DIMINISHING RETURNS TO R&amp;D INVESTMENT ON INNOVATION IN MANUFACTURING SMEs: DO THE TECHNOLOGICAL INTENSITY OF INDUSTRY MATTER?

Kim, KonShik

doi:10.1142/s1363919618500561

Cited by 13 publications

(16 citation statements)

References 64 publications

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…In view of the foregoing, we therefore lend support to the strand of literature that emphasizes that in cross-border deals, industry does matter (Datta et al , 2005; Kim, 2018; Rajagopalan and Datta, 1996; Singal, 2014; Su, 2015; Perrons and Platts, 2005; Yang et al , 2007). Prior research has shown that industry is an important variable affecting CEO characteristics (Rajagopalan and Datta, 1996), organizational learning (Weerawardena et al , 2006) and patent registration (Kim, 2018). There is further literature on capital markets (Merkley et al , 2017), stakeholder management (Griffin and Koerber, 2006), labor productivity (Datta et al , 2005) and earnings management (He and Yang, 2014).…”

Section: Discussionsupporting

confidence: 65%

Formal institutional uncertainty and equity sought on foreign market entry: does industry matter?

Ahmed

Bebenroth

Hennart

2020

RIBS

View full text Add to dashboard Cite

Purpose This study aims to examine how the effect of host country formal institutional uncertainty on the percentage of equity sought in cross-border acquisitions (CBAs) is moderated by the host country industry (i.e. targets from the technology versus those from the non-technology industry). Design/methodology/approach This study is based upon the legitimacy perspective of institutional theory and uses Tobit regression analysis on a sample of 1,340 CBAs. Findings Results show that cross-border acquirers prefer a lower equity level for targets in institutionally less developed countries and that this negative effect of the host country institutional risk on the equity percentage sought is more pronounced for technology-based targets. Research limitations/implications Three major limitations of the study are as follows: The data were collected from only Japanese acquirers. The study measured formal institutional uncertainty by applying only secondary data. The study used the Bloomberg Industry Classification Systems, instead of the Standard Industry Classification that has been used widely in prior studies. Practical implications This study shows that the industry selected has a bearing on equity sought in CBAs. Investing in institutionally less developed countries is particularly challenging when the targets of acquisition are in the technology industry. Originality/value To the best of the authors’ knowledge, this is the first study that investigates the moderating effects of an industry on the relationship between host country formal institutional uncertainty and the percentage of equity sought in CBAs.

show abstract

Section: Discussionsupporting

confidence: 65%

Formal institutional uncertainty and equity sought on foreign market entry: does industry matter?

Ahmed

Bebenroth

Hennart

2020

RIBS

View full text Add to dashboard Cite

show abstract

“…As a result, product quality in a market with spillovers depends not only on producer's individual product R&D efforts, but also on the product R&D efforts put by producer's rivals. Function The assumption that the marginal returns on R&D are decreasing has its empirical base, e.g., in Scherer (1980), Griliches (1998) or Kim (2018). According to Kamien and colleagues (1992)…”

Section: The Model Of Firm's Product Innovation In Oligopoly With Primentioning

confidence: 99%

COOPERATIVE AND NON-COOPERATIVE R&D IN PRODUCT INNOVATION AND FIRM PERFORMANCE

Karbowski

2019

Journal of Business Economics and Management

View full text Add to dashboard Cite

The aim of this article is to investigate the impacts of cooperative and non-cooperative R&D strategies on product innovation and firm performance. Based on the industrial economics literature and the optimisation model, R&D competition, R&D cartelisation, and full industry cartelisation strategies of firms operating on a market with differentiated goods and simultaneous price and quality competition are considered. It is showed that R&D cartelisation entails a loss of firm’s product innovation compared with R&D competition. However, profit-maximising firms do not prefer the R&D competition strategy. They prefer to pursue either R&D cartelisation or full industry cartelisation strategies, depending on the elasticity of demand with respect to the firm’s investment in R&D. The social cost of R&D cartelisation is a loss of product innovation, and the social cost of full industry cartelisation is both the loss of product innovation and the loss of consumer surplus due to a relatively high price and low output of the final product. The latter results carry significant implications for the modern business and public policy.

show abstract

“…Again, there is much evidence of improvement and then diminishing returns from R&D intensity (Kim, 2018), and this holds true for SMEs whose activities span national boundaries (Booltink & Saka-Helmhout, 2018). Hence, this would suggest that taking account of R&D spend would not significantly change the inverted U-shaped relationship between diversification and credit scores.…”

Section: Additional Testsmentioning

confidence: 98%

The impact of international diversification on credit scores: Evidence from the UK

Halabi

Alshehabi

Wood

et al. 2021

International Business Review

View full text Add to dashboard Cite

Despite the great deal of previous research into international diversification, we know little about the impact of international diversification on firms' credit scores. Drawing upon the resource-based view and transaction cost economics, we examine the relationship between international diversification and credit scores by using a large sample of 6,557 UK firms between 2016 and 2017. We find an inverted U-shaped relationship between international diversification and firms' credit scores, indicating that firm credit score is initially positive but eventually levels off and becomes negative as international diversification increases. In addition, we find that R&D intensity positively moderates the relationship between international diversification and credit score, implying that the credit scores of highly diversified firms improve as they increase their investment in R&D. Further analysis suggests that a firm's credit score becomes less dependent on international diversification for large firms, firms in concentrated industries, firms in the manufacturing sector, and firms distant from key metropolitan areas, such as London.

show abstract

DIMINISHING RETURNS TO R&D INVESTMENT ON INNOVATION IN MANUFACTURING SMEs: DO THE TECHNOLOGICAL INTENSITY OF INDUSTRY MATTER?

Cited by 13 publications

References 64 publications

Formal institutional uncertainty and equity sought on foreign market entry: does industry matter?

Formal institutional uncertainty and equity sought on foreign market entry: does industry matter?

COOPERATIVE AND NON-COOPERATIVE R&D IN PRODUCT INNOVATION AND FIRM PERFORMANCE

The impact of international diversification on credit scores: Evidence from the UK

Contact Info

Product

Resources

About