How regulation and globalization affected organizational legitimation and competition among commercial banks

Organizational theorists now widely recognize that both institutions and competition play major roles in the evolution of industries and organizational populations. A central research question facing the field concerns how these two phenomena affect each other. Theorists often argue for the primacy of one or the other set of factors and empirical researchers often treat one set as fully exogenous while studying the other. Yet, in most general theoretical analyses, both institutions and competition are regarded as endogenous to long-term organizational evolution. This possibility raises great theoretical and modeling difficulties that require more attention by organizations researchers. We address these issues here by studying the banking industry in Singapore—an ideal research context because of the development of strong regulations and the presence of diverse international competitors. Historical development of the industry is characterized by the appearance and prevalence of different organizational forms of banks, from early trade-facilitating foreign banks to local Chinese banks to multinational banking corporations. Banking regulations in Singapore are enacted and put into place a