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U.S. federal policy has created, at best, a gap and, at worst, a hostile environment for nonprofits serving refugees. We rely on frameworks of nonprofit-government relationships (institutional voids, structural holes, instrumental/expressive support) to explore government-nonprofit interactions in the refugee domain, and their impact on 34 refugee-serving nonprofits in the U.S. Findings indicate limited expressive and instrumental support for nonprofits and suggest nonprofits must navigate complex, multilevel, environments. Contributions include the suggestion of “intentional” rather than institutional voids, and a new typology of forms (zero, unclaimed, symbolic, or comprehensive) of government support for nonprofits in a problem domain based on whether government’s instrumental and expressive support for nonprofits is high or low. [ABSTRACT FROM AUTHOR]

International social alliances—in which multinational enterprises (MNEs) and social enterprises (SEs) collaborate—are a vital source for the development and scaling up social innovations for value creation. Yet, these alliances face significant legitimacy challenges, which are more glaring in bottom-of-the-pyramid markets (BOPMs) within emerging and developing economies owing to weak and underdeveloped formal institutions. Drawing on the legitimacy, institutional, and social alliances literature, we develop a conceptual framework that explains the importance of developing social, institutional, and commercial legitimacy in international social alliances operating in BOPMs. We also explored the challenges faced by international social alliances in BOPMs and the factors that enable MNEs and SEs to build different types of legitimacy. We contribute to international business research by providing an understanding of various legitimacy building strategies enacted by international social alliances based in BOPMs for social value creation. [ABSTRACT FROM AUTHOR]

Recent studies suggest an ecosystem view is most appropriate for understanding the impact of institutional voids on entrepreneurial activities. Expanding the focus to the entrepreneurial ecosystem is crucial for tackling complex low‐ and middle‐income countries' (LMICs) environmental challenges, as the transition to circular e‐waste management, which are heavily impacted by the institutional environment. Moreover, most entrepreneurs in LMICs engage in circular practices out of economic necessity, rather than environmental reasons. However, scholars have overlooked the effects of institutional voids on entrepreneurial ecosystems' potential to grow and realize environmental benefits. This study investigates how formal institutional voids impact the evolution of circular ecosystems in necessity‐driven contexts in LMICs. We study the evolution of a circular e‐waste ecosystem in Kenya and uncover two key phases: emergence and growth. We show that formal institutional voids' impact differs across phases; regulatory and contract enforcement voids create opportunities for informal and private actors to establish e‐waste collection, repair, remanufacture, and recycle businesses, thereby facilitating the emergence of the circular ecosystem. However, labor market, capital market, product market, regulatory, and contract enforcement voids hamper its growth. Specifically, the lack of skills, equipment, guidelines, and financial incentives hinders advanced repairs and remanufactures and limits recycling opportunities, while the lack of formal e‐waste infrastructure increases illegal dumping and negatively impacts human health and the environment. We develop propositions and a phase model to explain the impact of formal institutional voids on the evolution of circular e‐waste ecosystems and the realization of environmental benefits in necessity‐driven contexts. [ABSTRACT FROM AUTHOR]

The literature on institutional voids examines how intermediaries, such as business groups and business incubators, address such voids in emerging economies. However, it remains unclear whether and how digital multisided platforms fill these voids given their unique features. This study focuses on mobile money platforms, which allow users without bank accounts or credit cards to perform financial transactions. We propose that these platforms fill institutional voids in three ways by (i) enabling data-based certification, (ii) providing unified access to distributed services, and (iii) scaling through network effects to reach previously excluded market participants. We argue that these novel mechanisms enable mobile money platforms to expand credit access to end users from formal financial institutions and thereby act as stepping stones to financial inclusion. Our analysis is based on a difference-in-difference design that leverages regulatory changes that allowed nonbanks to operate as mobile money operators and data from a representative random sample of 151,771 individuals in 78 countries. We supplement our quantitative analysis with rich, hand-collected qualitative evidence to illustrate the mechanisms underlying our findings. Funding: Financial support from the Wharton School of the University of Pennsylvania. Supplemental Material: The online appendix is available at https://doi.org/10.1287/orsc.2022.16562. [ABSTRACT FROM AUTHOR]

