Do more structural holes lead to more risk propagation in R&D networks?

Purpose: The purpose of this paper is twofold: first, to explore how the number of structural holes influences the possibility of risk propagation in R&D networks; and second, to investigate how the specific context of tie strength and common cognition moderate the association between structural holes and risk propagation. Design/methodology/approach: This study focuses on how structural holes influence risk propagation under the specific context of relationship and cognitive dimension by drawing on social capital theory. Risk sharing and risk perception as mediating variables are employed in the proposed conceptual model. The authors issued questionnaires to managers and R&D personnel participating in R&D projects and collaboration in Shanghai and Jiangsu province through e-mail and face to face. The data were used to carry out multiple regression analysis to test hypotheses. Findings: The results show that relationship between structural holes and risk propagation of R&D network is U-shaped. Risk perception and risk sharing partially mediate the relationship between structural holes and risk propagation. Tie strength significantly moderates the relationship between structural holes and risk sharing, but insignificantly moderates the association between structural holes and risk perception. Common cognition significantly moderates the associations between structural holes and risk sharing, and structural holes and risk perception, respectively. Originality/value: This study provides a distinctive theoretical perspective for social capital and risk management. It also offers managers a clear understanding of how to reduce or to avoid risk propagation by jointly leveraging the number of structural holes, tie strength and common cognition.