Are external technology sourcing strategies substitutes or complements? The case of embodied versus disembodied technology acquisition
AbstractThis paper analyzes the choice between different external technology sourcing activities of a firm. On the one hand, the firm can acquire new technology which is embodied in personnel. On the other hand, the firm can obtain new technology disembodied through a licensing agreement or by outsourcing the technology development from an R&D contractor. Building on Cassiman and Veugelers (2006), we test whether embodied and disembodied technology acquisitions are complementary activities or rather behave as substitute technology acquisition alternatives. We find that while internal and external technology acquisition are complementary innovation activities, the actual choice of external technology sourcing between embodied or disembodied modes is substitutive for smaller firms. The evidence for larger firms suggests that different external technology sourcing activities are complementary, but in this case the results are suggestive although not strongly significant.
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Bibliographic InfoPaper provided by IESE Business School in its series IESE Research Papers with number D/672.
Length: 22 pages
Date of creation: 23 Jan 2007
Date of revision:
Embodied & disembodied technology acquisition; complementarity; substitutability;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-05-04 (All new papers)
- NEP-BEC-2007-05-04 (Business Economics)
- NEP-CSE-2007-05-04 (Economics of Strategic Management)
- NEP-ICT-2007-05-04 (Information & Communication Technologies)
- NEP-INO-2007-05-04 (Innovation)
- NEP-IPR-2007-05-04 (Intellectual Property Rights)
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