Product innovation capability, export scope and export experience

Abstract

Purpose By applying the logic of the resource-based view and process-based internationalisation theory, this study aims to provide a better understanding of the effects of product innovation capability on the export scope of firms based in developing countries and the role of export experience as a facilitating mechanism. Design/methodology/approach Using survey data obtained from three developing countries, two main research hypotheses were empirically tested: a quadratic relationship exists between product innovation capability and export scope and export experience has a moderating effect in this relationship. Findings Product innovation capability and export scope have a U-shaped relationship, and export experience exerts a moderating effect. The greater the export experience is, the more the relationship between product innovation and export scope changes, taking on a more inverted U-shaped form. Practical implications Firms based in developing countries need to catch-up on innovation capabilities before being able to succeed in international markets. Managers must be aware that initial investments in product innovation could not pay off immediately and that significant additional efforts might be needed to obtain noteworthy results in terms of international expansion. Originality/value This study is among the first to focus on the curvilinear relationship between product innovation capability and export scope for firms based in developing countries while accounting for the moderating role of firms’ export experience.