[go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/a/taf/indinn/v21y2014i1p20-42.html
   My bibliography  Save this article

Business Group Affiliation and R&D

Author

Listed:
  • Enrico Guzzini
  • Donato Iacobucci
Abstract
This paper analyzes whether belonging to a business group enhances firms' propensity for and intensity of R&D based on the greater opportunities to finance and co-ordinate R&D strategies and internalize knowledge spillovers. Compared with the existing literature, this paper has the following novelties: (a) it examines how the organization and diversification of business groups influence the R&D investment of affiliated firms; (b) it analyzes the role of R&D spillovers among affiliated firms; and (c) it distinguishes between propensity for and intensity of R&D. We find that less diversified groups are more likely to centralize R&D, while in more diversified groups firms are more likely to be autonomous. We find that controlled companies are more likely to benefit from knowledge spillovers than firms at the head of the group. Finally, we find that R&D autonomy is significantly associated with both a higher propensity for and intensity of R&D in controlled companies.

Suggested Citation

  • Enrico Guzzini & Donato Iacobucci, 2014. "Business Group Affiliation and R&D," Industry and Innovation, Taylor & Francis Journals, vol. 21(1), pages 20-42, January.
    • Handle: RePEc:taf:indinn:v:21:y:2014:i:1:p:20-42
    DOI: 10.1080/13662716.2014.879253
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/13662716.2014.879253
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/13662716.2014.879253?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Paolo Angelini & Andrea Generale, 2008. "On the Evolution of Firm Size Distributions," American Economic Review, American Economic Association, vol. 98(1), pages 426-438, March.
    2. Veugelers, Reinhilde & Cassiman, Bruno, 2005. "R&D cooperation between firms and universities. Some empirical evidence from Belgian manufacturing," International Journal of Industrial Organization, Elsevier, vol. 23(5-6), pages 355-379, June.
    3. Ishtiaq P. Mahmood & Will Mitchell, 2004. "Two Faces: Effects of Business Groups on Innovation in Emerging Economies," Management Science, INFORMS, vol. 50(10), pages 1348-1365, October.
    4. Marco Becht & Colin Mayer, 2002. "Corporate control in Europe," Revue d'économie politique, Dalloz, vol. 112(4), pages 471-498.
    5. Klevorick, Alvin K. & Levin, Richard C. & Nelson, Richard R. & Winter, Sidney G., 1995. "On the sources and significance of interindustry differences in technological opportunities," Research Policy, Elsevier, vol. 24(2), pages 185-205, March.
    6. Bianco, Magda & Nicodano, Giovanna, 2006. "Pyramidal groups and debt," European Economic Review, Elsevier, vol. 50(4), pages 937-961, May.
    7. repec:ner:ucllon:http://discovery.ucl.ac.uk/17678/ is not listed on IDEAS
    8. Frenz, Marion & Ietto-Gillies, Grazia, 2009. "The impact on innovation performance of different sources of knowledge: Evidence from the UK Community Innovation Survey," Research Policy, Elsevier, vol. 38(7), pages 1125-1135, September.
    9. Godoe, Helge, 2000. "Innovation regimes, R&D and radical innovations in telecommunications," Research Policy, Elsevier, vol. 29(9), pages 1033-1046, December.
    10. Claudio A. Piga & Marco Vivarelli, 2004. "Internal and External R&D: A Sample Selection Approach," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 66(4), pages 457-482, September.
    11. Breschi, Stefano & Lissoni, Francesco, 2001. "Knowledge Spillovers and Local Innovation Systems: A Critical Survey," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 10(4), pages 975-1005, December.
    12. Barca, Fabrizio & Becht, Marco (ed.), 2001. "The Control of Corporate Europe," OUP Catalogue, Oxford University Press, number 9780199247424.
    13. Brusco, Sandro & Panunzi, Fausto, 2005. "Reallocation of corporate resources and managerial incentives in internal capital markets," European Economic Review, Elsevier, vol. 49(3), pages 659-681, April.
    14. Lhuillery, Stéphane & Pfister, Etienne, 2009. "R&D cooperation and failures in innovation projects: Empirical evidence from French CIS data," Research Policy, Elsevier, vol. 38(1), pages 45-57, February.
    15. David J. Teece, 2003. "Towards an Economic Theory of the Multiproduct Firm," World Scientific Book Chapters, in: Essays In Technology Management And Policy Selected Papers of David J Teece, chapter 15, pages 419-446, World Scientific Publishing Co. Pte. Ltd..
    16. Hamelin, Anaïs, 2011. "Small business groups enhance performance and promote stability, not expropriation. Evidence from French SMEs," Journal of Banking & Finance, Elsevier, vol. 35(3), pages 613-626, March.
