Using the entropy-based patent measure to explore the influences of related and unrelated technological diversification upon technological competences and firm performance

Yu-Shan Chen () and Ke-Chiun Chang
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Yu-Shan Chen: National Taipei University
Ke-Chiun Chang: National Yunlin University of Science and Technology

Scientometrics, 2012, vol. 90, issue 3, No 5, 825-841

Abstract: Abstract This study applies the entropy-based patent measure to explore the influences of related technological diversification (RTD) and unrelated technological diversification (UTD) upon technological competences and firm performance. The results show that RTD has a monotonically positive effect on technological competences and UTD has an inverse U-shaped effect on technological competences. Besides, the results demonstrate that the extent of the positive influence of RTD upon technological competences is better than that of UTD upon technological competences. If American pharmaceutical companies would like to adopt technological diversification, this study suggests that they should undertake RTD, rather than UTD. In addition, this study finds out that technological competences mediate the relationship between firm performance and both of RTD and UTD. Although RTD and UTD cannot significantly influence firm performance directly, they can positively affect firm performance indirectly through technological competences.

Keywords: Entropy measure; Related technological diversification; Unrelated technological diversification; Technological competences; Firm performance (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (19)

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DOI: 10.1007/s11192-011-0557-9

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