Title: The effect of firm absorptive capacity on learning by importing: mediation role of industry policy-induced intermediate input import

Authors: Moges Tufa; Måns Söderbom

Addresses: Department of Economics, Addis Ababa University, Ethiopia ' Department of Economics, University of Gothenburg, Sweden

Abstract: A growing body of evidence from studies on firms suggests that firm-level capability building is important for a firm's sustained competitiveness and national growth. In this paper, we base our argument on contemporary theories of firms to investigate the link between a firm's absorptive capacity and its effects to utilise external opportunities. The study also examines the mediation role of sector-specific industry policy in channelling the relationship between firm absorptive capacity (firm internal resource-bases) and learning by importing. We applied nonlinear generalised structural equation model (GSEM) on the mix of administrative and survey data from 271 chemical manufacturing firms in Ethiopia. We estimate direct, indirect, total effects and mediation paths tests. Our findings support the hypotheses and the results are consistent across analysis steps. The notable finding implies the existence of a positive and significant association between firm internal resource bases and firm learning by importing. Heterogeneous and marginal analysis was discussed.

Keywords: industry policy-induced; learning by importing; open innovation; absorptive capacity; GSEM; mediation; Ethiopia.

DOI: 10.1504/IJBFMI.2024.139336

International Journal of Business Forecasting and Marketing Intelligence, 2024 Vol.9 No.3, pp.243 - 270

Received: 17 May 2023
Accepted: 28 May 2023
Published online: 01 Jul 2024 *

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