Abstract:

What are the conditions under which business corporations expand their institutional power? This paper argues that institutional power is affected by the architecture of the “acquisition regime” – the set of formal (and informal) rules that govern how states purchase public services. A shift towards marketization in this regime leads to micro-level policy feedback effects that contribute to the accumulation of institutional power among large business corporations. We illustrate this through process tracing the change in the acquisition regime of social services in Israel in the 2010s, relying on multiple data sources and analysis, including interviews, public procurement data, policy documents and corporate reports. We argue that the alignment of market-based approach and practices in social services acquisition with business corporations' capitalist, expansionary logic and competitive experience contributed to their empowerment in a changing institutional environment. Additionally, the increasing embeddedness of corporations in state service provision enabled them to reshape further procurement rules to their advantage. Our work contributes to the conceptualization and theory on institutional power.