Platform innovations like Uber and Airbnb allow peers to transact outside established market institutions. From an institutional perspective, platform companies follow a reverse innovation process compared to innovation within traditional regulatory systems: they first launch their online platform and ask for government permission only later. We analyze the emergence of Uber as an institutional entrepreneur in The Netherlands and the strategies it employed in a failed attempt to get its UberPop service legalized through changes in Dutch taxi law. We conclude that Uber’s failure to change the Dutch taxi law stemmed from the difficulty to leverage pragmatic legitimacy among users into favorable regulatory changes in a highly institutionalized regime, because Uber’s institutional work strategies were not aligned.
Keywords: Platform economy | Uber | Ridesourcing | Institutional change | Legitimacy | Regulation

In 2007 the Securities and Exchange Commission (SEC) made an historic ruling allowing foreign regis- trants to file IFRS-based financial statements without reconciling to U.S. GAAP. With that decision, the SEC changed its longstanding practice of adhering to a single set of accounting standards in the U.S. The decision diminishes the standing of two previously powerful institutions: U.S. GAAP and the SEC itself. We examine this important change drawing generally on institutional theory. We draw on several models to obtain insights into the likely roles of both regulator and regulatees, into the reasons the particular type of incremental change mechanism was observed, and into the influence of powerful transnational organizations on both the fact of change and timing of change. The key contribution of the article is to explicate incremental institutional change by examining specific mechanisms of change given the multi-level dynamic of accounting regulation. First, the interplay between national and transnational players and their coalitions shape what becomes an acceptable change mechanism. Second, layering mechanism, where new rules are attached to existing ones, is typically expected to destabilize existing institutions but can also decrease the push for broader change by layering regulation only for a particular segment. Finally, strategies employed by transnational accounting firms to stifle or promote institutional change are of interest. We focus specifically on their role in solidifying a transnational coalition of challengers to U.S. GAAP and therefore of apparently effecting the timing of the change. Documentary empirical data were drawn from the comment letters provided to the SEC in response to the proposed change, as well as from the SECs final ruling document and from related releases. We analyze formal comment letters issued in response to the proposed 2007 rule, compare those to expectations based on theory and in some cases to prior public positions taken. We interpret our findings against the backdrop of meta level shifts in regulatory loci toward privatization and transnationalization of standard setting.© 2015 Elsevier Ltd. All rights reserved.
Keywords: Institutional theory | Institutional change | Layering | IFRS | Transnational regulation