A.F.M. Jalal Ahamed a, Rodney L. Stump b & Kåre Skallerud a a School of Business and Economics, UiT The Arctic University of

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1 This article was downloaded by: [UiT Norges arktiske universitet] On: 09 September 2015, At: 02:27 Publisher: Routledge Informa Ltd Registered in England and Wales Registered Number: Registered office: 5 Howick Place, London, SW1P 1WG Click for updates Journal of Relationship Marketing Publication details, including instructions for authors and subscription information: The Mediating Effect of Relationship Quality on the Transaction Cost Export Performance Link: Bangladeshi Exporters' Perspectives A.F.M. Jalal Ahamed a, Rodney L. Stump b & Kåre Skallerud a a School of Business and Economics, UiT The Arctic University of Norway, Tromsø, Norway b Department of MarketingTowson University, Towson, MD, USA Published online: 29 Jun To cite this article: A.F.M. Jalal Ahamed, Rodney L. Stump & Kåre Skallerud (2015) The Mediating Effect of Relationship Quality on the Transaction Cost Export Performance Link: Bangladeshi Exporters' Perspectives, Journal of Relationship Marketing, 14:2, , DOI: / To link to this article: PLEASE SCROLL DOWN FOR ARTICLE Taylor & Francis makes every effort to ensure the accuracy of all the information (the Content ) contained in the publications on our platform. However, Taylor & Francis, our agents, and our licensors make no representations or warranties whatsoever as to the accuracy, completeness, or suitability for any purpose of the Content. Any opinions and views expressed in this publication are the opinions and views of the authors, and are not the views of or endorsed by Taylor & Francis. The accuracy of the Content should not be relied upon and should be independently verified with primary sources of information. Taylor and Francis shall not be liable for any losses, actions, claims, proceedings, demands, costs, expenses, damages, and other liabilities whatsoever or howsoever caused arising directly or indirectly in connection with, in relation to or arising out of the use of the Content. This article may be used for research, teaching, and private study purposes. Any substantial or systematic reproduction, redistribution, reselling, loan, sub-licensing, systematic supply, or distribution in any form to anyone is expressly forbidden. Terms &

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3 Journal of Relationship Marketing, 14: , 2015 Copyright Taylor & Francis Group, LLC ISSN: print / online DOI: / The Mediating Effect of Relationship Quality on the Transaction Cost Export Performance Link: Bangladeshi Exporters Perspectives A.F.M. JALAL AHAMED School of Business and Economics, UiT The Arctic University of Norway, Tromsø, Norway RODNEY L. STUMP Department of Marketing, Towson University, Towson, MD, USA KÅRE SKALLERUD School of Business and Economics, UiT The Arctic University of Norway, Tromsø, Norway This study explores how relationship quality might mediate the link between transaction cost variables and export performance. In the proposed conceptual model, relationship-specific assets and uncertainty affect export performance both directly and through relationship quality; survey data from 185 exporting organizations in Bangladesh provide the test of this model. This article thus proposes that transaction cost economics and relational exchange theories are complementary rather than competing theories. These conclusions arise because this study accounts for not only the direct effect of asset specificity and uncertainty on export performance but also their indirect effects through relationship quality, which have not been empirically tested or clarified previously. KEYWORDS partial least squares (PLS), relational exchange theory (RET), RELQUAL, specific assets, uncertainty Transaction cost economics (TCE; Williamson, 1975, 1998) and relational exchange theory (RET; Macneil, 1980) are among the most widely used theoretical explanations of business-to-business exchanges in marketing (Lui, Wong, & Liu, 2009; Rokkan, Heide, & Wathne, 2003), despite their apparent conflicts. That is, TCE is rooted in behavioral assumptions of bounded rationality and opportunism (Williamson, 1975, 1998), which imply that formal Address correspondence to A. F. M. Jalal Ahamed, School of Business and Economics, UiT The Arctic University of Norway, N-9037, Tromsø, Norway. jalal.ahamed@uit.no 152

