Edelman, Lauren, Christopher Uggen, and Howard Erlanger. 1999. “The Endogeneity of Legal Regulation: Grievance Procedures as Rational Myth.” American Journal of Sociology 105:406-54.
Most accounts of organizational response to law treat law as largely exogenous, and emphasize organizations' response to law. We propose a model of endogeneity between organizations, the professions, and legal institutions. We suggest that organizations and the professions strive to construct rational responses to law, enabled by "rational myths" or stories about appropriate solutions that are themselves modeled after the public legal order. Courts, in turn, recognize and legitimate organizational structures that mimic the legal form, thus conferring legal and market benefits upon organizational structures that began as gestures of compliance. Thus market rationality can follow from rationalized myths: the professions promote a particular compliance strategy, organizations adopt this strategy to reduce costs and symbolize compliance, and courts adjust judicial constructions of fairness to include these emerging organizational practices. To illustrate this model, we present a case study of equal employment opportunity (EEO) grievance procedures.