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In their well-known contribution to the “varieties of capitalism” debate, Peter Hall and David Soskice (2001, Ch. 1) highlight the distinction between a “coordinated market economy” as exemplified by Germany and a “liberal market economy” as exemplified by the United States. Under the heading, “Liberal Market Economies: The American Case”, Hall and Soskice (2001, p. 27), argue:Liberal market economies can secure levels of overall economic performance as high as those of coordinated market economies, but they do so quite differently. In LMEs, firms rely more heavily on market relations to resolve the coordination problems that firms in CMEs address more often via forms of non-market coordination that entail collaboration and strategic interaction. In each of the major spheres of firm endeavor, competitive markets are more robust and there is less institutional support for non-market forms of coordination.

Purpose – This essay attempts to answer the question, “What distinguishes inter-human influence from other forms of influence?”

Design/methodology/approach – Specifying the micro-foundations of social structures in terms of communicative inferences necessitates a revision of the concept of social structures (and institutions) as distributed, and hence, uncertain, structures of expectation. Institutional realities are generated in linguistic interaction through the indirect communication of generic references. The generalizing function of language – in particular, abstraction and memory – coupled with its reflexive function, to turn references into things, are sufficient to generate both social structures and institutions as collective inferences.

Findings – Social relations are fundamentally communicative relations. The communicative relation is triadic, implying an enunciator, an audience, and some referential content. Through linguistic communication, humans are capable of communicating locally with others about others nonlocally. Institutions exist only as expectations concerning the expectations of others. These expectations, however, are not only in the mind, and they are not exclusively psychological entities. Linguistically, these expectations appear as the reported statement within the reporting statement, that is, they are constituted through indirect discourse.

Research limitations/implications – An important implication for current sociological theory is that, from the point of view of a sociology defined as communication about communication from within communication, institutional realities should not be reified as existing naturalistically or objectively above or behind the communications through which they are instantiated.

Originality value – This approach, then, is decidedly anti-“realist.” The goal of such research is to examine the inadequacy of nonreflexive models of social order. Accounts of how sets of social relationships emerge will remain inadequate if they do not reflect upon the cognitive and communicative processes which make possible the consideration of such structures.

The paper provides an empirical analysis of the development of and perspectives on industrial relations (IR) in Germany. The first part deals with forms and degrees of institutionalization, which can be used as measures of the maturity and the potential impact of an academic discipline: IR within universities and research institutes, the professional organization, journals, and textbooks. More recent developments are more in line with those in other continental European states than with Anglo-Saxon countries. The weak, slowly progressing degree of institutionalization leads to the conclusion that IR does not constitute a unitary academic discipline. Nevertheless, research and scholarly interest exist. The second part surveys the structure of scholarly research and disciplinary participation. The German case reveals both common and divergent features compared to other countries. An obvious feature of IR is its disciplinary rather than holistic and interdisciplinary character. Empirical research has been less quantitative, and in more recent times less econometrically oriented than in some other countries. Human resource management's (HRM) institutional as well as personal ties with IR are weak and interdisciplinary debates are rare. Another distinctive feature is the large significance of labor law whose study also follows the strict departmentalization of the university structure in Germany. Empirical research in law is still rare and has definitely no solid position within law schools. On the other hand, industrial sociology has had a substantial impact on IR research for several decades and has covered various parts of IR territory. The third part discusses research topics. For quite some time, trade unions and collective bargaining have been the dominant topic. More recently, the focus of interest has shifted from the meso (sectoral or branch) to the micro (enterprise or shop floor) level. Various forms of codetermination, the institutionalized forms of participation in managerial decision-making, have constituted the other traditional research subject. Throughout the 1990s, the process of German unification constituted a “critical juncture” for IR and was an unexpected new topic. More recently, this kind of “unification research” has come to a natural end. Since the early 1990s, there has been a remarkable increase in scholarly work on IR issues concerning employment regulation and governance within the European Union. Last but not least, some traditionally ignored topics are discussed. Numerous labor market-related issues have been of very limited interest for the core of the IR community. Interest in types of atypical or non-standard employment has remained limited. The same limited attention is true for IR in the expanding non-union sector. Another neglected topic is labor relations in the public sector. The outlook discusses future trajectories of IR research. It is argued that the prospects will be encouraging if younger scholars manage to develop a broader, more integrative definition of the field (e.g., “regulation of all aspects of the employment relationship”).