The role of market knowledge and institutional networks in improving the export performance of apparel manufacturers in a developing country

Abstract

This study explores the relationship between foreign market knowledge, institutional networks, and export performance and argues that it is insufficient for exporting firms to rely only on market knowledge to improve their performance. Foreign market knowledge must be supported by institutional networks to have a positive impact on export performance. This study is based on a survey of 206 apparel exporters from Bangladesh, the world’s second-largest apparel exporter. We used regression analysis to examine the links between foreign market knowledge and export performance and the moderating influence of institutional networks. We found that of three dimensions of foreign market knowledge (institutional, business, and internationalization), only foreign business knowledge directly and positively affected export performance. Foreign internationalization knowledge significantly affected export performance only when moderated by institutional networks. This research makes significant contributions to the knowledge-based view and institutional network theory in internationalization and provides several managerial and academic implications.