Institutional Change in Large Law Firms: A Resource Dependency and Institutional Perspective

Abstract

We integrate resource dependency and institutional theory to argue that resource scarcity drives, and legitimacy enables, institutional change. Building on a historical account, we examine the sources and timing of innovation departing from standard human resource practices using event history analysis of over 200 principal offices of large law firms. Offices with human resource scarcity innovated to acquire alternative resources; highly prestigious offices had the legitimacy to be first or early adopters. Our findings highlight the value of looking to the resource side and to the notion of legitimacy in building an institutional theory of change.