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Although LBE and LBTI have been supported by extensive literature, it still is not clear what and how EMFs learn through LBE and LBTI. In this study, we highlight the role of human agency by examining how perceived competitive threat from informal firms determines EMFs relative preference for product innovation and process innovation. Based on a World Bank dataset on Chinese manufacturing firms during 2009\u20132011, this study finds firms facing high (vs. low) perceived informal competition which may devote relatively more attention to product innovation than to process innovation after entering into export markets, whereas firms facing high perceived informal competition may pay more attention to process innovation in process of learning by technology import. 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