The importance of institutional and financial resources for export performance associated with technological innovation

This study adopts a resource contingency perspective to examine the impact of technological innovation on export performance of manufacturing firms. In view of institutional voids and capital market imperfections in emerging economies, we propose that two types of resources, institutional resources and financial resources, are of differential value in the innovation-exports nexus. Empirical results, based on a large sample of Chinese manufacturing firms, show that technological innovation embodied in the patent has positive effect on exports, but such effect is diminished by institutional resources (captured by state-ownership, business group affiliation and government subsidy) and enhanced by internal financial resources (captured by financial slack).