4 A. F. M. J. Ahamed et al. 153 contracts (governance mechanisms) must specify the terms and conditions of transactions to reduce the potential for opportunism (Lui et al., 2009). Its key variables, as articulated by Williamson (1975, 1998), are asset specificity, uncertainty, and transaction frequency. In contrast, RET advocates social exchange mechanisms based on trust and relational bonds (Wathne & Heide, 2000), so relationship quality (RELQUAL) is its central construct (Jap, Manolis, & Weitz, 1999; Smith, 1998). Several studies have attempted to bridge the gaps between these theories by applying relational variables within a TCE framework (De Vita, Tekaya, & Wang, 2011; Lui et al., 2009; Poppo & Zenger, 2002; Stump & Joshi, 1999; Young-Ybarra & Wiersema, 1999). However, though TCE is popular in marketing and international business research, it rarely has provided the theoretical basis for explanations of the determinants of export performance. Rather, it more often seeks to explain a firm s choice of foreign market entry mode (Andersen, 1997; Brouthers, 2013; Brouthers, Brouthers, & Werner, 2003; Whitelock, 2002), the degree of control applied in international joint ventures (Mjoen & Tallman, 1997), industrial purchasing relationships (Buvik & Reve, 2001), or control over export marketing channels (Skarmeas & Robson, 2008). Furthermore, though evidence confirms that relational variables serve governance mechanisms and can safeguard against opportunistic behavior in the presence of transaction-specific assets (Skarmeas & Robson, 2008; Stump & Joshi, 1999), the link between asset specificity or uncertainty and export performance is rarely addressed. Finally, no studies have conducted empirical tests of the indirect effects of TCE variables on export performance through RELQUAL. In response, this study seeks to expand the existing knowledge base related to export performance by investigating both direct and indirect effects of TCE variables (asset specificity and uncertainty) on the performance of Bangladeshi exporters. We propose that both of the theories are complementary while also advancing knowledge of export import relationships. Such insights can help clarify cross-border business relationships, which have grown increasingly important in global markets. THEORETICAL BACKGROUND Transaction Cost Variables According to the TCE framework, parties to an exchange relationship always are motivated by self-interest and engage in opportunistic behavior if they can (Stump, Athaide, & Joshi, 2002) or self-interest seeking with guile (Williamson, 1975, p. 9). John (1984) cited opportunism as a key driver of transaction costs, in that it implies a failure to fulfill promises and obligations by exchange partners (Dorsch, Swanson, & Kelley, 1998; Wathne & Heide, 2000). Asset specificity results when assets or investments are dedicated to a

5 154 Transaction Cost Export Performance Link focal relationship and have little or no value outside that exchange relationship (Stump et al., 2002). Such investments create an incentive to maintain the relationship, because the investing party cannot leave the relationship without suffering some economic loss. RELQUAL The relationship marketing literature acknowledges the centrality of RELQUAL, defined as the strength of the relationship between the involved parties (Smith, 1998; Ural, 2009). As a higher order construct, RELQUAL comprises a set of distinct, related dimensions (C. Lages, Lages, & Lages, 2005; Leonidou, Barnes, & Talias, 2006; Skarmeas & Robson, 2008; Skarmeas, Katsikeas, Spyropoulou, & Salehi-Sangari, 2008; Ural, 2009), though no consensus exists regarding precisely which dimensions constitute RELQUAL. Considering evidence from existing marketing studies, we include satisfaction, commitment, and trust in this study (Athanasopoulou, 2009; Morgan & Hunt, 1994; Skarmeas & Robson, 2008; Ulaga & Eggert, 2006). Trust, which implies belief in others, integrity, reliability, and confidence between trading parties (Dorsch et al., 1998), is a cornerstone of business marketing and a determinant of profitable business relationships (Morgan & Hunt, 1994). Commitment also is fundamental; it represents the highest level of relational bonding between parties and underlies successful relational exchanges (Dorsch et al., 1998). Furthermore, commitment is a key determinant of export performance (Bloemer, Pluymaekers, & Odekerken, 2013; Cavusgil & Zou, 1994), in that it can lead to outcomes such as cooperation, reduced conflict, satisfaction, and relationship longevity (Morgan & Hunt, 1994; Skarmeas, Katsikeas, & Schlegelmilch, 2002). We define it as an enduring desire on the part of an exporter to maintain a valued export import relationship (Gundlach, Achrol, & Mentzer, 1995; Moorman, Deshpande, & Zaltman, 1993). Finally, satisfaction is a positive affective state that results from an appraisal of all aspects of the working relationship (Geyskens, Steenkamp, & Kumar, 1999); it helps increase morale and cooperation between parties as well as reduces litigation or termination propensities (Ganesan, 1994; Geyskens et al., 1999). Export Performance Despite considerable research into export performance as a central construct for international marketing (Diamantopoulos, 1999), its definition remains elusive and contextual. In their extensive literature review, Zou, Taylor, and Osland (1998) derived a comprehensive definition that we adopt: The performance of an exporting venture comprises its financial and strategic performance, as well as the firm s satisfaction with the export venture (Ural, 2009).

