The rise of regional trade agreements (RTAs) has profoundly reshaped the international trade environment. While these agreements lower tariff barriers, they also increase production costs and domestic competition. Our research explores which strategic resources allow firms to gain a competitive advantage in the liberalized market dynamics of increasing RTAs. Using data from Indian and US firms, we discover that firms employ distinct portfolios of strategic resources to achieve competitive advantage. A key finding is that firms that successfully adapt to these evolving trade conditions also demonstrate greater resilience against local macroeconomic instability. This work provides two primary contributions. First, it offers a more insightful and comprehensive framework for identifying the true ‘winners’ of trade liberalization. Second, it advances the resource-based view (RBV) by showing how operational capabilities can be cultivated into new strategic assets that provide sustainable competitive advantage.
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