    17. Vivarelli, Marco & Evangelista, Rinaldo & Pianta, Mario, 1996. "Innovation and employment in Italian manufacturing industry," Research Policy, Elsevier, vol. 25(7), pages 1013-1026, October.
    18. Heitor V. Almeida & Daniel Wolfenzon, 2006. "A Theory of Pyramidal Ownership and Family Business Groups," Journal of Finance, American Finance Association, vol. 61(6), pages 2637-2680, December.
    19. Aghion, Philippe & Tirole, Jean, 1997. "Formal and Real Authority in Organizations," Journal of Political Economy, University of Chicago Press, vol. 105(1), pages 1-29, February.
    20. Tarun Khanna & Yishay Yafeh, 2005. "Business Groups and Risk Sharing around the World," The Journal of Business, University of Chicago Press, vol. 78(1), pages 301-340, January.
    21. Marco Becht & Fabrizio Barca, 2001. "The control of corporate Europe," ULB Institutional Repository 2013/13302, ULB -- Universite Libre de Bruxelles.
    22. Yakov Amihud & Baruch Lev, 1981. "Risk Reduction as a Managerial Motive for Conglomerate Mergers," Bell Journal of Economics, The RAND Corporation, vol. 12(2), pages 605-617, Autumn.
    23. Raquel Ortega-Argilés & Marco Vivarelli & Peter Voigt, 2009. "R&D in SMEs: a paradox?," Small Business Economics, Springer, vol. 33(1), pages 3-11, June.
    24. Pavitt, Keith, 1984. "Sectoral patterns of technical change: Towards a taxonomy and a theory," Research Policy, Elsevier, vol. 13(6), pages 343-373, December.
    25. Stefano Breschi & Francesco Lissoni, 2001. "articles: Localised knowledge spillovers vs. innovative milieux: Knowledge "tacitness" reconsidered," Papers in Regional Science, Springer;Regional Science Association International, vol. 80(3), pages 255-273.
    26. Flatten, Tessa C. & Engelen, Andreas & Zahra, Shaker A. & Brettel, Malte, 2011. "A measure of absorptive capacity: Scale development and validation," European Management Journal, Elsevier, vol. 29(2), pages 98-116, April.
    27. Stephane Lhuillery, 2011. "The impact of corporate governance practices on R&D efforts: a look at shareholders' rights, cross-listing, and control pyramid," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 20(5), pages 1475-1513, October.
    28. Stephane Lhuillery & Etienne Pfister, 2011. "Do Firms Know the Scope of their R&D Network? An Empirical Investigation of the Determinants of Network Awareness on French Survey Data," Industry and Innovation, Taylor & Francis Journals, vol. 18(1), pages 105-130.
    29. Giulio Cainelli & Donato Iacobucci, 2009. "Business groups and the boundaries of the firm," Working Papers 0905, c.MET-05 - Centro Interuniversitario di Economia Applicata alle Politiche per L'industria, lo Sviluppo locale e l'Internazionalizzazione.
    30. Teece, David J., 1980. "Economies of scope and the scope of the enterprise," Journal of Economic Behavior & Organization, Elsevier, vol. 1(3), pages 223-247, September.
    31. Stefano Breschi & Francesco Lissoni, 2009. "Mobility of skilled workers and co-invention networks: an anatomy of localized knowledge flows," Journal of Economic Geography, Oxford University Press, vol. 9(4), pages 439-468, July.
    32. Sea-Jin Chang & Chi-Nien Chung & Ishtiaq P. Mahmood, 2006. "When and How Does Business Group Affiliation Promote Firm Innovation? A Tale of Two Emerging Economies," Organization Science, INFORMS, vol. 17(5), pages 637-656, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ghosh, Saibal, 2016. "Banker on board and innovative activity," Journal of Business Research, Elsevier, vol. 69(10), pages 4205-4214.
    2. Carboni, Oliviero A. & Medda, Giuseppe, 2021. "External R&D and product innovation: Is over-outsourcing an issue?," Economic Modelling, Elsevier, vol. 103(C).
    3. Kerai, Anita & Sharma, Sunil, 2015. "Innovation in Business Group Firms: Influence of Network Diversity," IIMA Working Papers WP2015-03-26, Indian Institute of Management Ahmedabad, Research and Publication Department.
    4. OA Carboni & G Medda, 2017. "Do Investment and Innovation Boost Export? An Analysis on European Firms," Working Paper CRENoS 201708, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
    5. Giuseppe Medda, 2020. "External R&D, product and process innovation in European manufacturing companies," The Journal of Technology Transfer, Springer, vol. 45(1), pages 339-369, February.
    6. Tiziana Di Cimbrini & Fabrizio Maturo & Stefania Migliori & Francesco Paolone, 2018. "Innovation Propensity in the Specialized Suppliers Industry," International Business Research, Canadian Center of Science and Education, vol. 11(10), pages 129-148, October.
    7. G Medda & OA Carboni, 2019. "External R&D Acquisition and Product Innovation," Working Paper CRENoS 201906, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
