Firm-specific and institutional factors as export performance catalysts: Insights from a developing economy (original) (raw)
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Small Business Economics, 2013
It is widely accepted that countries with sound formal and informal institutions create more robust environments for firm performance. However, due to the liabilities faced by firms without available slack and/or market power, we contend that institutions are especially important for new and small firms. Unfortunately, there is little research examining the potential moderating effect of firm size or age on the relationship between institutional quality and export performance. In response, we hypothesize that institutional quality will be more important to increasing the export performance of new and small firms compared with their large, established counterparts.
Financial Obstacles to Firm Export: Insight from a Developing Country
Social Science Research Network, 2011
This article investigates the most frequent financial obstacles to firm export and depicts their severity by examining firm perception about them. By using descriptive and multivariate probit model analyses, we find that cost of finance, lender's bias and partial lending are considered as the foremost financial export barriers to Pakistani firms, while firm size, industry, and firm ownership are the most prevailing expounding factors to the perception of obstacles. A significant difference was found to exist between the two firm size categories. After controlling firm size, large firms having state-ownership or foreign-ownership do not seem to perceive financial impediments as a determinant of export. KEYWORDS developing country, export, financial obstacles, multivariate probit model One of the most remarkable phenomena of the twenty-first century is globalization of the business environment, resulting in many prospects that are significant not only for economic development of most economies, but also for the growth and competitive edge of most of the firms today. Impelled by advancement in transportation, communication, liberal trade policies, and financial systems, firms have increasingly been adopting the attitude termed as ''the world is our market'' (Leonidou, 1994). For firms wishing to internationalize, exporting is by far the most common and economical mode through which firm growth materializes. It involves low resource commitment, minimum risk and offers high flexibility of management actions. However, it is also associated with low profit return
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the current study investigates the direct and indirect effects of firm-specific and environmental factors on export performance. specifically, the study investigates the direct and indirect (mediation role of promotion (Pr) and research & development (rD) activities) effect of capital structure (cs), availability of cash (ca), competition from informal sector (ci), and political instability in home countries (Pi) on export performance (eXP). Partial least square structural equation model (Pls-seM) is used to analyze a year data (2022) from sample of 161 firms in ethiopian manufacturing industry (i.e. leather industry, textile industry, and Food & Beverage industry), to find the relation between independent (cs, ca, ci, and Pi), mediating (Pr and rD), and dependent (eXP) variables after controlling for factors like firm size, and industry category. the result indicates that cs has robust direct and indirect effects on eXP while Pi has only direct effect. however, ca needs the intermediation of other variables (i.e. rD) to affect eXP. this finding supports the argument that assessments of direct relationships should not be the primary concern in marketing studies; rather, the sum of the direct and indirect effects of a particular variable must be evaluated for more interpretation.
SME export performance, capabilities and emerging markets: the impact of institutional voids
European J. of International Management, 2017
In this paper we address the theme of the export performance of the SME in the context of emerging markets. Surveying a sample of 200 exporting SMEs, we test specific hypotheses concerning the role of Institutional Voids (IVs) both in directly affecting the export performance of the SME and in moderating the positive impact of the SME's resources and capabilities. Our results show that while directly hampering the export performance of the SME, IVs also have a negative moderating role on the firm's marketing capabilities.
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Financial considerations play a major role influencing the internationalization of firms. However, it is not clear how integrated financial factors such as cost and capital are related to the export behavior of small- and medium-sized enterprises (SMEs). The purpose of this study is to examine financial profiles of SMEs in an emerging economy by discriminating between non-exporters and exporters. Survey data from 356 SMEs in Malaysia was analyzed to see how perceived costs, internal financial resources, and external capital constraint are associated with their export status. Through a multiple logistic regression model, it is found that exporters perceive higher internal financial resources and fewer constraints in accessing external capital. They also perceive higher export costs than non-exporters. This study offers academics, entrepreneurs, and policy-makers a comprehensive understanding of financial characteristics that explain the export behavior of SMEs in developing countries.
Antecedents of export performance: the case of an emerging market
International Journal of Emerging Markets, 2013
Purpose-The purpose of this paper is to provide a framework for understanding the relationships between resource commitment, management experience, firm size, internationalization, internal export barriers and export performance in firms. Specifically, this paper empirically investigates the impact of resource commitment, management experience, firm size, and internationalization on export performance, using internal export barriers as an intervening variable. These antecedents of export performance are selected because they are constraints that managers have an opportunity to influence. This study is therefore relevant to the managerial process. Design/methodology/approach-A survey design using firms from Ghana was chosen. This was expected to be an appropriate population from which data could be gathered to investigate the authors' hypotheses. In order to test these hypotheses, questionnaires were designed to collect data from small and medium export firms in an emerging market. Data on resource commitment, management experience, firm size, internationalization, internal export barriers and export performance were collected. The data was then analysed by applying path analysis using LISREL 8 in testing the hypotheses. Findings-Results from the study shows that in this market, firm size is related positively to internal export barriers, firm size and internal export barriers are related positively to export performance, and that internationalization is related negatively to export performance. The observation suggests that a large firm size and a good internationalization strategy are the most effective strategic options for enhancing firm export performance in this market. Another observation from the study was that firms in emerging markets lack the needed resource commitment to export. Practical implications-Results of this study add to prior literature by identifying variables which contribute to the improvement of both internal export barriers and export performance in an emerging market (sub-Saharan Africa). The study provides advice to managers who are trying to improve the export performance of a firm in an emerging market and to policy makers about how an emerging market can improve its export industry. Originality/value-This research work serves as an important guide for future researchers who intend to study export problems in other emerging economies. Policy makers in emerging economies may refer to this work to identify export problems that firms face in order to provide timely and effective assistance to small and medium scale enterprises engaged in export ventures. The paper believes the benefit of internationalization is realized as managers' leverage the learning opportunities accumulated over the years through exposure to the international market. Managers need to develop considerable capabilities and competencies to identify the specific barriers they must overcome in order to formulate appropriate export strategies.