Distinguishing between appropriability and appropriation: A systematic review and a renewed conceptual framing

Abstract

This study systematically reviews 200 articles published over the past three decades to reveal how appropriability and appropriation have been explained and how those perspectives resonate with developments in the innovation environment. Our results show that despite the extensive stream of literature, little effort has been made to systematically advance theory on appropriability and appropriation. Based on and extending prior literature, we propose a conceptual framing that distinguishes appropriability and appropriation, and that explains how innovating organizations build their readiness to benefit from innovation and how they realize that potential. We outline appropriability as the potential to benefit from an innovation, which accrues through instruments of appropriability: isolating appropriability mechanisms and complementary assets; and appropriation as the realization of that potential, which manifests in private and social benefits when the instruments are employed in processes for exclusion, leverage, or disclosure. We highlight the strategic importance of aligning these elements and appropriability conditions in realizing appropriation outcomes. The paper closes with a discussion on the framework's applications and relevant future research avenues.

Unveiling the relationships among intellectual property strategies, protection mechanisms and outbound open innovation

“…We observe a close conceptual link between the defensive IPS and Hurmelinna‐Laukkanen and Yang's (2022) ‘exclusion‐oriented process’. Indeed, they both describe firms aiming to protect IP with a proprietary approach and deter knowledge spillovers.…”

“…Among these studies, Alexy et al (2009) suggested how to adapt IPSs based on the OI environment; Bogers (2011) focused on when an ‘open knowledge exchange’ should be preferred to a more protective ‘layered collaboration scheme’; while Peters et al (2013) discussed how and why firms should combine patenting and strategic disclosure activities. Very recently, Hurmelinna‐Laukkanen and Yang (2022) emphasized how firms should be equipped with a coherent appropriation strategy to benefit from their innovations.…”

“…As Leone (2016) While most of the literature on IP is still dominated by legal aspects (Chesbrough & Ghafele, 2014), many OI scholars recognized the importance of IP and studied it from a managerial perspective, as mentioned in the previous subsections. Nonetheless, IPSs received very limited attention (e.g., Alexy et al, 2009;Fisher & Oberholzer-Gee, 2013;Grzegorczyk, 2020;Hurmelinna-Laukkanen & Yang, 2022). In addition, several other authors mentioned IPSs in their studies but rather focused on IPPMs (e.g., Brem et al, 2017;Lee et al, 2018;Teixeira & Ferreira, 2019).…”

“…The relationship between IPPMs and outbound OI could be framed in the appropriation versus appropriability dichotomy. Indeed, appropriability describes ‘an innovator's potential to benefit from an innovation’, which would be leveraged by ‘instruments of appropriability’ (including IPPMs) (Hurmelinna‐Laukkanen & Yang, 2022). However, appropriation, which describes the realization of the appropriability potential in terms of private and social returns, is by no means guaranteed.…”

“…Indeed, it depends on many contextual and situational factors and the choice of the appropriability mechanisms. Hence, Hurmelinna‐Laukkanen and Yang (2022) emphasized the importance of defining an appropriation strategy to align appropriability instruments and appropriation process to benefit from innovation.…”