    8. Surenderrao Komera & P. J. Jijo Lukose & Subash Sasidharan, 2018. "Does business group affiliation encourage R&D activities? Evidence from India," Asia Pacific Journal of Management, Springer, vol. 35(4), pages 887-917, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Enrico Guzzini & Donato Iacobucci, 2012. "Business group affiliation and R&D propensity," Working Papers 1203, c.MET-05 - Centro Interuniversitario di Economia Applicata alle Politiche per L'industria, lo Sviluppo locale e l'Internazionalizzazione.
    2. Enrico Guzzini & Donato Iacobucci, 2014. "Ownership as R&D incentive in business groups," Small Business Economics, Springer, vol. 43(1), pages 119-135, June.
    3. Enrico Guzzini & Donato Iacobucci, 2012. "Firm size and unrelated diversification. An empirical test on the ‘survivalist hypothesis’," Working Papers 1207, c.MET-05 - Centro Interuniversitario di Economia Applicata alle Politiche per L'industria, lo Sviluppo locale e l'Internazionalizzazione.
    4. Almeida, Heitor & Park, Sang Yong & Subrahmanyam, Marti G. & Wolfenzon, Daniel, 2011. "The structure and formation of business groups: Evidence from Korean chaebols," Journal of Financial Economics, Elsevier, vol. 99(2), pages 447-475, February.
    5. Arora, Ashish & Cohen, Wesley M. & Walsh, John P., 2016. "The acquisition and commercialization of invention in American manufacturing: Incidence and impact," Research Policy, Elsevier, vol. 45(6), pages 1113-1128.
    6. Mike Burkart & Samuel Lee, 2008. "One Share - One Vote: the Theory," Review of Finance, European Finance Association, vol. 12(1), pages 1-49.
    7. Heitor Almeida & Sang Yong Park & Marti Subrahmanyam & Daniel Wolfenzon, 2009. "The Structure and Formation of Business Groups: Evidence from Korean Chaebols," NBER Working Papers 14983, National Bureau of Economic Research, Inc.
    8. Becht, Marco & Bolton, Patrick & Roell, Ailsa, 2003. "Corporate governance and control," Handbook of the Economics of Finance, in: G.M. Constantinides & M. Harris & R. M. Stulz (ed.), Handbook of the Economics of Finance, edition 1, volume 1, chapter 1, pages 1-109, Elsevier.
    9. Randall Morck, 2011. "Finance and Governance in Developing Economies," Annual Review of Financial Economics, Annual Reviews, vol. 3(1), pages 375-406, December.
    10. Karle, H. & Klein, T.J. & Stahl, K.O., 2011. "Ownership and Control in a Competitive Industry," Other publications TiSEM 75fbaeb6-c5b2-498b-93b9-e, Tilburg University, School of Economics and Management.
    11. Claessens, Stijn & Fan, Joseph P.H. & Lang, Larry H.P., 2006. "The benefits and costs of group affiliation: Evidence from East Asia," Emerging Markets Review, Elsevier, vol. 7(1), pages 1-26, March.
    12. Yafeh, Yishay & Kandel, Eugene & ,, 2013. "The Great Pyramids of America: A Revised History of US Business Groups, Corporate Ownership and Regulation, 1930-1950," CEPR Discussion Papers 9759, C.E.P.R. Discussion Papers.
    13. Ingrid-Mihaela Dragotă & Andreea Curmei-Semenescu & Raluca Moscu, 2020. "CEO Diversity, Political Influences, and CEO Turnover in Unstable Environments: The Romanian Case," JRFM, MDPI, vol. 13(3), pages 1-22, March.
    14. Martynova, M. & Renneboog, L.D.R., 2006. "Mergers and Acquisitions in Europe," Other publications TiSEM 531d24e9-4f1e-4df3-80db-d, Tilburg University, School of Economics and Management.
    15. Martynova, M. & Renneboog, L.D.R., 2006. "The Performance of the European Market for Corporate Control : Evidence from the 5th Takeover Wave," Discussion Paper 2006-118, Tilburg University, Center for Economic Research.
    16. Martynova, M. & Renneboog, L.D.R., 2005. "Takeover Waves : Triggers, Performance and Motives," Other publications TiSEM ed134639-33ef-4720-9935-e, Tilburg University, School of Economics and Management.
    17. Tarun Khanna & Yishay Yafeh, 2007. "Business Groups in Emerging Markets: Paragons or Parasites?," Journal of Economic Literature, American Economic Association, vol. 45(2), pages 331-372, June.
    18. Vikas Mehrotra & Randall Morck & Jungwook Shim & Yupana Wiwattanakantang, 2010. "Must Love Kill the Family Firm?," NBER Working Papers 16340, National Bureau of Economic Research, Inc.
    19. Martynova, Marina & Renneboog, Luc, 2008. "A century of corporate takeovers: What have we learned and where do we stand?," Journal of Banking & Finance, Elsevier, vol. 32(10), pages 2148-2177, October.
    20. Wandel, Jürgen, 2011. "Integrierte Strukturen im Agrar- und Ernährungssektor Russlands: Entstehungsgründe, Funktionsweise, Entwicklungsperspektiven und volkswirtschaftliche Auswirkungen. Band I und II," Studies on the Agricultural and Food Sector in Transition Economies, Leibniz Institute of Agricultural Development in Transition Economies (IAMO), volume 63, number 63.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:indinn:v:21:y:2014:i:1:p:20-42. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/CIAI20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.