6 A. F. M. J. Ahamed et al. 155 HYPOTHESIS DEVELOPMENT Specific Assets, RELQUAL, and Export Performance In interfirm cooperation research (Lui et al., 2009), specific assets take both human and physical (i.e., tangible and intangible) forms that apply specifically to and enable a particular exchange relationship (Heide & John, 1988; Lohtia, Brooks, & Krapfel, 1994), such as investments in capital equipment, dedicated human resources, or specialized information systems. We define specific assets according to the degree to which they are dedicated, by an exporting firm, to its transactions with a particular importer (Skarmeas & Robson, 2008). The non-redeployable nature of specific assets makes it costly to switch them to a new relationship, so they increase the risk of opportunistic expropriation by the partner (John & Weitz, 1988; Stump et al., 2002). Multiple facets of asset specificity have been documented already (De Vita et al., 2011), such that this construct takes on various meanings in distinct research streams, such as RET and the resource-based view (De Vita et al., 2011; Lui et al., 2009). That is, specific assets might serve an ex ante signaling role and express the firm s desire to increase the closeness of the exchange relationship partner or exhibit its commitment to the relationship. They also can act as an ex post bond or safeguard against opportunism by the party that tenders the specific assets (Anderson & Weitz, 1992; Stump, 1995). To protect against possible opportunistic behavior, firms might demand specific investments from their partners. Specialized human assets are the most common assets invested into a specific business relationship, because the time and effort devoted to acquiring firm-specific skills are wasted if the relationship ends. The degree of investment also is a matter of concern for TCE scholars (Buvik & Reve, 2001), because it defines the level of dependence of each party and thus the risk of opportunism. From an RET perspective though, scholars tend to argue that idiosyncratic investments in specific assets by exporters create self-binding and send positive signals to the importer, such that it gains more trust in the exporter. Such idiosyncratic investments also can lower production costs and improve product quality, which ultimately should increase the importer s confidence in the exporter (Skarmeas & Robson, 2008). Because it is more costly to search for a new customer than to retain an existing one, we argue that investments in specific assets increase RELQUAL and enhance export performance. Several studies confirm that specific assets increase cooperative behavior and improve interfirm relationship performance (for a review, see De Vita et al., 2011). Ghani and Khan (2004) also found that asset specificity is associated with support, information sharing, and trust. Such evidence indicates that specific assets offer sources of postcontractual support and important tools for combating opportunism (Heide & John, 1988; Stump et al., 2002; Zaheer & Venkatraman, 2007). We therefore postulate the following:

7 156 Transaction Cost Export Performance Link H1: Specific assets relate positively to RELQUAL. H2: Specific assets relate positively to export performance. Uncertainty, RELQUAL, and Export Performance A convincing definition of uncertainty suggests that it refers to events that cannot be forecasted (Lorenzi, cited by Raven, McCullough, & Tansuhaj, 1994, p. 40) and occurs because of a dearth of appropriate or timely information (Leonidou et al., 2006). The presence of uncertainty in turn is inevitable in export markets (Leonidou et al., 2006). Environmental uncertainty, or at least the perception of it, is the perceptual process mediating a transaction between the individual and the external environment (Raven et al., 1994, p. 40). In cross-border export import relationships, environmental uncertainty occurs for two main reasons: (a) diversity, or the existence of multiple external factors that need to be considered before making decisions; and (b) the dynamics associated with the external environment (Leonidou et al., 2006). During the early stage of export import relations, environmental uncertainty can be prominent, but at more advanced stages, when the firm has gathered adequate foreign market information, environmental uncertainty should be less influential (Leonidou et al., 2006). We assume that the effect of these uncertainties could be harmful for the RELQUAL between partners. Leonidou et al. (2006) showed that uncertainty creates a major hurdle to harmonious exporter importer relationships because it tends to create information asymmetries and fuel opportunism (Klein et al., 1990). Uncertainty also can hamper additional investments in the relationship (Hedaa, 1993) and induce coordination problems (Leonidou et al., 2006). Thus, we propose the following: H3: Uncertainty relates negatively to RELQUAL. H4: Uncertainty relates negatively to export performance. The Mediating Role of RELQUAL In addition to testing the direct effects of specific assets and uncertainty, we argue that RELQUAL may mediate the relationship between uncertainty and export performance. The statistical disposition of mediation models states that an independent variable (X) causes an intervening variable (I), which in turn causes the dependent variable (Y ) (MacKinnon, 2002, p. 83). Prior literature already has shown that specific assets relate positively to RELQUAL (Skarmeas & Robson, 2008) but that uncertainty negatively influences RELQUAL (Leonidou et al., 2006). The direct effects of specific assets and uncertainty on export performance are empirically conclusive. Further-

