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Determinants of Demand for Technology in Relationships with Complementary Assets among Japanese Firms

Masayo Kani and Kazuyuki Motohashi ()

No DP-2016-38, Working Papers from Economic Research Institute for ASEAN and East Asia (ERIA)

Abstract: There has been growing interest in open innovation, where firms create value by combining internal and external ideas. Technology insourcing, however, has not been satisfactorily investigated in the empirical literature compared to technology outsourcing. In this paper, we examine the determinants of external technology sourcing by the type of counterpart in the new product development (NPD) process. We use a novel dataset at the product level, compiled by the Research Institute of Economy, Trade and Industry in 2011. We distinguish whether the technology partner is also a business partner, such as a supplier or customer. Our findings show that when the technology partner is not a business partner, patents play an important role in moderating the transaction costs in a partnership. On the other hand, when the technology partner is also a business partner, we find cospecialisation of technology and its complementary assets with the partner firm.

Keywords: technology sourcing; co-specialisation; complementary assets; division of innovative labour (search for similar items in EconPapers)
JEL-codes: D22 L22 O32 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-bec, nep-knm, nep-sbm and nep-tid
Date: 2017-03
References: View references in EconPapers View complete reference list from CitEc
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