Abstract

Global value chains (GVCs) offer a range of opportunities to manufacturers interested in increasing their export market share by utilizing their business relationships with other firms. In recent studies, it is recognized that relational capital helps manufacturing firms to enhance their competitiveness in global markets. However, prior research does not provide a conclusive account of the impact of relational capital on their export performance in general, and particularly in the context of developing countries. Drawing on a learning-based perspective and contingency approach, this study fills these gaps by theorizing the link between relational capital and firm performance with a focus on developing-country firms that participate in GVCs. Specifically, we propose that the relational capital of these firms will have a stronger positive impact on their export performance when the market and technological turbulence are lower. The results confirm the key hypotheses by showing that developing-country firms' relational capital with buyers has a positive and significant impact on their export performance and that technological turbulence negatively moderates the relationship between relational capital with buyers and export performance. Overall, this research extends the literature on knowledge transfer, interfirm relational capital, and business performance in a developing country context.

Highlights

  • The findings of this study indicate that market turbulence does not significantly moderate the relationship between relational capital with buyers and export performance

  • Technological turbulence significantly moderates the relationships between relational capital with buyers and export

  • Technological turbulence does not moderate the relationship between relational capital with suppliers and export

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Summary

International business and global value chain (GVC)

A global value chain is a complex global production arrangement that breaks up the production process, so the different stages of production can be carried out by firms in various countries (World Bank, 2017). GVCs cover a chain of interrelated production activities performed by different firms that bring out a product or a service from conception to final product (UNCTAD, 2007). It is a value addition process, rather than just a system for delivering final goods to consumers. A value chain is a set of interrelated activities used by companies to create a competitive advantage (Tarver, 2018) It highlights geographic distance and international expansion of production and distribution. It focuses on value development and value acquisition throughout the supply chain activities (Gereffi, 2011). The concept of the value chain, and the global value chain, seem more appropriate than a supply chain to analyze the present production and distribution system in the global economy

Global value chains and firms’ business performance
Interaction within the global value chain and interfirm relationship
Interorganizational relationship and relational capital
Relational capital and trust
Commitment
Cooperation and common interest
Relational capital and interfirm learning opportunity
Transfer of knowledge
Joint learning
Relational outcomes and the firm's business performance
Cost advantage and easy access to a foreign market
Firm’s performance and turbulent business environment
Market turbulence
Technological turbulence
Moderating influence of market and technological turbulence
Gap in the existing literature and research opportunity
Theoretical framework
Hypothesis development
Firms relational capital with buyers impacts their export performance
Firms relational capital with suppliers impacts their export performance
Influence of market turbulence on the link between the firms’ relational capital and their export performance
Chapter 3 – Methodology
Research Timeline
Survey design
Nature of the survey research
Development of construct measurements
Questionnaire Layout
Research setting: profile of the Bangladeshi ready-made garment industry
Sample selection
Survey procedure
Data collection and analysis
Data screening
Scale validity and reliability
Method of data analysis This study used the Structural Equations
Data limitations
Full structural model testing
Moderation effect of market turbulence
Moderation effect of technological turbulence
Summary of the findings
The impacts of firms’ relational capital with buyers on their export performance
Moderating effect of market turbulence on relational capital and export performance link (H1a, H1b)
Moderating effect of technological turbulence on relational capital and export performance link (H2a, H2b)
Findings
Implications
Full Text
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