Structure, Content and Meaning of Organizational Networks by Groenewegen Peter;Ferguson Julie E.;Moser Christine;Mohr John;Borgatti Stephen P.;

Author:Groenewegen, Peter;Ferguson, Julie E.;Moser, Christine;Mohr, John;Borgatti, Stephen P.;
Language: eng
Format: epub
Publisher: Emerald Publishing Limited
Published: 2017-09-25T00:00:00+00:00

Semantic Networks and Price Formation

Price is one of the key variables in economics. It is traditionally viewed as the outcome of supply and demand. However, sociologists have suggested that it may also be formed through social relations and influence. Uzzi and Lancaster (2004), for example, look at how the pricing of legal services in the United States is influenced by embedded ties, board overlap ties, and status ties (albeit in different ways). They argue that network ties impact prices “by adding unique value to exchanges” (2004, p. 320), and that this comes from private information flows and informal governance mechanisms. In semantic networks, however, mechanisms are likely to be different since the nodes are not people; they are concepts with no agency and do not participate in information flows and governance mechanisms. So the question is what mechanisms are specific to attributed and intended semantic networks in their impact on price?

More concretely, starting with attributed semantic networks, each market is represented by the media through descriptive articles and opinion pieces. For example, fashion magazines such as Vogue, Vanity Fair or Elle constitute the written expression of what journalists and media organizations think about the fashion industry and its various stakeholders (Moeran, 2006). The media thus collectively function as information disseminators, tastemakers, and gatekeepers for the diffusion of products and services (Hirsch, 1972, 2000). From this collective media effort a corpus of text is generated in which organizations are represented through words, and connected to other words through meaningful arguments. Through the semantic network thus created, the media form a collective opinion that positions competing organizations vis-à-vis each other and the industry as a whole by associating specific words with them.

One could argue that studying the words with which an organization is associated in the media is akin to looking at the number of market categories to which it belongs; there is a rich sociological literature on evaluation that found that the higher the number of categories, the more the organization is penalized by audiences (Hsu, Koçak, & Hannan, 2009; Zuckerman, 1999; Zuckerman, Kim, Ukanwa, & von Rittman, 2003). However, words in media texts do not always represent market categories. They have other purposes such as expressing emotional reactions to a firm’s products, reacting to its culture and values, or even describing its corporate history. In this sense, attributed semantic networks capture more than just the range of market categories to which an organization belongs.

Furthermore, one of the key strengths of a structural approach to culture is that it offers compelling measures that go beyond a simple count of the number of words linked to an organization. For example, betweenness – i.e., the extent to which a node is on the shortest path between all other nodes in the network (Freeman, 1978) – could help tackle the complex semantic structure of markets (Corman, Kuhn, McPhee, & Dooley, 2002; Wherry, 2012). In social network analysis, betweenness is often used to represent the control that a given node exerts over information flows (Freeman,

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