8 A. F. M. J. Ahamed et al. 157 FIGURE 1 Conceptual Model. RELQUAL = relationship quality. more, several studies have cited a positive effect of RELQUAL or its major dimensions on export performance (Ahamed & Skallerud, 2013; C. Lages et al., 2005; Skarmeas & Robson, 2008; Ural, 2009). Accordingly, we consider potential mediators in these links, and our theoretical analysis leads us to propose RELQUAL as a mediating variable in the specific assets export performance and uncertainty export performance relationships. Investments in specific assets should have positive impacts on RELQUAL, which in turn should exert a positive effect on export performance. That is, increases in investments in specific assets intensify RELQUAL and increase the likelihood that export performance improves. In contrast, the link of uncertainty to export performance through RELQUAL should reveal a different direction, such that greater uncertainty in an export import relationship increases the chances that the exporter experiences lower RELQUAL, with a resulting negative impact on export performance. Thus, we hypothesize the following: H5: RELQUAL mediates the specific assets export performance link. H6: RELQUAL mediates the uncertainty export performance link. We depict the conceptual model in Figure 1. RESEARCH DESIGN AND METHODS Data Collection and Sample Description The sample consisted of 185 responses from garment exporters in Bangladesh identified from the Bangladesh Garment Manufacturers and Ex-

9 158 Transaction Cost Export Performance Link porters Association membership directory. This directory lists 2,917 members, of which 1,862 (64%) are from the Dhaka zone, which contains both the capital and nearby districts. Using this database, we used a simple random sampling procedure in an attempt to collect 500 responses. A reputable survey company undertook the data collection by appointing a group of field investigators. The procedure began with telephone contacts with the firms, asking to speak to the head of the commercial, merchandising, or production unit. The investigator then explained the purpose of the survey and requested the name of a person who would be capable of responding to it. After making an appointment, the investigator visited respondents at their workplaces, providing a cover letter that explained the research; asked for their help in completing the survey; and promised that the results of the research would remain anonymous and would be used for academic purposes only, which should have helped reduce potential nonresponse bias. As suggested by Kumar, Stern, and Anderson (1993, p. 1634), we used a key informant methodology and chose respondents because they are supposedly knowledgeable about the issues being researched and able and willing to communicate about them. As suggested by Campbell (1955) and Mysen, Svensson, and Payan (2011), we checked the respondents knowledge levels with two items: (a) How much do you know about your firm s perspective on the study topics? and (b) How much do you know about specific experiences with importers? The responses to these questions indicated respondents adequate knowledge (averages of 5.6 and 5.8 on a 7-point Likert scale, respectively). From this process, we obtained 185 responses but had to eliminate five because of missing values. The 180 questionnaires that entered our analysis represented a net response rate of 36%, which is satisfactory in comparison with conventional management survey response rates (Menon, Bharadwaj, & Howell, 1996). Most respondents represented merchandising or commercial units (78%) and had worked for the organization for an average of 5 years. In addition, the survey company verified proper data collection procedures by telephoning the respondent for confirmation. To limit our research focus, we asked respondents to name the top importers of their products and answer in relation to this relationship alone. Thus, similar to C. Lages et al. (2005), we analyzed a single product line (garment products) exported to a single destination or group of destinations (i.e., Western markets, mainly in the European Union and the United States) to identify the level of RELQUAL in a specific relationship. Finally, we checked for common method bias using Harman s (1967) single-factor test. Because no single factor emerged that could explain more than 50% of the variance in the variables (Podsakoff, Mackenzie, Lee, & Podsakoff, 2003), common method bias did not appear to be a concern.

