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See You in Your Backyard: Multipoint Contact, Firm’s Capacity and Capability, and Technological Expansion

Author

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  • You-Ta Chuang

    (School of Administrative Studies, York University, Toronto, Ontario M3J 1P3, Canada)

  • David H. Weng

    (Department of Management, Mihaylo College of Business and Economics, California State University, Fullerton, Fullerton, California 92831)

  • Chia-Hung Wu

    (College of Management, Yuan Ze University, Taoyuan City, Taiwan 320)

  • Kelly Thomson

    (School of Administrative Studies, York University, Toronto, Ontario M3J 1P3, Canada)

Abstract

Past studies of multipoint competition have mainly focused on the effect of multipoint contact in product markets on firm competitive behaviors in those markets only. Our study advances this literature by examining how multipoint contact in product markets affects a firm’s expansion into a rival’s technological areas. We further investigate the factors that moderate the proposed effect. Our analyses suggest that the degree of multipoint contact between a firm and a rival in product markets has an inverted U-shaped relationship with the degree of the firm’s expansion into the rival’s technological areas (patent classes). Furthermore, the firm’s capacity (market share) and capability (status in terms of technological development) relative to the rival’s have different moderating effects on the relationship between multipoint contact in product markets and the firm’s expansion into the rival’s technological areas. Our findings contribute to the literatures on multipoint contact, competitive dynamics, and firm technology strategies.

Suggested Citation

  • You-Ta Chuang & David H. Weng & Chia-Hung Wu & Kelly Thomson, 2023. "See You in Your Backyard: Multipoint Contact, Firm’s Capacity and Capability, and Technological Expansion," Strategy Science, INFORMS, vol. 8(1), pages 85-102, March.
    • Handle: RePEc:inm:orstsc:v:8:y:2023:i:1:p:85-102
    DOI: 10.1287/stsc.2022.0174
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