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Equity Links and Information Acquisition in Biotechnology Alliances

Author

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  • Darren Filson

    (Claremont Graduate University)

  • Rosa Morales

    (Claremont Graduate University)

Abstract

We use a simple model of collaborative innovation to structure an empirical analysis of minority equity links in biotechnology alliances between clients and R&D firms. In the model, an equity link is an investment in information acquisition: it improves the ability of the client to learn about the R&D firm’s ability and the alliance project’s quality. The model generates several testable hypotheses about how the R&D firm’s project characteristics and previous alliances affect the use of equity links in new alliances. We test the hypotheses using a large data set of biotechnology alliances and find empirical support.

Suggested Citation

  • Darren Filson & Rosa Morales, 2001. "Equity Links and Information Acquisition in Biotechnology Alliances," Claremont Colleges Working Papers 2001-24, Claremont Colleges.
  • Handle: RePEc:clm:clmeco:2001-24
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    File URL: http://www.claremontmckenna.edu/rdschool/papers/2001-24.pdf
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    References listed on IDEAS

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    Cited by:

    1. Albert Jolink & Eva Niesten, 2012. "Hybrid Governance," Chapters,in: Handbook on the Economics and Theory of the Firm, chapter 12 Edward Elgar Publishing.
    2. Rick Harbaugh, 2001. "Equity Stakes and Hold-up Problems," Claremont Colleges Working Papers 2001-31, Claremont Colleges.
    3. Abel Lucena, 2009. "The antecedents and innovation consequences of organizational search: empirical evidence for Spain," Working Papers XREAP2009-08, Xarxa de Referència en Economia Aplicada (XREAP), revised Oct 2009.
    4. repec:eee:indorg:v:54:y:2017:i:c:p:37-64 is not listed on IDEAS

    More about this item

    Keywords

    alliance; collaboration; integration; joint venture; technological change;

    JEL classification:

    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

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