INCLUSIVE INSTITUTIONS AND SMALL AND MEDIUM-SIZED ENTERPRISES: INSTITUTIONAL, SOCIOLOGICAL, AND TECHNOLOGICAL APPROACHES

• Erzhan Issabayev

  Narxoz University

  Author

The purpose of this paper is to analyse the impact of inclusive institutions on the development of small and medium sized enterprises (SMEs) in Kazakhstan, taking into account the theoretical approaches of D. North, D. Acemoglu and J. Robinson, as well as the role of trust, informal norms, and modern technology companies as new institutional intermediaries. The study is based on comparative institutional analysis, the methodology of new institutional economics and economic sociology, a theoretical synthesis of concepts of formal and informal institutions, E. Giddens’ notion of trust in abstract systems, and an analysis of empirical data on SME development in Kazakhstan. Official statistics, government entrepreneurship support programmes and materials on the development of the fintech ecosystem are used. This paper proposes an expanded interpretation of inclusive institutions, incorporating technological platforms as elements of a new institutional infrastructure. It brings together, within a single analytical framework, North’s ideas on formal and informal institutions, Acemoglu and Robinson’s concept of inclusive and extractive institutions, and Giddens’ approach to trust as the foundation for the functioning of complex modern systems. Special attention is given to the role of SMEs as an informal institution facilitating migrant adaptation in the context of urbanisation (using Almaty as a case study). The study shows that Kazakhstan’s institutional environment is in a transitional stage: formal norms are modernising more rapidly than deeply rooted informal practices. Institutional inclusiveness is strengthened through deregulation, digitalisation, and the development of f intech companies; however, significant barriers persist—corruption, administrative pressure, limited access to finance, and a deficit of trust in key state institutions. It is argued that SMEs perform not only an economic function but also a social and integrative one, easing migrant adaptation in metropolitan settings. A set of recommendations is proposed for strengthening institutional trust and reducing transaction costs for SMEs.

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