The possibility that small and medium-sized enterprises (SMEs) mix and match prediction and non-prediction while making decisions during internationalization remains a highly unaddressed scenario. The rare studies considering it do not go beyond domestic effects when contextualizing the decisions that guide SMEs' foreign expansion. This study links SMEs' decision-making strategies to performance and suggests that such a relationship is moderated by the host market's institutional development and the associated institutional voids. The analysis combines primary survey data from 851 SMEs in Brazil, China, Italy, Poland, and Sweden with secondary data retrieved from the World Bank. Besides supporting both independent and synergistic performance effects of predictive and non-predictive strategies, the results indicate that foreign market institutions affect these effects differently and suggest firm size effects worth consideration. Contributions include the expansion of the debate on the relationship between prediction and non-prediction beyond the either-or reasoning that prevails in existing research and the contextualization of SMEs' decision-making strategies in terms of the institutional dynamics that SMEs encounter abroad. [ABSTRACT FROM AUTHOR]

The discipline of International Entrepreneurship (IE) conceptually rests upon the foundations of entrepreneurship and international business - with theory typically derived from larger corporations and mature markets. Through comparison between IE in emerging and mature contexts, and individual and corporate entrepreneurship, distinctive features of individual IE in emerging markets are identified. A series of case studies conducted in Laos, Cambodia, and Vietnam document how incremental innovation underpins IE; how foreignness helps IEs spot opportunities (unrecognized by locals); how simple bureaucracies (commonly found in emerging markets) invigorate IE; how startups in emerging environments embody assimilation (larger international corporations cannot match) - and how this assimilation (combined with being small and nimble) enables IEs to thrive within ambiguity and institutional voids. Most importantly, this study challenges the applicability of institutional and transaction cost theory to explain market entry modes of individual IEs in emerging markets. Contrary to conventional wisdom, institutional voids were not found to deter these IEs. Rather, these IEs' primary concerns relate to pro-business dispositions among authorities, simple bureaucracies, and uncomplicated investment climates. [ABSTRACT FROM AUTHOR]

While few studies have examined the role of institutional pressures on sustainable business practices, there is a dearth of empirical research regarding the influence of internal organisational characteristics on sustainability implementation in developing countries. This paper examines internal organisational features and how they influence multinational companies (MNCs) operating in a resource‐rich developing country to embrace and embed sustainability into corporate policies and practices. The findings show that the history of past sustainable practices, the level of internationalisation and managerial cognition internally drive MNCs to implement sustainability in their host countries. We discuss that managerial cognition drives MNCs to embrace sustainability in non‐enabling institutional environments based on private morality and perceived ethical obligation. Accordingly, we have proposed a holistic theoretical framework for sustainability implementation based on external drivers, institutional voids and complexity and the moderating role of internal organisational features. [ABSTRACT FROM AUTHOR]

As a response to imbalanced economic development across different regions, this study aims to explore how the Fair Trade nongovernmental organisations (NGOs) promote inclusive growth in areas facing insufficient institutional supports and challenging local conditions in a developing market. Through a 5-year longitudinal case study in the context of small-scale tea supply from rural China, this paper explores and identifies a set of institutional voids blocking economic growth and challenging the realisation of the Fair Trade goals. We systematically describe how the Fair Trade NGOs intervene and integrate with other actors in local supply chains. The results reveal important and complex roles the NGOs play in coping with the institutional voids to stimulate Fair Trade. From an institutional perspective, this paper finds that the Fair Trade NGOs can leverage and shape local institutions through collaboration in market structure building, norm promotion, and cognitive development to achieve inclusive growth. Our findings contribute to the understanding of the crucial roles NGOs may play in Fair Trade, inclusive growth, and poverty alleviation. They offer important and practical guidance for NGOs, small farmers, as well as relevant government agencies in their initiatives to fight poverty and achieve economic equality and inclusive growth. [ABSTRACT FROM AUTHOR]

Formal institutions, for example, regulations, are considered crucial determinants of entrepreneurship, but what enables regulatory change when there is a regulatory void, meaning entrepreneurship clashes with existing regulations? Drawing on public choice theory, we hypothesize that regulatory freedom facilitates the introduction of legislation to fill such voids. We test this hypothesis using unique data documenting the time for ridesharing to become legalized at the state level across the United States following its local (and often illegal) rollout. Results suggest states with greater regulatory freedom passed ridesharing legislation quicker, highlighting an underappreciated way that extant regulatory freedom facilitates the accommodation of entrepreneurship. [ABSTRACT FROM AUTHOR]

