Social innovation under institutional voids: micro–macro dynamics in Lithuania

Abstract

Social innovation is increasingly promoted as a response to complex societal challenges, yet its development remains highly uneven across institutional contexts. This article examines how social innovation emerges and evolves within a transition economy characterised by institutional voids, using Lithuania as an in-depth qualitative case study. Drawing on institutional theory and the six-stage social innovation framework, the study analyses the interaction between macro-level formal and informal institutions and micro-level innovation processes within social enterprises. The empirical material is based on 18 semi-structured interviews with key field actors, including social entrepreneurs, policymakers, support organisations and researchers. The findings reveal that regulatory ambiguity, bureaucratic rigidity and weak societal legitimacy constitute persistent institutional voids that constrain social innovation across different stages of its development. At the same time, these voids stimulate adaptive strategies at the micro level, such as reliance on informal networks, international funding and flexible organisational practices. By integrating institutional theory with a process-oriented innovation framework, the article contributes to social innovation research by demonstrating how institutional voids simultaneously constrain and shape innovation trajectories. The study offers policy-relevant insights for strengthening social innovation ecosystems in transition economies, highlighting the need for clearer legal frameworks, enhanced institutional coordination and greater investment in capacity building and societal trust.