Functional differentiation of society as a middle-range theory

Abstract

PurposeThis paper aimed to analyze the ways in which Niklas Luhmann's theory of the functional differentiation of society can be applied to historical studies. To achieve this, a semantic analysis of the development of modern insurance in Germany during the nineteenth century was conducted.Design/methodology/approachThrough an examination of the significant features of Luhmann's theoretical frameworks in empirical objects, Luhmann's semantic analysis was reformulated as an approach based on a middle-range theory, similar to that of Robert K. Merton, where the potential of the theory can be maximized for empirical research. This paper embodies this proposal, citing several developments within organizations that imbued insurance technology with various ideas and values.FindingsThe theory of the functional differentiation of society can be reconstructed as a working hypothesis from a methodological perspective, instead of a general theory that explains every part of society. Applying this to empirical social practices leads to progress in historical studies conducting the semantic variations connected to the institutional formation and their boundary works.Originality/valueThis paper provides a practical research perspective for historical studies in the social sciences, employing a reinterpretation of sociological theory that may be understood only as a structural presupposition of modern society. Furthermore, the increased possibility of historical-comparative studies on modern insurance is indicated by illustrating the applicability of this framework to a detailed case study of modern insurance.