The role of institutions in the internationalization of Sub-Saharan Africa SMEs into developed markets : A case of Kenyan SMEs

Internationalization of SMEs from emerging markets into developed markets is a phenomenon that requires more research given the abundance of research and theories to explain multinationals internationalization. Particularly firms from the global South have been under researched in international business literature. Therefore, the purpose of the study is to explore the role of institutions in the internationalization of sub-Saharan Africa SMEs into developed markets. The study is based on the 3-pillar institutional framework and the institutional escape and foster theories. The study uses a qualitative case study design to gather insights from Kenyan SMEs that have internationalized into the European market. Crosscase synthesis is used as an analytical technique. The findings reveal that home institutions (regulatory, normative and cultural-cognitive) have a constraining role on internationalization based on the perspective of the SME owners. The host regulatory institutions have a dual role on sub-Saharan Africa SME internationalization. Normative and cultural-cognitive host institutions have a constraining role when the institutional distance is large and a supporting role when there is a smaller institutional distance.