Institutional stratification and its entrepreneurial inequality effects on micro-enterprises: evidence from Morocco’s craft sector
Nisrine Tahri, David HayesPurpose
State-led institutional reforms in emerging economies often exacerbate, rather than reduce, entrepreneurial inequality. This study aims to engage directly with debates about development and stratification by conceptualizing this phenomenon as state-induced symbolic stratification. Specifically, we demonstrate how formal policy classifications acquire asymmetrical symbolic and institutional value. Rather than serving as a neutral framework, these regulatory systems actively construct and entrench inequalities deep within entrepreneurial ecosystems.
Design/methodology/approach
This research uses a qualitative design centered on 20 semistructured interviews. Our respondent pool intentionally spans production and service artisans, as well as key institutional actors within Morocco’s craft sector. To ensure analytical rigor, we triangulated these interview narratives with official policy documents. We then thematically analyzed the final dataset using a neo-institutional framework, focusing on coercive pressures and legitimacy dynamics.
Findings
Our analysis highlights seven mechanisms through which regulatory reforms can institutionalize inequality. Instead of a uniform system, Law 50.17 can create an asymmetric structure that segments access to markets, finance, resources and representation. Production artisans fit into state narratives on patrimonial value, exhibition and export, while service artisans potentially lack institutional pathways. Despite perceptions of legal inclusivity, these classifications may produce disparities in legitimacy, visibility and market access. This study demonstrates how state modernization shifts from neutral administration to stratification, valuing certain entrepreneurial identities while possibly marginalizing others.
Research limitations/implications
Although the study’s focus on Morocco limits generalizability, the underlying framework offers an analytically transferable model. Specifically, it offers a framework for examining how formal regulatory architectures in other emerging economies inadvertently create internal, intrasectoral inequalities. Future comparative scholarship should use this framework to test the limits of state-driven stratification across parallel institutional ecosystems.
Practical implications
To foster meaningful equity, policymakers must align reforms with Morocco’s fractured craft sector realities. Ensuring access to vocational training, funding, promotion and representation is key. Targeted support and participatory governance can dismantle systemic exclusion. Moving away from a product-only bias enables inclusive economic growth.
Social implications
The findings indicate potential social consequences associated with unequal institutional positioning. Participants’ accounts suggest that distrust of representative organizations may weaken collective action, while concerns about declining apprenticeship raise questions about intergenerational skill transmission. The evidence does not establish category-specific differences in community resilience; future comparative and longitudinal research should examine these outcomes directly.
Originality/value
The study advances neo-institutional theory by viewing symbolic stratification as an inequality embedded in regulatory design. Instead of seeing stratification through institutional voids or pluralistic logics, it focuses on the state. It shows how state authority uses cultural narratives to shape legitimacy and entrepreneurial opportunities.