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Asymmetric roles of business ties and political ties in product innovation

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  • Wu, Jie

Abstract

This study investigates the asymmetric roles of business ties and political ties in innovation processes. The study posits that business ties strengthen organizational competence and enhance the environmental fit. In contrast, political ties increase the environmental fit but ossify organizational internal routines. The study uses an extensive survey on 766 Chinese firms across multiple sectors to test hypotheses. The empirical results provide strong supports for hypotheses by showing that: (1) business ties have a positive impact on product innovation, indicating that despite different types of business ties, they share common features in enhancing product innovation; (2) political ties have an inverted U-shaped relationship with product innovation, indicating that the positive effect of political ties on product innovation would diminish as the costs of political ties outweigh the benefits.

Suggested Citation

  • Wu, Jie, 2011. "Asymmetric roles of business ties and political ties in product innovation," Journal of Business Research, Elsevier, vol. 64(11), pages 1151-1156.
  • Handle: RePEc:eee:jbrese:v:64:y:2011:i:11:p:1151-1156
    DOI: 10.1016/j.jbusres.2011.06.014
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    References listed on IDEAS

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    1. Dinc, I. Serdar, 2005. "Politicians and banks: Political influences on government-owned banks in emerging markets," Journal of Financial Economics, Elsevier, vol. 77(2), pages 453-479, August.
    2. Chong-En Bai & Jiangyong Lu & Zhigang Tao, 2006. "The Multitask Theory of State Enterprise Reform: Empirical Evidence from China," American Economic Review, American Economic Association, vol. 96(2), pages 353-357, May.
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    6. MARA FACCIO & RONALD W. MASULIS & JOHN J. McCONNELL, 2006. "Political Connections and Corporate Bailouts," Journal of Finance, American Finance Association, vol. 61(6), pages 2597-2635, December.
    7. Huarng, Kun-Huang, 2010. "Essential research in technology management," Journal of Business Research, Elsevier, vol. 63(5), pages 451-453, May.
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    Citations

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    Cited by:

    1. Cheng, Cheng-Feng & Chang, Man-Ling & Li, Chu-Shiu, 2013. "Configural paths to successful product innovation," Journal of Business Research, Elsevier, vol. 66(12), pages 2561-2573.
    2. repec:wsi:ijimxx:v:21:y:2017:i:03:n:s136391961750030x is not listed on IDEAS
    3. repec:eee:jbrese:v:81:y:2017:i:c:p:107-117 is not listed on IDEAS
    4. Ren, Shengce & Eisingerich, Andreas B. & Tsai, Huei-ting, 2015. "Search scope and innovation performance of emerging-market firms," Journal of Business Research, Elsevier, vol. 68(1), pages 102-108.
    5. Wang, Chengqi & Yi, Jingtao & Kafouros, Mario & Yan, Yanni, 2015. "Under what institutional conditions do business groups enhance innovation performance?," Journal of Business Research, Elsevier, vol. 68(3), pages 694-702.
    6. Ma, Xufei & Ding, Zhujun & Yuan, Lin, 2016. "Subnational institutions, political capital, and the internationalization of entrepreneurial firms in emerging economies," Journal of World Business, Elsevier, vol. 51(5), pages 843-854.
    7. White, George O. & Boddewyn, Jean J. & Galang, Roberto Martin N., 2015. "Legal system contingencies as determinants of political tie intensity by wholly owned foreign subsidiaries: Insights from the Philippines," Journal of World Business, Elsevier, vol. 50(2), pages 342-356.
    8. Kamal Sakhdari & Jahangir Yadollahi Farsi, 2016. "Business partners and corporate entrepreneurship in developing countries," International Journal of Management and Enterprise Development, Inderscience Enterprises Ltd, vol. 15(1), pages 61-77.
    9. repec:eee:jbrese:v:83:y:2018:i:c:p:82-96 is not listed on IDEAS
    10. repec:eee:ijrema:v:30:y:2013:i:1:p:36-45 is not listed on IDEAS
    11. repec:eee:intman:v:24:y:2018:i:1:p:1-15 is not listed on IDEAS
    12. repec:spr:manint:v:53:y:2013:i:1:d:10.1007_s11575-012-0162-z is not listed on IDEAS
    13. Nima Heirati & Aron O’Cass, 2016. "Supporting new product commercialization through managerial social ties and market knowledge development in an emerging economy," Asia Pacific Journal of Management, Springer, vol. 33(2), pages 411-433, June.
    14. repec:spr:manint:v:55:y:2015:i:3:d:10.1007_s11575-014-0231-6 is not listed on IDEAS
    15. repec:wsi:ijimxx:v:21:y:2017:i:02:n:s1363919617500190 is not listed on IDEAS
    16. Santos, David Ferreira Lopes & Basso, Leonardo Fernando Cruz & Kimura, Herbert & Kayo, Eduardo Kazuo, 2014. "Innovation efforts and performances of Brazilian firms," Journal of Business Research, Elsevier, vol. 67(4), pages 527-535.
    17. repec:eee:touman:v:61:y:2017:i:c:p:553-561 is not listed on IDEAS
    18. Jie Wu & Xiaoyun Chen, 2012. "Leaders’ social ties, knowledge acquisition capability and firm competitive advantage," Asia Pacific Journal of Management, Springer, vol. 29(2), pages 331-350, June.

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