Geographically Dispersed Technological Capability Building and MNC Innovative Performance: The Role of Intra-firm Flows of Newly Absorbed Knowledge

Feng Zhang, Guohua Jiang, John A. Cantwell

Research output: Contribution to journalArticle

2 Citations (Scopus)

Abstract

This study identifies key mechanisms linking multinationality with the knowledge advantages of multinational corporations (MNCs). These mechanisms are the absorption of new knowledge by one individual MNC unit and the subsequent flows of such newly absorbed knowledge to other geographically distant units of the same firm. The intra-MNC and inter-unit flows of such newly absorbed knowledge include exchanges between a parent and its overseas subsidiaries and those between subsidiaries. Through analyzing the U.S. patent data of the world's largest firms in the electrical equipment industry, our study shows that those two mechanisms are complementary in affecting MNC innovative performance. More notably, given the geographically dispersed new knowledge absorption within an MNC, only the flows of the newly absorbed knowledge between the parent and subsidiaries, in contrast to those between subsidiaries, are positively associated with MNC innovative performance. This study contributes to the MNC literature. Managerial implications are also discussed.

Original languageEnglish (US)
Article number100669
JournalJournal of International Management
Volume25
Issue number3
DOIs
StatePublished - Sep 1 2019

Fingerprint

Innovative performance
Multinational corporations
Technological capability
Subsidiaries
Large firms
Patent data
Industry studies
Multinationality
Knowledge exchange

All Science Journal Classification (ASJC) codes

  • Business and International Management
  • Finance
  • Strategy and Management

Cite this

@article{9b301a05722748388e6459de05d49c9a,
title = "Geographically Dispersed Technological Capability Building and MNC Innovative Performance: The Role of Intra-firm Flows of Newly Absorbed Knowledge",
abstract = "This study identifies key mechanisms linking multinationality with the knowledge advantages of multinational corporations (MNCs). These mechanisms are the absorption of new knowledge by one individual MNC unit and the subsequent flows of such newly absorbed knowledge to other geographically distant units of the same firm. The intra-MNC and inter-unit flows of such newly absorbed knowledge include exchanges between a parent and its overseas subsidiaries and those between subsidiaries. Through analyzing the U.S. patent data of the world's largest firms in the electrical equipment industry, our study shows that those two mechanisms are complementary in affecting MNC innovative performance. More notably, given the geographically dispersed new knowledge absorption within an MNC, only the flows of the newly absorbed knowledge between the parent and subsidiaries, in contrast to those between subsidiaries, are positively associated with MNC innovative performance. This study contributes to the MNC literature. Managerial implications are also discussed.",
author = "Feng Zhang and Guohua Jiang and Cantwell, {John A.}",
year = "2019",
month = "9",
day = "1",
doi = "10.1016/j.intman.2019.04.002",
language = "English (US)",
volume = "25",
journal = "Journal of International Management",
issn = "1075-4253",
publisher = "Elsevier Inc.",
number = "3",

}

Geographically Dispersed Technological Capability Building and MNC Innovative Performance : The Role of Intra-firm Flows of Newly Absorbed Knowledge. / Zhang, Feng; Jiang, Guohua; Cantwell, John A.

In: Journal of International Management, Vol. 25, No. 3, 100669, 01.09.2019.

Research output: Contribution to journalArticle

TY - JOUR

T1 - Geographically Dispersed Technological Capability Building and MNC Innovative Performance

T2 - The Role of Intra-firm Flows of Newly Absorbed Knowledge

AU - Zhang, Feng

AU - Jiang, Guohua

AU - Cantwell, John A.

PY - 2019/9/1

Y1 - 2019/9/1

N2 - This study identifies key mechanisms linking multinationality with the knowledge advantages of multinational corporations (MNCs). These mechanisms are the absorption of new knowledge by one individual MNC unit and the subsequent flows of such newly absorbed knowledge to other geographically distant units of the same firm. The intra-MNC and inter-unit flows of such newly absorbed knowledge include exchanges between a parent and its overseas subsidiaries and those between subsidiaries. Through analyzing the U.S. patent data of the world's largest firms in the electrical equipment industry, our study shows that those two mechanisms are complementary in affecting MNC innovative performance. More notably, given the geographically dispersed new knowledge absorption within an MNC, only the flows of the newly absorbed knowledge between the parent and subsidiaries, in contrast to those between subsidiaries, are positively associated with MNC innovative performance. This study contributes to the MNC literature. Managerial implications are also discussed.

AB - This study identifies key mechanisms linking multinationality with the knowledge advantages of multinational corporations (MNCs). These mechanisms are the absorption of new knowledge by one individual MNC unit and the subsequent flows of such newly absorbed knowledge to other geographically distant units of the same firm. The intra-MNC and inter-unit flows of such newly absorbed knowledge include exchanges between a parent and its overseas subsidiaries and those between subsidiaries. Through analyzing the U.S. patent data of the world's largest firms in the electrical equipment industry, our study shows that those two mechanisms are complementary in affecting MNC innovative performance. More notably, given the geographically dispersed new knowledge absorption within an MNC, only the flows of the newly absorbed knowledge between the parent and subsidiaries, in contrast to those between subsidiaries, are positively associated with MNC innovative performance. This study contributes to the MNC literature. Managerial implications are also discussed.

UR - http://www.scopus.com/inward/record.url?scp=85064976929&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=85064976929&partnerID=8YFLogxK

U2 - 10.1016/j.intman.2019.04.002

DO - 10.1016/j.intman.2019.04.002

M3 - Article

AN - SCOPUS:85064976929

VL - 25

JO - Journal of International Management

JF - Journal of International Management

SN - 1075-4253

IS - 3

M1 - 100669

ER -