10 A. F. M. J. Ahamed et al. 159 Measures The measurement scales came from the prior literature, which we identified during our construction of the conceptual model. The items were either borrowed or slightly modified from previous research and used a Likert scale anchored at 1 (strongly disagree) and 7 (strongly agree; see the Appendix for details). We took five items from Leonidou et al. (2006) to measure uncertainty. Three items from Mysen et al. (2011) served to measure specific assets. Of the RELQUAL focal constructs, we measured satisfaction with a three-item scale adapted from C. Lages et al. (2005) and Skarmeas et al. (2008); for commitment, we used a three-item scale adapted from C. Lages et al. (2005); and to measure trust, we adapted a two-item scale from Ganesan (1994) and Zaheer, McEvily, and Perrone (1998). Empirical studies indicate that the correlations of trust, commitment, and satisfaction are so high that it might not matter which construct gets measured, such that a combined RELQUAL scale might be more appropriate (De Cannière, De Pelsmacker, & Geuens, 2009). Accordingly, we conceptualized RELQUAL as a second-order construct without further statistical analysis. Nine items from Zou et al. (1998) measured the first-order constructs of export performance: financial, strategic, and satisfaction (three items each). The correlations among these three dimensions were high, as were the strength and significance of the path from the indicator to the construct (MacKenzie, Podsakoff, & Jarvis, 2005). Therefore, we confirmed that the second-order construct export performance was strong and significant. Analytical Method Partial least squares (PLS) analysis is an increasingly popular, componentbased structural equation modeling (SEM) approach (Henseler, Ringle, & Sinkovics, 2009). Several rationales exist for using PLS methods, particularly in international marketing research (Henseler et al., 2009). First, PLS path modeling avoids small sample size problems and can be applied in situations when other methods cannot. Second, it makes less stringent assumptions about the distribution of variables and error terms and can handle both reflective and formative measurement models. Third, PLS delivers latent variable scores, that is, proxies of the constructs, measured by one or several indicators (manifest variables). Because we had a relatively small sample size (N = 180) and two second-order constructs (RELQUAL and export performance), we applied PLS to our data set and drew statistical inferences using SmartPLS 2.0 software (Ringle, Wende, & Will, 2005).

11 160 Transaction Cost Export Performance Link TABLE 1 Descriptive Statistics for Construct Measures Variable Specific Assets Uncertainty Commitment Trust Satisfaction Financial Export Performance Strategic Export Performance Export Satisfaction M SD Composite Reliability Average Variance Extracted Notes: Bold figures on the diagonal are the square root of the average variance extracted for the constructs. DATA ANALYSIS AND RESULTS Following the tradition in PLS SEM literature, we refer to outer and inner models instead of adopting the structural and measurement model terminology used in the prior covariance-based SEM (CB-SEM) literature (Henseler et al., 2009). Assessment of the Outer Model Before assessing the quality of the structural model or testing the hypothesized relationships, we needed to establish the internal reliability and validity of our measures. Therefore, we calculated composite reliability (Fornell & Larcker, 1981) and analyzed the outer standardized factor loadings to assess the individual item reliability for each indicator (see the Appendix). We tested for internal consistency using confirmatory factor analysis and Cronbach s alpha coefficients, such that we retained items with factor loadings greater than.50 for further analysis (Hulland, 1999). Because two items associated with the uncertainty construct exhibited factor loadings below the cutoff level, we excluded them. Next we calculated the average variance extracted (AVE) to test for convergent and discriminant validity. As we show in Table 1, all AVE values were greater than.50, and the square root of each construct s AVE exceeded the coefficients for the relationships between that measure and all other constructs (Fornell & Larcker, 1981). Therefore, the items possessed adequate convergent and discriminant validity.

