Effects of technological diversity and core technologies on R&D efficiency

Abstract

PurposeThis study investigates the effects of related and unrelated technology diversity on R&D efficiency and how a firm’s unique core technology moderates this relationship. In particular, this study aims to address the research gap in the technological diversity literature by examining whether the effects of related and unrelated technological diversity on R&D efficiency are consistent in the context of R&D-intensive firms.Design/methodology/approachUsing a panel dataset of 516 top R&D investors worldwide from 2012 to 2018, the paper tests hypotheses on how the ambivalence of technological diversity affects R&D efficiency depending on the level of diversity.FindingsUnrelated technological diversity has an inverted U-shaped curve relationship with R&D efficiency, which indicates that there exists an optimal point of unrelated technological diversity. Additionally, core technology plays a contingent role in this relationship by alleviating the volatility of the inverted U-shaped relationship between unrelated technological diversity and R&D efficiency.Originality/valueThis study makes an original contribution to the technological diversity literature by adopting an approach not limited to specific countries or industries, focusing on R&D-intensive contexts. Furthermore, the paper distinguishes the various types of technological diversity, considering that the motivations and strategic objectives underlying technological diversity vary depending on the specific type. This allows researchers to gain a deeper insight into how different types of diversity strategies impact R&D efficiency.