Determinants of SEZ Units' Export Performance and the Mediating Effects of Commitment, Knowledge and Capabilities

Abstract

Since exporting is the simplest way to reach the international market, understanding the determinants of a firm?s export market performance is the key to attain a better position in the export market. Using survey data of over 103 key people responsible for the export in the two Special Economic Zones (SEZ) in India namely Cochin and Madras SEZ. Drawing on Resource Based View theory, the study examines on location, firm size, firm age, international experience of key personnel and firm resources as potential determinants of firm-level export performance. In addition to that, it checks the mediating effect of capabilities, knowledge and commitment on export performance through resources. The findings show that the location, size, international experience and age of a firm have no relation with its export performance, whereas resources have significant positive relation. Resources directly influence the export performance and indirectly through commitment, knowledge and capabilities. Capabilities act as a good mediator between resources and performance compared to other mediators in the model. The firms are first recommended to acquire physical, human, financial and organisational resources to be successful in their ventures. On top, they are suggested to strengthen their relational, product development and informational capabilities along with acquiring export knowledge and increasing commitment.