R&D investment and innovation performance under vertical partner concentration

Vidya Oruganti, Isabel Maria Bodas Freitas and Jojo Jacob

Industry and Innovation, 2024, vol. 31, issue 10, 1264-1301

Abstract: Vertical exchange partners, both customers and suppliers, are key sources of knowledge about new components, technologies, and markets, exerting a critical influence on firms’ innovation performance. While firms’ reliance on a few suppliers and/or a few customers has become a regularly occurring phenomenon, there is only an insufficient understanding of the effect of vertical partner concentration on the returns to firms’ R&D investments. Building on transaction cost and evolutionary economics theories, we conjecture that vertical partner concentration negatively moderates the relationship between R&D investments and innovation performance. Our analysis is built on a dataset of 768 R&D-active French manufacturing firms derived from two independent and temporally separated surveys, enabling the use of lagged values of the key independent variables. The results reveal that customer concentration, whether accompanied or not by supplier concentration, weakens the positive relationship between R&D investment and innovation performance, but this is not observed in dynamic industry settings.

Date: 2024
References: Add references at CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1080/13662716.2024.2340627 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:indinn:v:31:y:2024:i:10:p:1264-1301

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/CIAI20

DOI: 10.1080/13662716.2024.2340627

Access Statistics for this article

Industry and Innovation is currently edited by Associate Professor Mark Lorenzen

More articles in Industry and Innovation from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().