12 A. F. M. J. Ahamed et al. 161 TABLE 2 Measurement Items Item Standardized Factor Loading Cronbach s α The export has strengthened our strategic 0.89 position. The export has significantly increased our 0.85 global market. Satisfaction with export venture.89 The performance of this export has been 0.93 very satisfactory. The export has been very successful The export has fully met our expectations Asset Specificity.87 Our firm has made significant investments in 0.76 resources that are useful only to this importer. We have customized a consequential portion 0.95 of our business in dealing with this importer. We have tailored major parts of our business 0.95 to accommodate the needs of this importer. Uncertainty.65 Existence of high degree of uncertainty a 0.33 Inadequacy of information when making 0.67 decisions Difficulty in monitoring trends a 0.43 Confidence in making future decisions 0.68 (reverse scored) Inaccurate anticipation of acts 0.79 Notes: All standardized factor loadings significant at p <.001 (two-tailed). a Item eliminated because of its low factor loading. Assessment of the Inner Model and Hypothesis Testing To evaluate the inner model and hypotheses, we examined the path coefficients (β), their corresponding p values, and the variance explained (R 2 ). As a measure of predictive power, R 2 values can be interpreted similarly to the values obtained through a multiple regression analysis. For this study, the dependent construct (export performance) reached an R 2 value of.68, which is substantial, and the R 2 value for RELQUAL was.14, which is moderate according to Chin s (1998) classification. To establish mediation and test H5 and H6, we built three models (Baron & Kenny, 1986; Singh, Goolsby, & Rhoads, 1994). Model 1 included specific assets, uncertainty, and export performance; in the absence of the proposed mediating variable (RELQUAL), we tested for the direct effects and thus H2 and H4. In Model 2, we added RELQUAL. Then Model 3 included all of the variables, such that it encompassed all relationships in the direct effects model, the direct effects of specific assets and uncertainty on RELQUAL, and the direct effects of RELQUAL on export performance. Table 2 contains the empirical results for all three models.

13 162 Transaction Cost Export Performance Link TABLE 3 Hypothesis Tests Path Model 1 Model 2 Model 3 Effects Specific assets Export performance.201 (3.467).077(1.470) Uncertainty Export performance.311 (4.648).059(1.048) Specific assets RELQUAL.155 (3.299).156 (3.357) Uncertainty RELQUAL.327 (5.281).324 (5.096) RELQUAL Export performance.785 (14.425) Overall R 2 Export performance RELQUAL Notes: Except where specified, data are path coefficients (t). RELQUAL = relationship quality. p <.001 (two-tailed) In the direct effects Model 1, specific assets exerted a significant positive effect on export performance (β =.201, t = 3.467, p >.05), in support of H2. Furthermore, uncertainty had a significant negative effect on export performance (β =.311, t = 4.648, p >.05), in line with H4. We tested for the mediation effect in three steps (Baron & Kenny, 1986). First, we identified a positive, significant relationship between specific assets (independent variable) and RELQUAL (mediator; β =.155, t = 3.299, p >.05) as well as a significant negative effect between uncertainty (independent variable) and RELQUAL (mediator; β =.327, t = 5.281, p >.05), so we found support for H1 and H3, respectively. Second, RELQUAL had a significant, positive effect on export performance (β =.820, t = , p >.05). Third, the relationships between specific assets and export performance (β =.077, t = 1.470, p <.05) and between uncertainty and export performance (β =.059, t = 1.048, p <.05) both became nonsignificant when we included the mediator, in support of H5 and H6. That is, RELQUAL mediated the specific assets export performance and the uncertainty export performance links. In other words, specific assets and uncertainty (TCE constructs) affected export performance indirectly through RELQUAL (RET construct). DISCUSSION AND CONCLUSIONS This study has sought to investigate how TCE constructs specific assets and uncertainty affect export performance both directly and through RELQUAL, a RET construct. Thus, we propose a meeting point that bridges the two theoretical extremes that appear in the international business literature. Our results suggest that TCE and RET are not competing but rather are complementary theories that can further understanding of how to foster and improve export performance.

