry. Also, the switching to renewable energy is today by learning effects due to new findings about the effect klimaerwärmende fossil fuels.

Opposing processes

In contrast, competition institutions and learning effects are small. Here it often takes opposing processes to more far -reaching reforms. With opposing processes temporally concurrent developments outside the institutions are meant to set the path-dependent development of institutional obstacles in the way. It could mean, for example to a gradually growing popular discontent, which dams up and finally unloads when a certain threshold is exceeded, for example, when unemployment exceeds a certain percentage.

Supplements

Of path-dependent developments also occur in everyday life. For example, is spoken among people from the career or the career path. This way of speaking is based on combining the intuitive recognition of the path dependency of this area of human development, on the other hand, the desire to have mapped out a clear perspective on entry into the profession.

In the natural sciences it is difficult to find examples of path dependence. An example at least the ball is on the mountain, the many ways has to roll down before he was losgestoßen, but is largely determined after the start of a route. In mathematics the Pólya - urn experiment modeled a path-dependent process. The experiment begins with an urn in which two balls are of different colors. One pulls in each step a random ball from the urn and throws the drawn together with a new ball of the same color back into the urn back ( self-reinforcement ). The distribution of the balls on the two colors is typical, influenced only by the first drawings as path-dependent processes.