Prior research on the relationship between financial resource availability and corporate social responsibility (CSR) has presented contrasting theoretical arguments and evidence. While the relationship has been theorized to be positive in developed countries, it has been argued to be negative in emerging economies due to institutional differences. However, prior theorization in the context of emerging economies has failed to consider the possibility of a non-monotonic relationship between financial resources and CSR. Although due to the high costs of obtaining external finance in emerging economies, firms may choose to prioritize capital retention over engaging in CSR activities when financial resource availability is low, this behavior is likely to change beyond a point when the level of available financial resources has crossed a reasonable threshold. In this paper, we develop this perspective and predict a U-shaped relationship between financial resource availability and CSR in emerging economies. We test and find support for this prediction on a sample of the top 500 listed firms in India. Further, we also predict and find that three dominant ownership structures (i.e., family ownership, business group affiliation, and state ownership) differentially condition this relationship. [ABSTRACT FROM AUTHOR]

This paper examines forced migrants who fled their homeland due to conflict and later returned to undertake entrepreneurial activity. Drawing on qualitative interviews with returnees to Bosnia & Herzegovina and Kosovo, we contribute to the process-oriented view of entrepreneurship by showing how forced migration leads to historical bonds to the homeland which influence resultant entrepreneurial activity. We extend literature on institutional voids by demonstrating that they can be enabling, with formal voids substituted by informal networks. Returnees rely on informal ties due to mistrust of formal ties, and these are strengthened by shared experiences of conflict and lead to activities which satisfy non-monetary gains rather than profit. [ABSTRACT FROM AUTHOR]

The literature on Base of the Pyramid (BoP) strategies emphasizes that creating social value requires collaborative, multi-stakeholder business approaches. However, there is limited understanding of how businesses can successfully coordinate such value creation processes in the developing economies that face significant institutional voids. This study adopts a business model perspective for analyzing social value creation processes that span organizational boundaries. We introduce a novel, theoretically grounded business model framework that helps conceptualize social value by locating the various loci of value creation, and the stakeholders that partake in creating and capturing this value. We subsequently analyze the mechanisms of social value creation in M-Pesa, a renowned boundary-spanning mobile money system that has advanced financial inclusion among tens of millions of users in Kenya. The results show that information and communications technology can help advance social value creation by reducing the cost of coordinating boundary-spanning business models that integrate diverse societal stakeholders. The results further point to uneven distributional outcomes in self-governing social value creation strategies where the focal firm plays a coordinating role. [ABSTRACT FROM AUTHOR]

The lack of consumer engagement with the Circular Economy (CE) hinders the use of recycled materials in products manufactured by the B2B companies (e.g., recycled pet bottles in industrial adhesives). Such an institutional void gives space to the rise of a type of network activity: knowledge brokerage, which is a process of knowledge exchange facilitation. This multiple case study contributes with a practical description of brokerage activities in this context. It investigated how companies could interact with academics through knowledge exchange translated into campaigns to engage most consumers with CE. The network approach, under the knowledge brokerage perspective, was the main theoretical foundation of this work. Findings indicate doubts that prevent companies from developing better green marketing campaigns. Academics could help to fill these gaps. Regarding campaign management, academics could identify the different groups of consumers, the delivery channels, campaign duration, and disclosure days/times that most engage each consumer group. Campaigns require educational materials. Academics could identify the amount of information and the presentation format in printed materials. However, engaging most of the population requires a better use of social media. Academics must investigate the posts that could change each group of people's behaviors (including consumers with a lower educational level and less purchasing power). Companies plan to financially support academics who elucidate these doubts or those who succeed in using social media to induce consumers to review their postures. Such support could increase the research funds for the projects managed by the researchers we have named "academic influencers." [ABSTRACT FROM AUTHOR]

The international management literature has presented inconclusive results about the effect of institutional voids in a host country on entrant firms' resource commitment. With the lens of institutional theory and transaction cost theory, this article examines how institutional voids in an emerging market influence a firm's decision to move resources in that market. Resource commitment in an emerging market is examined in terms of the degree of control of the entry strategy employed. The theory presented argues that as institutional voids in a firm's host country escalate, the firm sets out different priority actions to mitigate behavioral and environmental uncertainties in the host country, that in turn affect the degree of control of its entry modes. By relying on a sample of 90 Italian firms operating in China between 2001 and 2010, the results support the hypothesis that the institutional voids-entry mode degree of control relationship displays an inverted U-shape. [ABSTRACT FROM AUTHOR]

