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The paper proposes an answer to one of the most important questions in corporate innovation management: what mechanisms of technological diversification exist within multinational companies? It is ascertained that research and development (R&D) intra-firm co-invention or co-patenting is one of those mechanisms. Co-invention implies knowledge-sharing, which should lead to unique combinations of knowledge and expertise and hence technological diversification of patent applications.

This paper offers a novel conceptual framework exploring the relationship between patents’ technological diversification and a detailed classification of different forms of international co-invention. Based on the case of Siemens’ Patent Cooperation Treaty (PCT) applications, the revealed technological advantage (RTA) index is utilized to measure the extent of the technological diversification of patent output.

The results show that patent applications generated by subsidiaries in advanced economies in cooperation with other subsidiaries feature unique technological areas that deviate from the company's overall technological specializations. These results provide a strong argument in favor of inter-subsidiary or horizontal co-patenting as a mechanism of new knowledge creation.

On the conceptual level, the results accentuate inter-subsidiary patenting being an important mechanism of knowledge meta-integration boosting technological diversification. The obvious limitation of this paper lies in exploring a single company case, which restricts the generalizability of our findings. Due to the dynamic nature of technological change, the author’s dataset also suffers from a lack of temporal external validity. Future research can expand the scope in both regards in applying our co-invention mode typology.

Based on the results, to diversify knowledge portfolio, companies should strengthen the co-patenting effort and reinforce horizontal (inter-subsidiary) R&D collaborations.

To the author’s knowledge, this is the first time when such a nuanced typology of co-invention modes is being utilized to understand the effect of different co-invention categories on knowledge diversification.

Firms increasingly diversify their technological competencies to achieve different strategic objectives. This study aims to explore the impacts of technological knowledge characteristics on patenting choices for inventions created by subsidiaries in an uncertain and fast changing environment.

The data used in this study are patents granted to the world largest firms by the USPTO for inventions attributable to their subsidiaries in China between 1996 and 2005. In addition, the patent data from State Intellectual Property Office (SIPO) of China are used for the matching in terms of filing patent applications in both USA and China for a same piece of technology. A discrete Logit model is used to examine the effects of technological distance and categories on Chinese patent application and international priority.

The findings suggest that firms have priority to seek international patent protection, instead of host country protection, for valuable subsidiary inventions in their background and marginal technological fields. In addition, a firm may seek host country legal protection simultaneously for inventions built upon knowledge from technologically distant fields.

As we are more interested in protecting technological knowledge, the protection of other types of knowledge, such as organizational knowledge, deserves further research attentions. Moreover, future research may expand current study by including small and medium firms, as well as firms in other developing economies.

While the economic and legal environment in China may have evolved since studied period, the results have practical implications for firms in other developing countries that are at an early stage of catching-up or those in a host location featuring a similar uncertain and fast changing environment. In particular, the study suggests that foreign firm managers would have more strategic choices of patenting than local firms in the host country. For strategically important inventions bridging complex knowledge from different technological areas, firms could seek protection in multiple countries simultaneously, including both home country and other major markets. Furthermore, managers could choose whether or not to protect a particular category of technologies in host country depending on value of the technology to the firm and the IPR protection of host country. Finally, the approach of looking at knowledge-level characteristics, which can be easily measured through readily available intra-firm information, provides managers with a practical and useful tool to make these strategic decisions.

This study represents an effort to extend the understanding on how foreign MNCs could generate and appropriate valuable technologies in an uncertain and fast-changing environment. In particular, the authors focus on how MNCs could use different international patenting patterns to benefit from subsidiary inventions. Whereas previous literature mainly focuses on country-level and firm-level determinants, this study approaches the topic through the lens of knowledge-level factors. By studying how knowledge characteristics determine firm strategic behaviors, the authors offer additional justifications of the knowledge-based view of the firm. Meanwhile, the findings enrich our understanding of an important component of MNC’s global strategies in managing their technologies through selectively patenting in different locations. Firms pursue diversified technologies for different strategic objectives. As subsidiary inventions become a very important source of firm competitiveness, MNCs have to face the trade-off between higher patenting costs and the appropriability of subsidiary generated knowledge. The findings suggest that it is not necessary for MNCs to protect all subsidiary inventions in host countries.

This paper addresses the geographical dimension of cross-border knowledge integration, expressed as the co-invention of patent filings and investigates the siting of patenting activities by major US corporations in China. Most importantly, the study looks into the patterns of international co-invention or the links of these locations to headquarters and other company subsidiaries.

The study explores the cases of six US multinationals that file international patent applications in China. The applications were analyzed based on the composition of invention teams and the locations of inventors.

The co-invented patent filings by US multinational enterprises (MNEs) in China demonstrate a high degree of US–Chinese subsidiary collaboration. Links with other subsidiaries are marginal, and at the same time, high levels of sole patenting by inventors in China point to competence-creating research and development (R&D) activities taking place.

