Abstract
Purpose
This study examines the influence of human capital, overall and by dimensions, on the export performance of small and medium enterprises (SMEs) in the manufacturing sector of Pakistan. The study also investigates the role of absorptive capacity in the relationship between human capital dimensions and export performance.
Design/methodology/approach
Data from 586 manufacturing sector SMEs were collected for analysis. The study applied covariance-based structural equation modeling (SEM) to estimate the hypothesized relationships.
Findings
As a whole, human capital was found to exert a direct and indirect impact on export performance, particularly for the medium-sized firms and for firms with medium to high levels of export intensities. Nevertheless, not all dimensions of human capital mattered for export performance. Education and training were found to pose the greatest influence on export performance of those firms.
Research limitations/implications
The results suggest that when devising appropriate policies for SMEs, the impact of different dimensions of human capital need to be considered for addressing challenges related to the internationalization of firms. In short, developing the right human capital is essential for SMEs to compete at the international level.
Originality/value
Unlike previous studies, this study decomposed the influence of different dimensions of human capital on export performance and assessed the mediating role of absorptive capacity. The study is also among the pioneering studies in SMEs sector of Pakistan to analyze the role of absorptive capacity in the relationship between various dimensions of human capital and export performance.
This study examines the influence of human capital, overall and by dimensions, on the export performance of small and medium enterprises (SMEs) in the manufacturing sector of Pakistan. The study also investigates the role of absorptive capacity in the relationship between human capital dimensions and export performance.
Design/methodology/approach
Data from 586 manufacturing sector SMEs were collected for analysis. The study applied covariance-based structural equation modeling (SEM) to estimate the hypothesized relationships.
Findings
As a whole, human capital was found to exert a direct and indirect impact on export performance, particularly for the medium-sized firms and for firms with medium to high levels of export intensities. Nevertheless, not all dimensions of human capital mattered for export performance. Education and training were found to pose the greatest influence on export performance of those firms.
Research limitations/implications
The results suggest that when devising appropriate policies for SMEs, the impact of different dimensions of human capital need to be considered for addressing challenges related to the internationalization of firms. In short, developing the right human capital is essential for SMEs to compete at the international level.
Originality/value
Unlike previous studies, this study decomposed the influence of different dimensions of human capital on export performance and assessed the mediating role of absorptive capacity. The study is also among the pioneering studies in SMEs sector of Pakistan to analyze the role of absorptive capacity in the relationship between various dimensions of human capital and export performance.
| Original language | English |
|---|---|
| Pages (from-to) | 643-662 |
| Number of pages | 20 |
| Journal | International Journal of Social Economics |
| Volume | 47 |
| Issue number | 5 |
| DOIs | |
| Publication status | Published - 8 Jun 2020 |
Keywords
- Absorptive capacity
- Export intensity
- Human capital
- Pakistan
- Small and medium enterprises
ASJC Scopus subject areas
- General Social Sciences
- Economics and Econometrics