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Purpose: The aim of this study is to explore the responses of Lithuanian exporting small and medium enterprises (SMEs) to institutional voids using the typology of strategic responses to institutional processes of Oliver (1991). Study design/methodology/approach: The qualitative research case study method was selected by implementing semi-structured interviews with directors and founders of Lithuanian exporting manufacturing SMEs to collect the primary data. Findings: Drawing on the semi-structured interviews, the study identified responses of the Lithuanian exporting manufacturing SMEs to institutional voids that portrayed two main strategies: acquiesce and avoidance. Originality/value: The results provide contextual contributions exploring firms' strategic responses to institutional voids, identifying the most fatal institutional voids faced by SMEs within the sector.

The world is facing a large number of interrelated crises that have seriously increased the level of uncertainty and ambiguity in many areas. In 2018, the UN anticipated that the world was careering toward a global water crisis with a 40% shortfall in freshwater resources by 2030 coupled with a rising population. This nascent crisis represents a “connected challenge” for countries: it contains a multitude of causes and consequences, a multitude of actors and interests for which no “one-size-fits-all” solutions are available. The adequate approach to this type of complex—or “wicked”—problems is not to search for technological solutions only, but to consider new forms of governance that make use of complementary institutional logics. Effective governance depends on the extent of alignment with the complexity and the root causes of the issues. This paper applies wicked problem theory to identify the root institutional and governance causes of uncertainty in a developing country like Brazil, which provides insights to (also) identify approaches that could navigate change in less uncertain and ambiguous directions. We distinguish three types of relevant institutional constraints: logics, complementarities, and voids. Based on semi-structured interviews with representatives from Brazil's water and sanitation sector, we delineate institutional constraints precipitated by the plurality of the governance system. We argue why a tripartite partnership approach—as for instance pioneered by Dutch international water projects in the global South—presents a way out of the wicked water and sanitation problems in Brazil.

Entrepreneurs in developing economies try to cope with weak or absent formal institutions—often referred to as "institutional voids"—by relying extensively on intermediary organizations such as business incubators and development organizations or informal institutions such as political, kinship, or family relationships. However, in many African countries, intermediary support is limited and informal institutions are also unreliable, adding risks and costs to doing business and increasing the severity of institutional voids in the surrounding ecosystem. We investigate the practices followed by 47 commercial entrepreneurs in Kenya to "work around" these severe institutional voids to achieve their goals of business creation and growth. We find that severe institutional voids stimulate the hybridization of goals to include social value creation, create a need for a more strategic orchestration of business relationships, and motivate entrepreneurs to proactively cross-brace the institutional infrastructure around them. We contribute by unveiling the important role of entrepreneurs as microinstitutional agents in developing economies and by detailing how commercial and social goals become intertwined in the context of African entrepreneurship. [ABSTRACT FROM AUTHOR]

This study explores how multinational enterprises (MNEs) take advantage of their ownership-based political capital – political ties and political identity – in responding to institutional voids in host country contexts. Investigating multiple cases of central and local Chinese state-owned enterprises in Africa, we identify unique responding strategies comprising allied fleet and co-dependent alliance formations to overcome human capital voids, and dual management and closed-door management strategies to address industry standard voids. We propose a typology which extends the theory of MNE responses to institutional voids not only by adding the political dimension to strategy formation in responding to institutional voids, but also by providing greater insights into MNE strategies to convert home-based political capital for better response to host country institutional voids. [ABSTRACT FROM AUTHOR]

We advance research on the antecedents of business model design by integrating institutional and imitation theories to explore how the business model of new ventures evolves in a weak institutional environment. Based on a case study of Jumia—an online retailing company in Africa established with the aim to emulate the success of Amazon.com—we propose a process model entitled "imitate-but-modify" that explains how business models evolve through four distinct phases (i.e., clarification, legitimacy, localization, and consolidation). In essence, this model explains how new ventures surrounded by considerable uncertainty deliberately seek to learn vicariously by imitating the business model template of successful firms. However, because of significant institutional voids, the ventures' intentional imitation is progressively replaced by experiential learning that blends business model imitation with innovation. [ABSTRACT FROM AUTHOR]

Sweeping changes wrought by globalization and disaggregation of global value chains by multinational companies poses challenges to territorial theories of competitiveness. Contemplating notions propounded by economic geographers and strategic management scholars, the paper examines firm-level competitiveness at the intersection of spatially mobile versus spatially bound geographies. It aims to understand if linkages between actors within sticky local ecosystems are sufficient for firm internationalization from emerging economies. The paper empirically uncovers how cognitive ties at both local and global levels contribute to the internationalization of firms from emerging economies such as India that have a lower level of development and which suffer from institutional voids.

