This paper examines how a radical technological innovation affects alliance formation of firms and subsequent network structures. We use longitudinal data of interfirm R&D collaborations in the biopharmaceutical industry in which a new technological regime is established. Our findings suggest...

When inter-firm alliance contracts are inevitably incomplete and include interdependent, though to some extent non-contractible, activities, contracting parties can device coordination mechanisms that both facilitate guidance of the alliance through communication and promote mutual adaptability...

I argue that incumbent firms may adapt to a radical innovation through interfirm cooperation with new entrants. In particular, I suggest that incumbent firms may leverage their pre-innovation complementary assets via exploitation alliances with new entrants. Thus, exploitation alliances are...

The point of departure is a competence-destroying technological discontinuity. We posit that the type of complementary assets (generic vs. specialized) needed to commercialize the new technology is critical in determining the industry- and firm-level performance in the post-discontinuity time...

We use a simple model of collaborative innovation to structure an empirical analysis of minority equity links in biotechnology alliances between clients and R&D firms. In the model, an equity link is an investment in information acquisition: it improves the ability of the client to learn about...

The interaction between product market competition, R&D investment, and the financing choices of R&D-intensive firms on the development of innovative products is only partially understood. To motivate empirical hypotheses about this interaction, we develop a model which predicts that as...

What is the interaction between competition, R&D investments, and the financing choices of R&D-intensive firms? Motivated by existing theories, we hypothesize that as competition increases, R&D-intensive firms will: (1) increase R&D investment relative to assets-in-place that support existing...

Innovation is a difficult phenomenon to evaluate. Innovation impacts the firm in a variety of ways. It is difficult to analyze the full impact of innovation because there is no single set of metrics that can capture its full significance. The metrics that have been traditionally used only...

We examine the role of spillover learning in shaping the value of exploratory versus incremental R&D. Using data from drug development, we show that novel drug candidates generate more knowledge spillovers than incremental ones. Despite being less likely to reach regulatory approval, they are...