Understanding the Environments of Emerging Markets: The Social Costs of Institutional Voids
Emerging markets have achieved fast growth rates over the past ten years, but they still lag behind developed countries in several key social dimensions. One of the reasons for such unbalanced growth is the frequency of institutional voids. Institutional voids are commonly defined as gaps between rules and their purpose, and the effectiveness of their implementation. Though institutional voids can be positive by creating spaces for new business and entrepreneurship, it is also important to consider that voids emerge when economic growth advances faster than social and institutional structures. Voids can therefore generate unwanted consequences for society, such as the over-exploitation of human and natural resources.