The institutional evolution process of the global solar industry: The role of public and private actors in creating institutional shifts

- We investigate the influence of institutional entrepreneurs in the evolution of the global solar industry.
- We distinguish between the specific role of companies and governments in the industry creation process.
- We focus on the industry's institutional evolution process and propose the concept of institutional shift.
- The empirical findings suggest a knowledge-based and a stimuli-based mechanism of institutional shifts.

This study takes an institutional perspective on industry creation, which argues that an industry's maturation relies on a process of building legitimacy and establishing rules for competition. It addresses the institutional evolution process that an industry experiences, in which existing rules for competition are disrupted and replaced by new regulatory frameworks, technological standards, and business models. These interruptions are referred to as institutional shifts. The study seeks to understand the role of specific actors in creating institutional shifts that drive an industry's institutional evolution process. Based on a study of the global solar industry over the period of 1982-2012, the findings suggest that the industry's institutional evolution was driven by an interplay of different public and private actors that influenced one another over time and across national borders. To create institutional shifts, companies employed a mechanism based on knowledge diffusion, while governments used a stimuli-based mechanism instead.