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Is firm-specific innovation associated with greater value appropriation? The roles of environmental dynamism and technological diversity

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  • Wang, Heli
  • Chen, Wei-Ru

Abstract

This paper extends the resource-based theory of the firm to examine the contingencies that either intensify or reduce the relationship between firm-specific innovation and value appropriation. Based on a large-scale analysis of a sample of US manufacturing firms, we found that greater innovation rents appropriation is associated with an increase in firm specificity of its innovative knowledge. But the positive relationship between firm-specific innovations and firm value appropriation tends to decrease when the product or technology market is highly dynamic. Further, under high environmental dynamism, firms should increase the diversity in their knowledge composition in order to mitigate the risk of value erosion associated with firm-specific innovations.

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  • Wang, Heli & Chen, Wei-Ru, 2010. "Is firm-specific innovation associated with greater value appropriation? The roles of environmental dynamism and technological diversity," Research Policy, Elsevier, vol. 39(1), pages 141-154, February.
  • Handle: RePEc:eee:respol:v:39:y:2010:i:1:p:141-154
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    Cited by:

    1. Chang, Yuan-Chieh & Chen, Min-Nan, 2016. "Service regime and innovation clusters: An empirical study from service firms in Taiwan," Research Policy, Elsevier, vol. 45(9), pages 1845-1857.
    2. Manuel Portugal Ferreira & Fernando Ribeiro Serra & Emerson Maccari, 2013. "When the innovator fails to capture rents from innovation," Working Papers 101, globADVANTAGE, Polytechnic Institute of Leiria.
    3. Lin, Chinho & Chang, Chia-Chi, 2015. "The effect of technological diversification on organizational performance: An empirical study of S&P 500 manufacturing firms," Technological Forecasting and Social Change, Elsevier, vol. 90(PB), pages 575-586.
    4. Prajogo, Daniel I., 2016. "The strategic fit between innovation strategies and business environment in delivering business performance," International Journal of Production Economics, Elsevier, vol. 171(P2), pages 241-249.
    5. Jimmi Normann Kristiansen & Frank Gertsen, 2015. "Is Radical Innovation Management Misunderstood? Problematising The Radical Innovation Discipline," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 19(06), pages 1-23, December.
    6. Annapoornima M. Subramanian & Young Rok Choi & Soo-Hoon Lee & Chang-Chieh Hang, 2016. "Linking technological and educational level diversities to innovation performance," The Journal of Technology Transfer, Springer, vol. 41(2), pages 182-204, April.
    7. repec:kap:jtecht:v:42:y:2017:i:3:d:10.1007_s10961-016-9505-4 is not listed on IDEAS

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