Learning theories play a prominent role in new theories of competitive advantage. Despite the recent progress in understanding interorganizational learning (inter-firm knowledge sharing), gaps and shortcomings remain. Inter-firm knowledge sharing involves risks and dilemma. Little is known about the characteristics of global supply chain design that would encourage inter-firm knowledge sharing, and how these collaborative activities could lead to improving the long-term performance of the individual companies and the supply chain as a whole. Furthermore, previous studies on inter-firm collaboration mainly looked at operational efficiency as the key performance measurement. Relationship value should be taken as a more critical criterion variable when firms are driven by more demanding customers, global competition, and slow-growth economies. Building from the resource-based view, transaction cost economics, relational exchange view, and political economy paradigm, this study seeks to provide insight to how firms commit their resources to engage in knowledge sharing activities with their overseas supply chain partners, and the implications on horizontal (i.e., cross-border) segmentation pertaining to firms' sourcing and marketing strategy.; Using the extant literature from the fields of marketing, supply chain management, and international business, a theoretical model was constructed and then tested through a Web survey involving 105 supply chain dyads (210 responses) from 4 manufacturers representing 3 industries with facilities located in 19 countries. The survey data were analyzed using structural equation modeling to simultaneously test the 8 hypotheses.; Both the buyers and the sellers in this study shared the consensus that environmental uncertainty, environmental fit, organizational fit, and idiosyncratic investments facilitate inter-firm knowledge sharing in spite of the risks and dilemma associated with such activities. Both sides of the dyad also found the investments in such activities worthwhile, when outcomes were measured by relationship value, explored from the perspectives of both the buyers and the sellers.
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