Knowledge Sources of Persistent Exporters: Effects on the Growth and Productivity of Firms

Abstract

The idea that firm-specific advantages might be developed in strong clusters has been a mainstay of Michael Porter’s work and that such advantages developed in home markets can be leveraged into overseas markets has a long tradition in theories of the MNE (Dunning, 2001). It is well recognized in the literature that higher rates of innovation are associated with geographic clusters and there is a decay with distance which affects the extent of knowledge spillovers potentially available (Audretsch and Feldman, 1996; J af f e et al., 1993). It has long been recognized that MNE activity, and more generally the ability to succeed in overseas markets, is particularly associated with firms in knowledge-intensive and research and development (RScD)-intensive activities (Buckley and Casson, 1976). The resource-based view has become influential in international business as an explanation for why some firms are more successful in internationalization than others, with innovation again being a prime example (e.g. Oviatt and MacDougall, 1994). All firms may, in principle, draw on three sources of input to their innovation process: any specific advantages of their location; their own internal R&D effort and capabilities; and benefits based on external linkages, which may range from local to global. This chapter examines the linkages between access to different types of knowledge input and success in exporting and the influence of exporting, innovation and access to knowledge on firm performance.