Copyright of Business Strategy & the Environment (John Wiley & Sons, Inc) is the property of Wiley-Blackwell and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

This article explores the role of institutional voids in the internationalisation of proto-modern brands in London from the mid-1820s through to the early 1850s. Internationalising firms addressed institutional deficiencies in the market through the establishment of retail operations identified here as international maisons spéciales and by adopting marketing strategies designed to legitimate their proto-modern brands. Together, these organisational and strategic marketing responses enabled firms to overcome institutional voids and shape market norms. These mutually supporting organisational and marketing innovations occurred at a much earlier date than the literature currently suggests. [ABSTRACT FROM AUTHOR]

We seek to understand how the strategic responses of firms to institutional voids are affected by their home countries' institutional contexts. It adopts an exploratory, multiple case studies approach examining the responses of advanced and emerging multinational enterprises, and local firms in two African countries which are characterized by such voids, namely the Democratic Republic of the Congo and Zimbabwe. Our research suggests that firms' strategic responses to institutional voids in emerging or developing markets are affected by the home country's institutional environment and firms' experiences and advantages arising from that home context. Firms adopt strategic responses which reflect their respective advantages and this results in diverse approaches based on the interplay between capitalizing upon internal resources and institutional know-how. For some firms this may result in a defensive strategic response, whilst for others opportunistic and aggressive agility, or rationalization and reconciliation may manifest. We demonstrate differences between advanced and emerging multinational enterprises and domestic firms covering the spectrum between institutional outsiders and insiders. We emphasize the contextual nature of these strategic responses and argue that this requires integrating both a resource and institution-based analysis of firms' underlying advantages and how they are able to leverage off these advantages in institutionally voided environments. Practical implications arise for doing business in emerging and developing markets. [ABSTRACT FROM AUTHOR]

Sweeping changes wrought by globalization and disaggregation of global value chains by multinational companies poses challenges to territorial theories of competitiveness. Contemplating notions propounded by economic geographers and strategic management scholars, the paper examines firm-level competitiveness at the intersection of spatially mobile versus spatially bound geographies. It aims to understand if linkages between actors within sticky local ecosystems are sufficient for firm internationalization from emerging economies. The paper empirically uncovers how cognitive ties at both local and global levels contribute to the internationalization of firms from emerging economies such as India that have a lower level of development and which suffer from institutional voids. [ABSTRACT FROM AUTHOR]

Driven by solid economic developments, emerging economies are experiencing significant institutional change, particularly in regulatory structures and market systems. Coupled with fierce market competition and reforms, serious challenges for the sustainable development of new ventures are created due to smallness and newness liabilities. This study examines how new ventures grow and adapt to the rapid environmental shifts in emerging economies by exploring the effects of entrepreneurial bricolage. This study found that entrepreneurial bricolage has a positive impact on both new venture growth and adaptiveness. Further, institutional voids have contrasting effects on these two relationships. The effectiveness of entrepreneurial bricolage on new venture growth is stronger in a context with serious institutional voids, while the effectiveness of entrepreneurial bricolage on new venture adaptiveness is weaker in a context with serious institutional voids. These findings not only enrich our knowledge on the implications of entrepreneurial bricolage, but also advance our understanding of the emerging economy context. [ABSTRACT FROM AUTHOR]

Although innovation studies in developing countries acknowledge the importance of resources for firm innovation, their emphasis tends to be on bottlenecks created by resource constraints and institutional weaknesses. We address this shortcoming by exploring the relationship among firm resources and formal and informal institutions leading to innovation in these settings. By adopting a crisp-set qualitative comparative analysis of firms in sub-Saharan Africa, we confirm the thesis that informal institutions substitute underdeveloped formal institutions and in combination with firm-level resources afford firm innovation. More importantly, we find that informal institutions also complement more developed formal institutions in the presence or absence of high levels of firm resources or accommodate them in the presence of high levels of firm resources to support firm innovation. Our findings point to multiple paths that firms can take to be innovative that best fit their existing institutional context. [ABSTRACT FROM AUTHOR]

