The impact of international diversification on innovation performance of firms in emerging countries: The moderating role of ownership structure

Abstract

Abstract: International diversification has emerged as an important strategy for firms in emerging countries to fulfill innovation catch-up. However, prior research largely ignores the mechanism of international diversification on innovation performance of firms in emerging countries. Integrating the organizational learning and institution-based theory, this study aims to examine how international diversification can be beneficial to firm's innovation performance based on survey data from samples of manufacturing firms in China. The result shows that international diversification is positively related to innovation performance. We also find that the positive relationship between international diversification and innovation performance is stronger when firms are taken an ownership interest by foreign firms, and is not significant when firms are state-controlled. The study results will have significant theoretical and practical implications to the internationalization of the enterprises in emerging countries.

Key words: emerging countries, international diversification, ownership structure, foreign partner ownership, state ownership

CLC Number:

F270.3

Wu Hang, Chen Jin, Zheng Xiaoyong. The impact of international diversification on innovation performance of firms in emerging countries: The moderating role of ownership structure[J]. Science Research Management, 2014, 35(11): 77-83.

References

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