Absorptive Capabilities and Export Performance: the Mediating Effect of Innovation

Abstract

This paper aims to assess the relationship between absorptive capabilities and export performance of Portuguese small and medium enterprises (SMEs) exporting textiles, considering the mediating affect of innovation on it. Based on survey data from 247 firms, our empirical results indicate that: 1) absorptive capabilities have a positive and direct effect on innovation and export performance; and 2) innovation has a mediating effect on absorptive capabilities-export performance relationship. This study provides new insights into strategic management literature, since it considers the importance of multiple factors to SMEs business growth. Moreover, this paper presents empirical evidences of the strategies that small firm managers should consider.

Keywords: Absorptive capabilities, Innovation, Export performance, SMEs, Portuguese textile industry, PLS-SEM.