Abstract
Finding the factors driving enterprise innovation behavior from multiple dimensions is of great significance for promoting enterprise innovation. Open innovation based on overseas mergers and acquisitions (M&A) has become one of the main ways for enterprises to obtain knowledge and technology. However, there is still no agreement on whether open innovation based on overseas M&A can promote innovation behavior of enterprises. Based on data from M&A transaction and enterprise patent of China’s Shanghai and Shenzhen A-share listed companies from 2011 to 2018, this study constructs a propensity score matching and difference-in-difference model from the perspective of innovation performance and innovation investment empirically studies the influence of open innovation mode based on overseas M&A on the innovation behavior of enterprises and finds that open innovation based on overseas M&A can significantly promote the innovation performance and innovation investment. Meanwhile dynamic effects test shows this promotion effect is sustainable; it reaches the maximum in the year of overseas M&A and decreases in the next two years. In addition, the impacts are heterogeneous due to enterprise ownership and enterprise technology intensity. The findings extends the scope of understanding innovation behavior of enterprises from overseas M&A and provide solid evidence of significant business implications for the promotion of entrepreneurial innovation.
Highlights
Innovation is widely recognized as the main strategic driving force that leads to economic growth and development (Scuotto et al, 2020)
This study regards the overseas mergers and acquisitions (M&A) of listed companies as a quasi-natural experiment and uses the DID and propensity score matching (PSM) methods to solve the sample self-selection bias and reduce the endogenous problem, which clarifies the causal identification clearly. This study considers both the innovation performance and the innovation investment of enterprises innovation behavior and further analyzes the heterogeneous innovation effect of open innovation based on overseas M&A among different enterprise ownership and technology intensity
The four models are the influence of overseas M&A on enterprise innovation: (1) the total number of invention patents and utility model patents applied by enterprises in that year (Patent); (2) the number of invention patents applied by enterprises in that year (Invention); (3) the intensity of R&D investment (Rd); and (4) the proportion of technical personnel (Rdp)
Summary
Innovation is widely recognized as the main strategic driving force that leads to economic growth and development (Scuotto et al, 2020). The alternative is to search the external resources to gain the chances of innovation and achieve comparative advantages in fierce global competition. This leads firms to an open innovation system. As Chesbrough (2003) proposed in the early 2000s, open innovation means using knowledge inflow and outflow to promote enterprises to speed up internal innovation and broaden the market for the use of external resources such as partnership, licensing contracts, industry-university-research, that is, multiple subjects’ synergetic governance of enterprises, universities and government to promote talent cultivation and technological innovation, and other technology agreements (Duysters and Hagedoorn, 2001; Drayton and Budinich, 2010; Del Giudice and Maggioni, 2014; Carayannis et al, 2018). As one of the main way of open innovation (Berchicci, 2013), in the past ten years, mergers and acquisitions (M&A) have constantly grown (Bresciani, 2012; Öberg, 2017) and become one of the main ways used by firms to obtain knowledge and technology resources for innovation (Öberg, 2016; Shin et al, 2017) and augment their performance (Dezi et al, 2018)
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