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Abstract

The forest sector and the global financial crisis (GFC) provide a unique setting for investigating the relationships among market orientation, innovativeness and firm performance. While most of the extant literature suggests that market orientation helps a firm build its innovativeness, we suggest that in the production oriented forest sector, especially when reacting to the crisis, being innovative allows a production oriented firm to develop a market orientation. Using data from 142 US-based forest sector manufacturing firms, we find that some types of innovativeness have a positive effect on the dimensions of market orientation. Process & business systems innovativeness positively impact firm performance suggesting that this relationship holds regardless of business cycles or the general state of the economy. We also find that market orientation does not positively impact firm performance, which is in contrast to the majority of the extant literature.