Exploring institutional dynamics in a multi-level analysis in Southeast Europe

The European Union (EU) integration process of transition economies from Southeast Europe has faced significant political and economic challenges. Two decades in, these challenges persist, leading to slower-than-expected economic development and fostering local frustration, nationalism, populism, and migration flows. This article aims to disentangle the institutional complexities in these regions. Using an exploratory, inductive approach based on 30 qualitative interviews across three Southeast European countries, the research conducts a multi-level analysis. The findings reveal that complex institutional settings are characterised by institutional voids and asymmetries stemming from the transition process and EU integration. The perception of the overall institutional setup is central, negatively influenced by institutional voids and asymmetries but positively impacted by participatory law-making approaches. Additionally, competing institutional logics on the micro-level influence companies' perspective. This article provides insights into the institutional challenges faced by companies in transition economies, crucial for policy formulation and development projects in the context of EU integration. The key takeaway emphasises the importance of well-designed participatory policymaking, highlighting the need for careful preparation and a foundation of trust.