14 A. F. M. J. Ahamed et al. 163 Along with this effort, we proposed six hypotheses, as we summarize in Table 2. All six predictions received support in our data. In particular, our finding of a positive and significant relationship between specific assets and RELQUAL is consistent with previous studies (De Vita et al., 2011; Ghani & Khan, 2004; Stump et al., 2002; Zaheer & Venkatraman, 2007). By revealing that RELQUAL has a positive and significant impact on export performance, we also confirm prior findings that suggest a positive impact of relational behavior on interfirm exchanges (Ahamed & Skallerud, 2013; C. Lages et al., 2005; Ural, 2009). By developing and engaging in strong relational bonds, exporters can improve their export performance. These are not the only insights for managers though. Our results also provide deeper insights into the process by which strong relationships enhance export performance, as well as how export managers can strengthen the quality of their relationships with importing exchange partners. In particular, we recommend that exporters tender pledges of specific assets while also working to mitigate any effects of environmental uncertainty. Finally, several research limitations associated with this study suggest some directions for further research. First, in response to calls for more research that tries to link TCE to marketing aspects (Williamson & Ghani, 2012), this study integrates two distinct perspectives on interfirm exchanges into a single framework. As this is the first study to include TCE constructs as antecedents of export performance, we acknowledge that the proposed framework requires further validation in studies that encompass other types of export import relationships and various product categories. Such efforts are required to assess the extent to which our conceptual framework can be generalized. Second, all of the data for this study came from one side of the dyad, namely, the exporters. Additional research should take the importer s perspective to see the other side of the dyad. For example, studies might attempt to confirm whether importers investments in specific assets operate similarly to exporters investments with regard to RELQUAL. Third, beyond its link to export performance, it is necessary to investigate how RELQUAL pertains to past performance and other marketing constructs, such as loyalty and cooperation (L. F. Lages & Jap, 2003; L. F. Lages & Montgomery, 2004). Our research offers some new ideas for studying export import relationships and their antecedents using the unique empirical setting of the garment industry in Bangladesh. Thus, generalizations should be restricted to export import relationships in this industry, though similar relationships mark many export contexts (Leonidou et al., 2006). We speculate that similar results would emerge from other industries, especially exporting industries in other developing economies, but comparative studies of import export relationships are necessary to confirm this prediction.

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19 168 Transaction Cost Export Performance Link Zaheer, A., McEvily, B., & Perrone, V. (1998). Does trust matter? Exploring the effects of interorganizational and interpersonal trust on performance. Organization Science, 9, Zaheer, A., & Venkatraman, N. (2007). Relational governance as an interorganizational strategy: An empirical test of the role of trust in economic exchange. Strategic Management Journal, 16, Zou, S., Taylor, C. R., & Osland, G. E. (1998). The EXPERF scale: A cross-national generalized export performance measure. Journal of International Marketing, 6, TABLE A-1 Item Measurement Items APPENDIX Standardized Factor Loading Cronbach s α Relationship Quality (Second-Order Construct).89 Trust.84 The importer has been frank in dealing 0.93 with us. Our importer is trustworthy Commitment.78 We believe that, in the long run, our 0.89 relationship with the importer will be profitable. Maintaining a long-term relationship with 0.88 this importer is important to us. We are willing to make sacrifices to help 0.72 this importer from time to time. Satisfaction.87 Our association with the importer has 0.87 been highly successful. This importer is a good company to do 0.90 business with. In general, we are satisfied with our 0.90 dealings with this importer. Export Performance (Second-Order Construct).93 Financial performance.88 Our export to this importer has been very 0.89 profitable. The export to this importer has generated 0.93 a high volume of sales. The export has achieved rapid growth Strategic performance.83 The export has improved our global 0.86 competitiveness. (Continued on next page)

20 A. F. M. J. Ahamed et al. 169 TABLE A-1 Measurement Items Item Standardized Factor Loading Cronbach s α The export has strengthened our strategic 0.89 position. The export has significantly increased our 0.85 global market. Satisfaction with export venture.89 The performance of this export has been 0.93 very satisfactory. The export has been very successful The export has fully met our expectations Asset Specificity.87 Our firm has made significant investments in 0.76 resources that are useful only to this importer. We have customized a consequential portion 0.95 of our business in dealing with this importer. We have tailored major parts of our business 0.95 to accommodate the needs of this importer. Uncertainty.65 Existence of high degree of uncertainty a 0.33 Inadequacy of information when making 0.67 decisions Difficulty in monitoring trends a 0.43 Confidence in making future decisions 0.68 (reverse scored) Inaccurate anticipation of acts 0.79 Notes: All standardized factor loadings significant at p <.001 (two-tailed). a Item eliminated because of its low factor loading.