IDEAS home Printed from https://ideas.repec.org/a/eee/techno/v131y2024ics0166497224000233.html
   My bibliography  Save this article

Absorptive capacity versus competency trap: Experiential knowledge and investment in emerging technologies

Author

Listed:
  • Mu, Wen
  • Jiang, Xu

Abstract

Because of the radical novelty of emerging technologies, investing in such technologies brings high risk and great uncertainty. Whether investors’ experiential knowledge encourages or discourages investment in emerging technologies remains under investigation. Juxtaposing the “absorptive capacity” and “competency trap” perspectives, this study proposes a pair of competing hypotheses regarding the influence of experiential knowledge on investor decision-making in emerging technologies. Specifically, we contend that experiential knowledge stimulates investment in emerging technologies based on the absorptive capacity perspective. Meanwhile, drawing on the competency trap perspective, we also argue that experiential knowledge may discourage investment in emerging technologies. Empirical evidence from blockchain-related funding rounds reveals that experiential knowledge negatively influences investment in emerging technologies, which is consistent with the competency trap perspective. We also discover that investor reputation and investor status exacerbate the competency trap implications. Overall, this study sheds light on investment in emerging technologies, the theoretical dilemma of experiential learning, as well as decision-making under uncertainty and ambiguity.

Suggested Citation

  • Mu, Wen & Jiang, Xu, 2024. "Absorptive capacity versus competency trap: Experiential knowledge and investment in emerging technologies," Technovation, Elsevier, vol. 131(C).
    • Handle: RePEc:eee:techno:v:131:y:2024:i:c:s0166497224000233
    DOI: 10.1016/j.technovation.2024.102973
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0166497224000233
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.technovation.2024.102973?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:techno:v:131:y:2024:i:c:s0166497224000233. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.sciencedirect.com/science/journal/01664972 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.