Network for
Actor-Reality
Construction

- A Pragmatic Constructivist Approach to Management and Accounting

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This network addresses the development of theories, methods and experiences around pragmatic constructivism. The pragmatic constructivist theory takes as its point of departure the question, ‘Under what conditions do activities function and lead to success in a social context?’ Businesses do not function by themselves due to mechanical or natural laws; business processes do not relate or run by making a decision and pressing a button. Rather, the operating causalities must be constructed in an effective, non-fictional way. The research on pragmatic constructivism emphasises the role of the actor - as controller, manager, entrepreneur, or agent etc. - in the construction of organized reality. Reality is considered as the relationship between the (individual and collective) actors and the world in which they operates. These relations are not given by nature, they are constructed; and the construction may function successfully or it may be hampered by fictive and illusionary elements, due to missing or faulty actor-world relations.

In more concrete terms, pragmatic constructivism is based on the thesis that four dimensions of reality must be integrated in the actor-world relation if the construct is to be successful as a basis for effective actions. These four dimensions address, simply speaking, the facts, possibilities, values and communication. The argument for the inclusion of these four dimensions and the relationships among them is as follows. Facts are necessary as a basis of action. However, facts are necessary but not sufficient conditions. If there are no possibilities, there can be no action. The only human state without possibilities is death. The possibilities must be factual, i.e. they must be grounded in the facts at hand. Otherwise they are imaginary to the actor. Further, possibilities create room for choice, but they only function if there is a reason to choose and prefer one possibility rather than the other, i.e. if the actor has values and the values lie within the range of one’s possibilities. Finally, the integration of facts, possibilities and values must be expressed in communication in order to enable action in a social setting coordinating a social division of labor. Thus, if the actor's values are within the range of her factual possibilities, then the actor will act and succeed. If, on the other hand, the integration of facts, possibilities, values and communication is incomplete or dissolves, then the ability to act effectively weakens because the very distinction between pragmatically true and false, i.e. between successful and unsuccessful action, breaks down.

Pragmatic constructivism offers a schema outlining sufficient conditions for creating effective “construct causality”. Construct causality means that for endeavors to be fulfilled, i.e. causally affect the desired outcome, there must be an integration of four dimensions involved in the endeavor. Accordingly, looking for the conditions for construct causality directly calls for a pragmatic constructivist perspective because its theory of integration specifically addresses the question of conditions for successfully functioning practice. As businesses, societies and human lives are based on ‘construct causality’, the clarification of conditions for construct causality is a necessary field for further research. Further, to develop, control, and account for construct causality appropriate methods need to be developed and analyzed.

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New book: A Philosophy of Management Accounting

A group of researchers at the Department of Management have made contributions to a book on pragmatic constructivism. The book is recently published by Routledge:

 

 

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