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Measuring technological diversification: identifying the effects of patent scale and patent scope

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  • Jennifer H. Chen

    (Nanhua University)

  • Show-Ling Jang

    (National Taiwan University)

  • Sonya H. Wen

    (Tamkang University)

Abstract

Although technological diversification is an important strategic decision for both large and small firms alike, the conventional method of measuring such diversification may well introduce significant scale bias against small- and medium-sized firms. We examine this issue in this study using a sample of 73 Taiwanese integrated-circuit (IC) design firms covering the period from 1995 to 2007 and conclude that the conventional measure of technological diversification reflects the spread or distribution amongst technology classes of a company’s current technology portfolio, and does not capture the incremental expansion in technological scope, or the ‘dynamic act of diversification’, as reflected in our alternative scope measure. Our results suggest clear constraints on the applications made under the conventional index, particularly for firms with small patent scale.

Suggested Citation

  • Jennifer H. Chen & Show-Ling Jang & Sonya H. Wen, 2010. "Measuring technological diversification: identifying the effects of patent scale and patent scope," Scientometrics, Springer;Akadémiai Kiadó, vol. 84(1), pages 265-275, July.
    • Handle: RePEc:spr:scient:v:84:y:2010:i:1:d:10.1007_s11192-009-0143-6
    DOI: 10.1007/s11192-009-0143-6
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    2. Wang, Yuandi & Ning, Lutao & Prevezer, Martha, 2015. "Technological diversification in China from 1986 to 2011: Evidence from patent data," Technological Forecasting and Social Change, Elsevier, vol. 99(C), pages 54-66.
    3. Hyunseok Park & Janghyeok Yoon, 2014. "Assessing coreness and intermediarity of technology sectors using patent co-classification analysis: the case of Korean national R&D," Scientometrics, Springer;Akadémiai Kiadó, vol. 98(2), pages 853-890, February.
    4. Yun Liu & Zhe Yan & Yijie Cheng & Xuanting Ye, 2018. "Exploring the Technological Collaboration Characteristics of the Global Integrated Circuit Manufacturing Industry," Sustainability, MDPI, vol. 10(1), pages 1-23, January.
    5. Sadowski, Bert & Nomaler, Onder & Whalley, Jason, 2016. "Technological Diversification of ICT companies into the Internet of things (IoT): A Patent -based Analysis," 27th European Regional ITS Conference, Cambridge (UK) 2016 148701, International Telecommunications Society (ITS).
    6. Xiaojun Hu & Ronald Rousseau, 2015. "A simple approach to describe a company’s innovative activities and their technological breadth," Scientometrics, Springer;Akadémiai Kiadó, vol. 102(2), pages 1401-1411, February.
    7. Jong-Hyun Kim & Yong-Gil Lee, 2024. "Investigating Technological Advancement Strategies for the Innovation Impact of Alternative Energy Patents," Sustainability, MDPI, vol. 16(2), pages 1-25, January.
    8. Lutao Ning & Martha Prevezer & Yuandi Wang, 2014. "Technological diversification in China: Based on Chinese patent analysis during 1986-2011," Working Papers 55, Queen Mary, University of London, School of Business and Management, Centre for Globalisation Research.
    9. Chieh-Wa Tsai & Tung-Kuan Liu & Po-Wen Hsueh, 2020. "Patent Analysis of High Efficiency Tunneling Oxide Passivated Contact Solar Cells," Energies, MDPI, vol. 13(12), pages 1-16, June.
    10. Zabala-Iturriagagoitia, Jon Mikel & Porto Gómez, Igone & Aguirre Larracoechea, Urko, 2020. "Technological diversification: a matter of related or unrelated varieties?," Technological Forecasting and Social Change, Elsevier, vol. 155(C).

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