Home country institutions and export behaviour of SMEs from transition economies: the case of Russia

Abstract

This study examines the relationship between home country institutional environment and export behaviour of small and medium-sized enterprises (SMEs) from transition economies. It is argued that perceived institutional challenges in home country may explain significant differences in exporting among firms. By focusing on Russia, as a context of transition economy, it is empirically tested how the perceived tax and financial barriers define export propensity of SMEs, and whether corruption concerns can play a role of a moderator and navigate firms' export activities. Data on 3136 Russian SMEs provide strong support for the effects of the perceived institutional dimensions on firms' propensity to export. The results offer a more fine-grained picture of institutional environment by contributing to the extant literature and show that the impact of home country institutions is dependent on the subjective perception which plays an important role in shaping export behaviour of Russian SMEs. The implications are discussed.