Searching for a new perspective on institutional voids, networks and the internationalisation of SMEs in emerging economies: a systematic literature review

Abstract

PurposeThis study, a systematic review, focuses on the internationalisation of small and medium-sized enterprises (SMEs) originating in developing countries. It critically analyses, evaluates and synthesises studies featuring formal and informal institutions, embedded in social and business networks, as a marketing solution for institutional voids. The review shows that current international marketing studies downplay the role of informal institutions in the internationalisation of SMEs. Thus, the authors set a new research agenda for advancing the institutional theory to account for the impact of informal institutions and networks on firm internationalisation.Design/methodology/approachThis review followed five structured stages, including framing the research questions, identifying relevant studies, assessing their quality, summarising the evidence and interpreting the findings. Based on the systematic approach, 434 papers (374 from Web of Science, 60 from Scopus) were generated. Following that, the authors applied the qualitative inclusion/exclusion criteria, which yielded 63 papers. Their analysis involved three authors, with the fourth author focusing on ensuring quality in the analysis.FindingsThe study findings invite a different line of theorising market structures and processes focusing on the role of networks as an alternative to formal institutional systems. The outcome of our review suggests that there is scope for developing the institutional theory that account for the role of informal institutions and networks.Originality/valueBased on the analysis, we call for new theorisation, in the international marketing literature, which accounts for informal networking amongst internationalising SMEs in the light of institutional voids. Thus, the authors promote novel participatory, bottom to top understanding of relationship between institutions and enterprises.

The effect of government support on Bureaucracy, COVID-19 resilience and export intensity: Evidence from North Africa

“…Mainly, contingency theory holds that firms’ optimal performance is dependent on various internal and external constraints ( Wiengarten et al, 2013 ). In this vein, when examining the bureaucracy of accessing government support, scholars have typically espoused institutional void theory ( Chakrabarty and Bass, 2013 , Puffer et al, 2016 , Dekel-Dachs et al, 2021 ). Especially in emerging markets, inherent institutional voids distance firms from government assistance ( Palepu and Khanna, 1998 ), as the ease with which they [firms] can access available support is encumbered.…”

Trusting in indigenous institutions: exporting SMEs in Nigeria

“…Research on SMEs in emerging and developing economies has continued to gain significant interest amongst entrepreneurship scholars (see for example: Dana et al, 2018;Krasniqi and Desai, 2016;Muralidharan and Pathak, 2017;Simba et al, 2020). Such intensive focus has enhanced understanding on entrepreneurial activity in contexts where formalised institutions have become dormant (Dekel-Dachs et al, 2021). The vast majority of existing studies that have emerged in the past two decades have been particularly focussed on SMEs geographically located in advanced economies (see for example: Lu and Beamish, 2001;Child and Rodrigues, 2007;Stoian et al, 2016).…”

“…Dana et al, 2018;Krasniqi and Desai, 2016;Muralidharan and Pathak, 2017;Simba et al, 2020). Such intensive focus has enhanced understanding on entrepreneurial activity in contexts where formalised institutions have become dormant (Dekel-Dachs et al, 2021).…”

Smes Internationalization: Between Strategic Collaborators and Intermediaries

“…Another strategy applied by SMEs in their process of venturing into foreign countries and markets is linked to the usage of intermediaries. These intermediaries can pave the way for the expansion process by connecting buyers with sellers and they are also in charge of looking for potential buyers/sellers, negotiating terms of trade and importing/exporting the good to the end user (Dekel-Sachs et al, 2021). In this sense, a study carried out by Małys and Fonfara (2019) on Polish food companies pointed to the importance of developing a strong relationship with one actor, who acted as key intermediary with the market versus developing a number of weaker links with various actors.…”