Exploration and Exploitation in Technology-based Alliance Networks
AbstractAlthough the literature converges regarding the reasons why and how networks of technology alliances are formed, there is still lack of agreement on what constitutes an optimal network structure, once it has been formed. The aim of this paper is to fill this void and to determine what constitutes an optimal network structure for exploration and exploitation within the context of technological innovation. We differentiate among a firm's direct ties, indirect ties and degree of redundancy and analyze their role in the pharmaceutical, chemical and automotive industry. Regarding the role of direct ties, in combination with indirect ties, we find two alternative alliance network structures that are effective for both exploitation and exploration. We also find that redundancy in a firm's alliance network has a positive effect on exploitation. This is not the case for exploration, however, which seems to reveal a new insight into the role of redundancy when firms explore new technological fields. A final point is that our findings remain largely invariant across the three industries, enhancing the generalisability of our results.
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Bibliographic InfoPaper provided by United Nations University, Maastricht Economic and social Research and training centre on Innovation and Technology in its series UNU-MERIT Working Paper Series with number 020.
Date of creation: 2007
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Web page: http://www.merit.unu.edu
Networks; Strategic Alliances; Innovation; Learning;
Find related papers by JEL classification:
- O32 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Management of Technological Innovation and R&D
- O31 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
- D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-07-07 (All new papers)
- NEP-COM-2007-07-07 (Industrial Competition)
- NEP-CSE-2007-07-07 (Economics of Strategic Management)
- NEP-INO-2007-07-07 (Innovation)
- NEP-IPR-2007-07-07 (Intellectual Property Rights)
- NEP-NET-2007-07-07 (Network Economics)
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