Subjective Rationality, Self-Confirming Equilibrium, and Corporate Strategy
Management Science
Social Reality, the Boundaries of Self-Fulfilling Prophecy, and Economics
Organization Science
When Truces Collapse: A Longitudinal Study of Price-Adjustment Routines
Organization Science
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Theories matter because they affect behavior and can, under certain circumstances, become self-fulfilling. For a theory to become self-fulfilling, people must be aware of the theory and have the ability to make choices according to its dictates, social and physical arrangements are altered on the basis of the theory's prescriptions, and the proponents have the power to implement social arrangements consistent with the theory. Economics and other social science theories often fulfill these conditions, with implications not only for the work of scholars, but also for how we think about testing theories that can change the world they describe.