A research on the relationship among specific investment type, control mechanisms and overseas knowledge acquisition

Abstract

Abstract: This paper explores the impact of the matching relationship between the specific types of investments (physical specific investment and human specific investment) and control mechanisms on overseas knowledge acquisition among different knowledge complexity scenarios. Applying AMOS 17.0 and SPSS16.0 to test empirically the sample data of 229 Chinese local companies, the results show that:
Firstly, the matching relationship between different types of specific investments and different governance mechanisms is verified through the classification of specific investments. Specifically, the interaction between contractual control and physical specific investment has a positive impact on overseas knowledge acquisition and the interaction between relational control and human specific investment has a positive impact on overseas knowledge acquisition, while unreasonable matching relationship between specific investment and control mechanisms (i.e. contract control v.s. human specific investment; relational control v.s. physical specific investment) on overseas knowledge acquisition is not significant. This result further enriches the study on the protection mechanisms of specific investments in transaction cost theory and helps suppliers to choose different governance mechanisms according to different types of specific investments.
Secondly, through the study of knowledge types in the foundry business, we clarify the different effects of the matching relationship between specific investments and control mechanisms on overseas knowledge under different knowledge complexity. Specifically, the interaction between contract control and physical specific investment is more significant in promoting overseas knowledge acquisition at lower knowledge complexity, while the interaction between relational control and human specific investment is more significant in promoting overseas knowledge acquisition at higher knowledge complexity. This finding suggests that when the knowledge complexity in contemporary industrial services increases with firm upgrading, the effect of contract control and physical specific investment on overseas knowledge acquisition decreases, while the effect of relational control and human specific investment on overseas knowledge acquisition increases.
Thirdly, this result finds that contract control and relationship control are applicable to different types of transactions in the context of transition systems. Specifically, trust-based relationship control can hardly improve the positive impact of physical specific investments on overseas knowledge acquisition, while contract control, which does not rely on social relationships, can help promote the positive impact of physical investments on overseas knowledge acquisition. The above research shows that even though China is still in the process of institutional transformation and the construction of formal systems is not yet complete, contract control still plays an important role in coordinating international cooperative relationships.
Although this paper illustrates the impact of the matching relationship between specific asset types, control mechanisms and knowledge complexity on overseas knowledge acquisition, which helps guide companies to select appropriate control mechanisms based on knowledge complexity and specific asset types, and to get better overseas knowledge acquisition performance. There are still some limitations. First, this paper only considers the impact of physical investment and human capital specific investment on overseas knowledge acquisition. In the future, we should further explore more dimensions of specific investments. Second, this paper only considers the impact of specific investment on overseas knowledge acquisition. Future research can explore whether specific investment, cooperation frequency and uncertainty will have different impact on overseas knowledge acquisition. Third, due to the limitation of data acquisition, the data in this paper uses cross-sections. Using panel data will obtain more valuable research results.

Key words: specific investment, contract control, relational control, knowledge complexity, overseas knowledge acquisition

Wang Lei, Zhu Ying, Wang Shengjun. A research on the relationship among specific investment type, control mechanisms and overseas knowledge acquisition[J]. Science Research Management, 2021, 42(1): 156-167.

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