The lack of subsidiary-subsidiary collaboration, especially subsidiaries in other emerging markets, indicates a less diversified strategy of leveraging internal networks of knowledge. This also implies that Chinese subsidiaries still lack attractiveness as partners in subsidiary-subsidiary co-invention. Only two companies in our sample, Procter & Gamble and Intel, demonstrate a highly diversified, integrated and transnational pattern of innovation management.

The paper contributes to the contextual understanding of the rich landscape of R&D activities of major US MNEs in China. By exploring these cases, the paper identifies a number of trends. First, the R&D activities in this sample are highly concentrated in technological clusters located in Beijing and Shanghai. Technological clustering is an important advantage of the innovation landscape in emerging markets. Second, the paper underscores the importance of differentiating between different types of co-invention. The patent applications in this sample tend to unite inventors mostly from the US and China, and so multi-country applications involving subsidiaries in other countries are rare. Thus, the level of integration outside the center-host bandwidth is low. However, Chinese subsidiaries demonstrate high levels of autonomy by filing single-country applications, which implies that they are building their own research identity.

Considerable attention has been paid to the motives and process of idiosyncratic internationalization trajectory of Multinational Corporations from emerging economies (EMNCs). Yet, the ability to undertake strategic asset-seeking foreign direct investments (FDIs) is not the same as the ability to achieve subsequent investment success (Buckley, 2018). Since an ultimate goal of strategic asset-seeking FDIs is to tap advanced knowledge in host locations to accelerate EMNC competence creation, and the current study aims to shed light on the question of whether, and if so how, EMNCs have been able to build competences after strategic asset-seeking motivated FDIs.

This study tests the US patent and citation data from 2000 to 2014 of leading innovation-oriented MNCs from China and India, complemented with data from LexisNexis Directory of Corporate Affiliations and Mergent Online databases. Wilcoxon rank sum test is employed to compare EMNCs with control group MNCs from mature industrialized countries to identify key technological competence creation mechanisms of EMNCs. Negative binomial regression technique is then employed to test the relationship between the key mechanisms and EMNC innovative performance in terms of quantity and quality of patented inventions.

In contrast to the extant EMNC literature, the author finds that EMNC parents adopt a hands-on and less of an orchestrating approach. They are playing critical roles in accessing and transferring knowledge from international host locations. The empirical analyses indicate an absence of reverse transfers of knowledge from subsidiaries to the parent. Instead, EMNC parents directly access and absorb explicit knowledge from external sources in subsidiary host locations, which significantly contributes to EMNC innovative performance. Meanwhile, the author finds that the employment of intra-firm and inter-unit inventor teams and associated internal tacit knowledge access and transfer significantly contribute to EMNC innovative performance.

This study investigates the post-internationalization performance of EMNCs and contributes to the reconciliation of theoretical debates, as well as the generation of a comprehensive understanding of the MNC. Managerial implications are also discussed.

With considerable attention paid to the motives and process of idiosyncratic internationalization trajectory of multinationals from emerging economies (EMNCs), little is known on whether, and if so how, new competitive advantages of EMNCs are created and accumulated over time. MNC and EMNC literature agrees on the importance of external and internal knowledge linkages in technological competence creation. By building upon this framework, this paper aims to evaluate EMNCs’ external and internal knowledge flow patterns by benchmarking their counterparts from mature industrialized countries (MMNCs).

This study analyzes US patents granted between 2000 and 2014 to leading innovation-oriented EMNCs from China and India, and their matched MMNCs. Being the first to use the US patent and citation data in studying leading innovation-oriented EMNCs, the authors use a descriptive statistical method.

The findings offer empirical insights of the scale, scope and quality of EMNC technological competence creation. Moreover, in contrast to existing EMNC literature, it is found that EMNC parents have been the most important center of EMNC technological knowledge generation. The matched group comparisons of external and internal knowledge flows further reveal detailed similarities and differences of competence creation between EMNCs and MMNCs, and among EMNCs.

This study represents one of the first attempts to investigate the post-internationalization technological competence creation of EMNCs by using a novel data source. This study sets the foundation to deepen the understanding of EMNC technological competence creation. The findings suggest interesting propositions and offer important implications for future researches.

The purpose of this paper is to identify major developments in corporate innovation. The author focuses on the behavioral differences between MNEs from developed and emerging markets in the way they locate their R&D activities.

With the help of descriptive statistics, the paper identifies major trends in the global distribution of innovative activity. The novel source of patent statistics, Patent Cooperation Treaty (PCT) applications, is used as a proxy for innovative effort by leading MNEs. This paper is among the first attempts to analyze the global geography of innovation based on PCT statistics.

The analysis underscores differences in the patenting activities of MNEs from emerging and advanced markets. It confirms that innovative activity by major MNEs remains largely home-based, which contradicts the premise of the global nature of corporate innovation. At the same time, the growing importance of China as a research center attracts MNEs from a variety of developed markets. Emerging MNEs also file patent applications domestically. Most Chinese R&D subsidiaries of MNEs from advanced economies in our sample do not pursue technological specialization, as they produce patents in the same technological areas as the corporate headquarters or other subsidiaries.