We examine the demise of a multi-stakeholder network that was launched to promote an inclusive dairy market in Ethiopia to better understand why nongovernmental organizations (NGOs) may develop interventions in contexts of poverty that fail to endure after they exit. We identify organizational reflexivity – the capacity to recognize and understand the recursive interplay between an intervention and the local environment – as a key explanatory mechanism for this intervention outcome. Limited reflexivity not only prevented the NGO we studied from properly aligning the intervention with the context (design failures), but also prevented the organization from adjusting its intervention when negative feedback emerged (orchestration failures), which eventually evolved into the demise of the network (maintenance failure). While our study confirms the theoretical premise that NGOs need to contextualize their interventions, we expand current knowledge by highlighting the role of organizational reflexivity in this process. Moreover, by showing how reflexivity deficits can trigger a cascade of failure, especially when intervening in voids where incumbent firms have interests in maintaining the void, our study calls attention to the politicized nature of institutional voids. [ABSTRACT FROM AUTHOR]

This article inductively builds theory on how transaction costs may be alleviated and institutional voids bridged in developing economies, based on the case study of successful migrant entrepreneurial involvement in Nigerian agriculture: Shonga Farms. We argue that the iterative process of building conditions of trust through long-term commitment, involvement of regional government, appropriate modes of financial contracts and the gradual transitioning of controlling interests to private actors are factors of success. We draw additional lessons by contrasting our case study with other similar migrant schemes that have failed. [ABSTRACT FROM AUTHOR]

Building new space for institutional theory, we propose how the severity of formal and informal institutional voids shapes the productivity of entrepreneurial activities within society. Our theory makes the key assumptions that voids can exist in both formal and informal institutions and that they are capable of hindering entrepreneurial behavior that is favorable to development progress. We extend new theoretical domains by conceptualizing informal institutional voids and proposing how both formal and informal institutional voids and their interaction influence two qualitative outcomes within localities: (1) the unique forms of entrepreneurial activity, and (2) the objectives underlying this entrepreneurial activity. [ABSTRACT FROM AUTHOR]

In this paper, we explore the main inhibiting factors associated with the process of entry and escalation of SMES in international markets, with a focus on Emerging Markets. We identify and propose seven main categories of Institutional Voids and three main types of resources that may critically determine SMES’ performances on EMS, namely, internationalization knowledge, social capital resources and marketing capabilities. Institutional Voids and resources are brought together within a conceptual framework suggesting that resource-scarce SMES will hold back in their attempts to commit further to Emerging Markets and will be further dissuaded the higher the Institutional Voids in the market. The paper contributes to the policy literature on SME internationalization by focusing on two areas of public policy action that could have a clear and manifest impact on SMES conduct in Emerging Markets, the first related to the resources available to and exploitable by SMES and the latter associated with Institutional Voids.

How do institutional voids influence emerging market multinationals (EMNEs) foreign direct investment (FDI) in developing countries? In this article we respond to this question by examining Brazilian FDI in Angola as our analytical setting. We focus on the host country’s institutions and its institutional voids as essential factors that attract the FDI of EMNES to developing countries. The research indicates that Brazilian companies fill in much of these voids within the market intermediaries, often creating a point of competitive advantage, and also creating advantages in relation to FDI from other economies that invest in Angola. The scarce literature on FDI in Africa has been largely dedicated to the analysis of Chinese investment in the region. We aim to complement recent research on the influence of the host country’s institutions on the behavior of FDI in developing countries, explaining how some EMNEs are able to use the institutional voids of developing countries as market opportunities. Our findings should provide also implications for EMNEs managers from other emerging markets by providing a better understanding of how Brazilian multinationals expand their business in less developed countries, handle institutional voids and manage relationships with local and foreign institutions in the host country.

