Investigating the Moderating Effects of Age of Joint Venture in the Relationship between Relationship Characteristics and Degree of Inter-Firm Technology Transfer

Sazali Abdul Wahab

doi:10.2139/ssrn.1949230

Abstract

Based on the underlying knowledge-based view (KBV) and organizational learning (OL) perspectives, the main objective of this paper is to empirically examine the moderating effect of size of MNCs on the relationships between relationship characteristics: relationship quality and mutual trust and two distinct dimensions of degrees of technology transfer: degrees of tacit and explicit knowledge within IJVs. Using the moderated multiple regression (MMR), the theoretical models and hypotheses in this study were tested based on empirical data gathered from 128 joint venture companies registered with the Registrar of Companies of Malaysia (ROC). The results revealed that size of MNCs has significantly affected the relationship between relationship characteristics (relationship quality and mutual trust) and degree of tacit knowledge; where the relationship was found stronger for medium/small MNCs than large MNCs. However, size of MNCs did not moderate the relationship between relationship characteristics and degree of explicit knowledge. The study has bridged the literature gaps in such that it offers empirical evidence on the moderating effect of size of MNCs on the relationships between relationship characteristics and two distinct degrees of technology transfer: degrees of tacit and explicit knowledge using the Malaysian sample.

Highlights

While technology transfers through international joint ventures (IJVs) have been acknowledged by many studies as the most efficient formal mechanism in internalizing the partner’s technologies, knowledge and skills, the transfer process has frequently involved various facilitators, actors and complex relationship between partners which cause direct impact on degree of technology transfer
Since the current issue on inter-firm technology transfer (TT) in the developing countries is centered on the efficiency and effectiveness of the transfer process by the multinationals (MNCs); the success is often associated with degree of technology transferred to local partners
This R2 means that 32.6% of the variance in the TCTDEG is explained by relationship characteristic (RCHAR) scores and JVAGE

Summary

Introduction

While technology transfers through international joint ventures (IJVs) have been acknowledged by many studies as the most efficient formal mechanism in internalizing the partner’s technologies, knowledge and skills, the transfer process has frequently involved various facilitators, actors and complex relationship between partners which cause direct impact on degree of technology transfer. Since the current issue on inter-firm technology transfer (TT) in the developing countries is centered on the efficiency and effectiveness of the transfer process by the multinationals (MNCs); the success is often associated with degree of technology transferred to local partners. In the context of inter-firm TT; where technology transfer processes involve more www.ccsenet.org/ijbm complex relationship, the impending issue now is on the effects of relationship characteristics (RCHAR) on degree or level of technology transfer (TTDEG). Based on a literature review, a large stream of literatures has identified the relationship characteristic (RCHAR); which include JV’s characteristics, as organizational distance (Simonin, 1999a, 1999b), cultural distance (Lyles and Salk, 1996; Mowery et al, 1996; Choi and Lee, 1997; Inkpen, 1998a, 1998b, Liu and Vince, 1999), organizational context (Kogut and Zander, 1993; Zander and Kogut, 1995), knowledge connection (Inkpen, 2000), organizational structure (Inkpen and Beamish, 1997), ownership type (Kogut, 1988; Mowery et al, 1996), ownership equity (Pak and Park, 2004), relationship openness (Hamel, 1991; Inkpen, 2000), partners attachment (Inkpen and Beamish, 1997), inter-partner trust (Baughn et al, 1997; Morrison and Mezentseff, 1997; Love and Gunasekaran, 1999, Inkpen, 2000), empathy (Buckley et al, 2002), relationship quality and strength (Szulanski, 1996; Lin, 2005), relational openness (Wathne et al, 1996), relational capital (Kale et al, 2000), informal relationship (Clarke et al, 1998), articulated goals and management commitment (Choi and Lee, 1997; Morrison and Mezentseff, 1997), and legal, political and technical differences (Marcotte and Niosi, 2000)

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