A common belief across several streams of organizational research is that organizations typically conform to consumer-held expectations regarding their behavior. As a result, researchers often attribute instances of organizational nonconformity to shifts in consumer expectations. Acknowledging that many markets are best characterized as brokered markets whereby consumers and producers come together via a third party, this article explores an alternative, relational mechanism that can account for rapid market changes that occur in defiance of consumer expectations. In short, we suggest that consumer expectations may be applied differentially as a function of the way they travel through the market. We refer to this phenomenon as institutional interruption, and define it as the process whereby existing modes of institutional reproduction are temporarily disturbed via alterations to a market’s relational structure. Central to the proposed framework is a distinction between two styles of network brokerage: transmission and transformation. Both modes contribute to markets by moving tangible resources, such as goods and capital, from one party to the other. Where they differ is in their capacity to actively transform or block the diffusion of various intangible things—here being consumer expectations—upon which markets are constructed. In an empirical section, we apply the transmission–transformation distinction to help explain growth and decline in product heterogeneity in the global hedge fund industry from 1994 to the present.
