PhD Research Proposal Presentation: Jack Sadek
Mr. Jack Sadek, a doctoral student at McGill University in the area of Strategy & Organization will be presenting his research proposal entitled:
OUT OF THE SHADOWS: CATEGORY EMERGENCE IN THE INFORMAL ECONOMY
Wednesday, May 15, 2024 at 10:00am – 12:30pm
(The presentation will be conducted in hybrid mode)
Student Committee Chair: Professor Robert Nason
Please note that the presentation will be conducted in hybrid mode and only the student and committee members may participate.
ABSTRACT:
A growing body of literature has made progress in understanding new market categories. However, the literature, as most literature in management, has focused on categories that emerge from the formal economy where legitimacy and legality are closely intertwined. The informal economy is shaped and deemed legitimate based on informal institutions while illegal based on formal institutions. Many categories do emerge from the informal economy such as the streaming music and cannabis industries. Unfortunately, we know little about the process and consequences of informal category emergence.
This dissertation seeks to address this central issue through two studies of the cryptocurrency category. Cryptocurrencies, a new form of internet money, originated from the cypherpunk social movement in the dark web with an original use case tied to illegal activity such as drug trade and murder for hire. Despite this stigmatization and informal economy origins, cryptocurrency has grown into a $2 trillion market with widespread adoption by retail investors, financial institutions, and governments. My empirical analysis traces and deconstructs this unique category’s trajectory, using it to not only extend the phenomenological scope of category emergence study but also to scrutinize underlying assumptions in the literature and build new theory. Practically, the dissertation is structured into three chapters – one brief “table setting” conceptual chapter and two distinct in-depth empirical investigations.
The first chapter of my dissertation provides an overview of the theoretical and empirical setting. I first expand on what we know regarding category formation and how it has mainly focused on categories emerging from the formal economy. I contend that examining categories in the context of the informal economy can be a fruitful avenue to expand our theoretical understanding. Furthermore, I combine literature on stigma, with the informal economy to provide a more nuanced differentiation between the formal and informal economy. This approach examines category emergence by analyzing the informal economy, motivating theoretically generative avenues to pursue.
The second chapter takes a macro-perspective and focuses on the transition of cryptocurrencies from the informal to the formal economy. I focus on the role of regulators who have been identified as influential actors but largely ignored. I propose an archival study to examine the narratives created by regulatory agencies in the United States. I am in the process of sampling from over four thousand press releases, public statements, and rulings from the U.S. Congress and government enforcement agencies. Taking a narrative analysis approach, I will use a combination of topic modeling and inductive qualitative methods, to track the evolution of the narrative surrounding cryptocurrencies. The third chapter focuses on internal category dynamics and challenges a dominant assumption that a collective identity is needed to legitimize the category. The emergent cryptocurrency category challenges this as it is characterized by intense infighting. I use this novel context to explore how the category’s identity is shaped by three of the most notable cryptocurrencies Bitcoin, Ethereum, and XRP. To examine this, I use a unique data set of over one million tweets from 58 subject positions, individuals across the communities who have a legitimate voice and shape the discourse. I find that while the category beacon uses a Discourse of Protection to create a prototypical category identity, challengers use a Discourse of Inclusion resulting in a goal-directed category identity. My dissertation aims to elucidate category emergence from the informal economy, the role of regulators, and challenges taken for granted assumptions about collective identity.
