Knowledge absorptive capacity: do all its dimensions matter for export performance of SMEs?
Mwesigye Ahimbisibwe, Godwin
Korutaro Nkundabanyanga, Stephen
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In this paper, we study the relationship between knowledge absorptive capacity (KAC) and export performance of developing country SMEs where empirical evidence is currently scarce. We particularly report the contribution of the four dimensions of KAC (knowledge acquisition capacity, assimilation capacity, transformation capacity and application capacity) to export performance. Given the impulsiveness of international business environment, knowledge is an important capability required by SMEs for competition in export markets (Kedia & Bhagat, 1998; Lopez & Rodriguez, 2005) - requiring internationalizing firms to recognize the value of external knowledge and also generate and apply it to commercial ends (Zahra and George 2002). Firms recognizing the importance of external knowledge perform better in exporting; manifest in their likelihood to devise and adapt their products, services and processes that continue to meet the needs of the evolving market (Kropp et al. 2006; Mehmet, 2008). The lack of knowledge has been cited as one of the possible factors explaining the marginal performance of exporting firms in emerging economies (Onyeiwu, 2011; Okello-Obura et al, 2008). But, while the importance of KAC of firms has been widely researched and documented since the influential paper of Cohen and Lenvinthal (1990), most research has concentrated on assessing its impact on the performance of large firms within their domestic markets (Rothermel & Alexandre, 2009; Jansen et al, 2005) as opposed to export markets; moreover, also ignoring its possibility to explain significant variances in performance of exporting SMEs in developing countries. Indeed, Onyeiwu, (2011) posit that the role of KAC has been underplayed by the literature on Africa’s economic growth.
- Social Sciences