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Stuck at the bottom: Role of tacit and explicit knowledge on innovation of developing-country suppliers in global value chains |
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| Affiliation: | 1. National Research Base of Intelligent Manufacturing Service, Chongqing Technology and Business University, Chongqing 400067, China;2. Faculty of Business Administration, Memorial University of Newfoundland, St. John''s, NL A1B 3X5, Canada;3. Birmingham Business School, University of Birmingham, Edgbaston Park Road, Birmingham B15 2TY, UK;4. School of Business Management, Hongik University, Sejong 30016, South Korea |
| Abstract: | We take a social exchange theoretical perspective of innovation to develop and test a model of the intervening role of tacit and explicit knowledge exchange in explaining innovation of developing-country suppliers in non-equity-based global value chains (NEGVCs). Results of structural equation modelling for a sample of Bangladeshi suppliers embedded in apparel NEGVCs show that tacit and explicit knowledge fully mediate the associations between network competence and both low value-added and high value-added innovation contingent on the quality of network relationships. We also found that both tacit and explicit knowledge contribute more to low value-added innovation than to high value-added innovation. The managerial and policy implications of our findings as to why developing-country suppliers in NEGVCs are stuck in low value-added activities are fully discussed. |
| Keywords: | Network competence Innovation Tacit and explicit knowledge Non-equity global value chains |
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