Institutions and social entrepreneurship: a hierarchy of institutions to revisit institutional voids, support, and configurations

In this retrospective, we expand on theorizing about institutions and social entrepreneurship (SE) as presented in our Decade Award-winning 2015 article. Our 2015 paper developed the institutional configuration perspective, which considers joint and interaction effects of formal and informal institutions. It organized disagreement about how formal institutions shape SE, contrasting the institutional voids and institutional support perspectives. In this retrospective, we introduce a revised hierarchy of institutions as a ‘middle-ground’ approach to advance research on institutions in international business and entrepreneurship. This hierarchy integrates insights from different disciplines (institutional economics, sociology, political science, and cultural theory). It explicates the macro-level economic and microfoundational psychological effects of four layers of formal (government activism and constitutional institutions/rule of law) and informal institutions (cultural values and norms). The hierarchy progresses research on institutional voids by distinguishing four types of formal and informal institutional voids. It advances research on institutional configurations by highlighting new synergistic and compensatory configurations. It also offers new insights into institutional change. Finally, we advance research on institutions and SE by theorizing a new institutional paradox for SE that reconciles the institutional void versus support debate and by charting opportunities for how institutions shape the SE process from entry to exit.