Strategic Reactions of Organizations to Legal Environment: A Typology for Industries in the Process of Institutionalization
Erdem Kirkbesoglu

Abstract
The aim of this study is to construct a typology which indicates strategic reaction of organizations against legal environment during the historical development of insurance industry which cannot complete the process of institutionalization in Turkey. In this study, institutional and resource dependence perspectives are used to the prediction of strategic reactions to institutional processes. The study offers a typology of strategic reactions that varyin active organizational defiance from passive deference to proactive manipulation. The theoretical typology constructed at the end of the study exhibits the transition from stationary legal environment to dynamic legal environment for insurance industry. In this transition period, insurance companies have tended to isomorphic inclination with this laws and related organizational applications. On the other hand, three testable propositions are reproduced for future studies from three stages of institutional process to contribute approaches and models of strategic management. The article proceeds in the following manner. First, we briefly review the literature regarding legal environment and strategic reactions of organizations to legal environment. Organization theories such as institutional theory and resource dependence theory form the basis of this study. Second, we analyze role of legal environment in the historical process of insurance industry in Turkey. We scan many historical documents, laws, regulations and politic applications. Next, we produce typology for industries in the process of institutionalization and testable propositions for future studies. Finally, we provide the research findings and discuss their organizational and theoretical implications.

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