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Organizations and Local Development: Economic and Demographic Growth among Southern Counties during Reconstruction

Under conditions of uncertainty, we predict that development will be tied to the idiosyncrasy of organizational forms represented within local regions. Our investigation applies this theory to data on 342 counties and 43,352 businesses in the U.S. South during Reconstruction, finding support for the thesis that organizational idiosyncrasy generally dampens growth and challenges taken-for-granted norms of community structure. The causal effect varies somewhat depending on whether the underlying mechanisms entail increases in the production of local goods, the accumulation of fixed capital, or the attraction of new residents and retention of existing ones. We conclude by considering if the theory may generalize to other settings, including locales that depart markedly from the close-knit agrarian culture of the postbellum South.