A number of assumptions about the innovation geography of major MNEs were empirically tested. An attempt was made to fill the gaps in our understanding of innovation strategies pursued by MNEs in emerging markets. The author uses the concept of MNEs as meta-integrators to explain the observed dynamics. Its explanatory power is more convincing as applied to our data than the concept of national systems of innovation.

This study aims to analyze the subsequent investment success of EMNCs after their strategic asset-seeking foreign direct investments (FDIs), while internationalization trajectories of multinational corporations from emerging economies (EMNCs) have been extensively studied, Post-internationalization investment success of EMNCs is defined as extensive technological knowledge access and transfer for knowledge combination. This paper focuses on EMNC explicit knowledge access and transfer.

This study analyzes US patents granted between 2000 and 2014 to leading innovation-oriented EMNCs from China and India as well as to their key competitors from mature industrialized countries (MMNCs). Wilcoxon Rank Sum Test is used to compare the explicit technological knowledge access and transfer patterns of EMNCs and MMNCs. With MMNCs as the benchmark, the comparison allows to imply the patterns and extent of technological knowledge access and transfer of EMNCs.

While subsidiary reverse knowledge transfer is largely missing, EMNCs adopt a parent-centric approach in which the parent directly accesses and transfers explicit knowledge from the external environment of host locations. In doing so, EMNCs at least partially achieve the knowledge access and transfer goals of strategic asset-seeking FDIs.

This study contributes to an in-depth understanding of EMNCs by empirically testing key predictions in extant EMNC literature, namely, the strategic asset-seeking in host locations and the systematic integration of accessed knowledge and resources with home country activities. This study also pioneers the use of the US patent and citation data to empirically study EMNCs.

The purpose of this paper is to argue that multilateral knowledge transfer emerges from two lines of thinking in the international business (IB) literature – the exploitation of multinationality and the contributory role of subsidiaries – and links three levels of analysis – headquarters, knowledge-creating subsidiaries and host-country environments.

Multilateral knowledge transfer, both vertical and horizontal, is considered in this paper as a cross-level phenomenon that emerges as a result of beneficial interdependencies between headquarters, knowledge-creating subsidiaries and their host-country environments. The paper also discusses the concept of embeddedness, which both lines of thinking draw upon, and argues that the multinational enterprise (MNE) headquarters can actually moderate both internal and external embeddedness through global strategy and organizational design.

By putting forward an integrative cross-level interdependency framework that incorporates insights from the R&D internationalization literature and the subsidiary evolution literature, this paper delineates multilateral knowledge transfer as an MNE strategy to systematically transform and integrate knowledge created at the subsidiary-level for the global competitive advantage at the MNE group-level.

Such a perspective reemphasizes the multi-level nature of IB studies and provides new opportunities for theoretical and empirical development as did the internalization theory which has theorized the conventional headquarters-to-subsidiaries knowledge transfer more than 40 years ago.

The purpose of this paper is to study the effect of second generation involvement on corporate innovation in Chinese family firms.

Based on the manually collected sample of listed Chinese family firms from 2003 to 2014, the study empirically examines the impact of second generation involvement on corporate innovation. The authors apply a difference-in-differences research design and a Heckman two-stage least squares regression to relieve the endogeneity concerns.

The research finds a positive relationship between second generation involvement and corporate innovation. This effect is more pronounced among the firms appointing second generation family members with overseas training experience and firms with weak external monitoring. Further analysis shows that the curtailment of related party transactions and the improvement of accounting information quality are important channels.

The findings provide several practical implications for Chinese family firms to survive the succession process and maintain competitive advantages across generations.

First, this study is helpful to understand the strategies adopted by family firms to maintain their long-term competitiveness and pursue continuing growth across generations. Second, the findings are also consistent with the transfer cost hypothesis of Fan et al. (2012) and Bennedsen et al. (2015). Finally, the findings imply that second generation involvement has a substitutive effect for external monitoring mechanisms.

The purpose of this paper is twofold: to analyze to what extent innovation output of R & D collaborations, proxied by co-patenting activities in terms of quantity, characteristics and value, differs depending on whether the engaged R & D partners have a certain type of relationship (allies, suppliers and subsidiaries); to identify possible automakers co-patenting patterns taking into account the differences in the innovation output with their R & D partners.

To reach the aims, the authors matched two types of data: co-assigned patent portfolio of four automakers and relationship type between automakers and their co-assignees. Matching the company names of the two data sources allowed the authors to obtain the final data set used to carry out extensive descriptive and regression analysis, both on a firm- and patent-level.

Results show differences in the characteristics and the technological value of patented inventions in relation with the type of collaboration partner; they also support the authors in the identification of four co-patenting patterns (contingent, purposive, watchful and advanced) according to the co-patenting propensity and the presence of a preferred relationship type.

The paper contributes to the literature by investigating the presence of differences across the patenting activities of a selection of automakers and their supplier, allied and subsidiary firms. The issue related to patent value represents an emerging area of interest in the field of collaborations for innovation. The methodology constitutes a novelty by matching two different sources and standardizing the company names (“name game”) through an automated algorithm and a double manual check, by searching company web sites and corporate trees.