Institutional complexity and SME strategies: a Western Balkans perspective

This article examines the institutional complexity shaping SME strategies in the Western Balkans. Considering SMEs' pivotal role in transition economies demands a clearer understanding of institutional complexity. Employing an institutional theory perspective and an inductive grounded theory method, we unveil the significance of institutional voids and asymmetries in complex institutional settings. We demonstrate the influence of the EU integration process in moving from institutional voids to institutional asymmetries. Additionally, two opposing institutional logics emerge as dominant in the Western Balkans, adding to institutional complexity. We can affirm that institutional complexity propels an escape-type internationalisation as the main SME strategy. With this research we entangle the institutional complexity in transition economies and contribute valuable insights for policymakers, emphasising the need for targeted policies amid ongoing transition processes.