The Proliferation of Specialist Organizations in the American Wine Industry, 1941-1990

Abstract

The research reported here was supported by the University of Michigan Business School. I thank Glenn Carroll, Mike Hout, and Trond Petersen for their advice on my dissertation research. Comments on earlier versions of this paper by Bill Barnett, Joel Baum, Jacques Delacroix, Jane Dutton, Heather Haveman, Will Mitchell, Christine Oliver, Linda Pike, and three anonymous reviewers were invaluable. Please address all correspondence to Anand Swaminathan, University of Michigan Business School, Ann Arbor, Ml 48109-1234. To account for the proliferation of specialist organizations as industries mature, this paper examines the relative importance of four processes-density dependence in founding rates, niche formation through changes in consumer preferences, resource partitioning, and direct institutional support-to explain the level and dispersion in foundings of specialist organizations. Analyses of the founding rate of specialist organizations, farm wineries, over 1941-1990 reveal that state-level farm winery density has the strongest impact on both the level and dispersion of farm winery foundings. Density effects are followed by the effects of resource partitioning, institutional support, and niche formation, in order of level of importance, and by the effects of niche formation, institutional support, and resource partitioning, in order of the importance to dispersion. The results suggest that factors such as density dependence and resource partitioning that are endogenous to a specific population need to be considered in combination with factors such as niche formation and changes in the institutional environment that are exogenous to the population to account adequately for the proliferation of specialist organizations.