The dynamics of inertia: Institutional persistence and institutional change in telecommunications and health care

There is a tendency in the new institutionalist literature to equate institutional inertia with stasis and no-change. Using case studies from the international telecommunications regime and the German health care system, the paper tries to show that this equation is wrong. Inertia does not necessarily prevent institutional change. It can interfere with the replacement of old institutions, but it is compatible with other forms of institutional transformation. Inert structures can be patched up with new structures or transposed to new functions. The paper analyzes patching up and transposition as distinct modes of institutional change and assesses their potential for adapting institutional arrangements to new environmental conditions. It concludes that inertia should not be contrasted with institutional change per se because inertia allows for and may even be a prerequisite of change.