Purpose – This paper aims to determine the essential “collective goods” which a foreign multinational enterprise (MNE) must have before production can start in a remote area of an emerging economy, and to consider the alternative governance modes available to procure or create these goods. Design/methodology/approach – This purpose is examined conceptually and theoretically. First, the concept of “collective goods” is presented, followed by a consideration of the traditional “buy, ally or make” contractual approaches available to obtain goods and services. These approaches are repositioned in the context of an “emerging economy” so that alternative “ordering systems” as well as “non-contractual” means of obtaining things have to be considered in the context of internalization and reciprocity theories. Findings – It is difficult to obtain collective goods in remote areas of emerging economies where private ordering prevails and even succeeds but at high transaction costs and with substantial government intervention. However, the use of non-contractual modes of exchange such as reciprocity is available to facilitate exchanges between market MNEs and nonmarket state offices and civil-society associations such as non-governmental organizations with which collaboration is necessary but which cannot be acquired or controlled by MNEs. However, market firms can use philanthropy and lobbying to obtain the help of these nonmarket actors who know how to operate under private and state-ordering systems. Research limitations/implications – Theoretical implications: Internalization theory explains why MNEs are able to obtain collective goods by providing them “in-house”, while reciprocity theory exemplifies how non-contractual modes of exchange can substitute for the traditional but contractual “buy, ally and/or make”. Practical implications – Managerial implications: In terms of the organizational structure of the subsidiary of an MNE operating in an emerging economy, it appears that the line functions of procurement, engineering and production may rely more on contractual exchanges with foreign suppliers, while the staff functions of public affairs, government relations and human resources may be more adept at using reciprocal exchange with local suppliers. Originality/value – The provisioning of the collective goods when a firm builds its facilities in a remote and underdeveloped part of an emerging economy has hardly received any research attention nor have the non-contractual ways – such as reciprocity – available in the context of private ordering to obtain these goods.

How do entrepreneurs fill institutional voids that prevail in emerging markets? By incorporating insights from both the political and family embeddedness perspectives, we argue that both political ties and family ties can compensate for gaps in the institutional infrastructure of emerging markets. Specifically, we propose and examine the partial substitutability of family ties for political ties as a means of filling institutional voids. Our empirical work based on Chinese private enterprises strongly supports this argument. We also find that the effective utilization of family ties is contingent on both family members' motivation (willingness to use resources for the firm) and entrepreneurs' mobilization (authority in the family to mobilize family members). This study bridges the literature on political ties and family ties to understand their respective costs and benefits and therefore advances our understanding of entrepreneurs' networking strategies in emerging markets. [ABSTRACT FROM AUTHOR]

In this essay, we critique the usage of the term 'institutional void' to characterize non-Western contexts in organizational studies. We explore how 'conceptual stretching' of institutional voids – specifically, the theoretical and geographic expansion of the concept – has led not only to poor construct clarity, but also pejorative labelling of non-Western countries. We argue that research using this term perpetuates an ethnocentric bias by deifying market development and overlooking the richness and power of informal and non-market institutions in shaping local economic activity. We call for an 'epistemological rupture' to decolonize organizational scholarship in non-Western settings and facilitate contextually grounded research approaches that allow for more indigenous theorization. [ABSTRACT FROM AUTHOR]

The business environment in transition countries is often extraordinarily challenging for companies. The transition process these countries find themselves in leads to constant changes in the institutional environment. Hence, institutional voids prevail. These institutional voids cause competitive disadvantages for small and medium enterprises. Cluster policy can address these competitive disadvantages. As cluster policy generally aims at supporting companies’ competitive advantage by spurring innovation and productivity, it can help to bridge institutional voids. This article’s research question aims at analyzing and comparing cluster policies in the institutional context of two transition countries (Serbia and Tunisia) and analyzes to what extent cluster policies in these two countries are adapted to institutional voids prevailing there. The case studies offer insights into apparent difficulties of clusters in bridging formal institutional voids, as well as, notably, into the informal void of skill mismatches in the labor market. Still, for some specific voids, clusters do at least implicitly assume a bridging role. While the cluster policies examined do not explicitly target the institutional voids identified, cluster management can—in the course of time—align its service offering more closely with these voids. Bottom-up designed cluster policies can play an especially important role in such an evolution towards bridging institutional voids.

Emerging economies are characterized by the presence of institutional voids which challenge and constrain the behavior of economic agents. In this paper we report on one set of agents, angel investors, in Malaysia, which investors fear is experiencing a middle-income trap whereby economic growth and new venture formation stalls due to persistent institutional voids. This research addresses this question through interviews with 19 Malaysian business angel investors in 2015, utilizing a mixed-methods approach. Results indicate that business angels in our sample generated strong returns, though they did find it a challenge to invest in and monitor new ventures in a highly uncertain and competitive environment where there is high political uncertainty, weak legal and financial support for investors and SMEs. In order to overcome weak institutional support, business angel investors develop informal institutions by co-investing and networking with family members and government officials. They also conduct careful due diligence before investing and closely monitor their investee companies after investing. This research provides several theory and practice contributions with respect to business-angel investing in emerging economies with weak formal institutional regimes. [ABSTRACT FROM AUTHOR]