Appropriability regime for radical and incremental innovations

Abstract

In the present day markets, new product development and innovation are essential for value creation. Innovation, however, hardly provides benefits if rivals are able to copy it with little or no extra cost. Consequently, being able to build an appropriability regime that provides effective protection against imitation and enables getting returns on investments in innovation is necessary. The problem is that choosing the methods to protect different kinds of innovations is not straightforward. In this paper we study appropriating from radical and incremental innovations. It is widely known that many significant differences exist between the two innovation types, and the appropriability conditions are no exception. Empirical evidence on the topic is provided by analyzing survey data collected among 299 companies. As a result, the effects of environmental dynamism and research and development (R&D) intensity on radical and incremental innovation are illustrated, and knowledge is provided on the role of the appropriability regime in enhancing the potential to profit from radical and incremental innovations.

Exploring the use of patents in a weak institutional environment: The effects of innovation partnerships, firm ownership, and new management practices

“…Moreover, this finding supports innovation theory in that it explains the patent behavior of firms; that is, the inclination of firms to patent largely depends on the appropriability regime within which they operate (regardless of firms' ownership structures). Thus, our results are consistent with previous results indicating that foreign-controlled firms are more inclined to patent when they either have superior innovative capacity compared with their domestic counterparts (Costa and de Queiroz, 2002;Hurmelinna-Laukkanen et al, 2008) or are engaged in global innovation projects (Zhao, 2006).…”

Empirical Study on the Effect of Organizational Culture on Organization Innovation

“…It seems that the learning of organization is highly associated to OI. It is important to identify the kinds of innovation along with their features for the reason that a sure type of innovation wants unique and sophisticated replies from an association (Hurmelinna-Laukkanen et al, 2008). …”

Measuring technological novelty with patent-based indicators

“…Radical innovations have the characteristic of resulting in completely new products (e.g. Wheelwright & Clark, 1992;Ehrnberg, 1995;de Brentani, 2001;Hurmelinna-Laukkanen et al, 2008;DelgadoVerde et al, 2011;Ritala & Hurmelinna-Laukkanen, 2013) or products with new performance features (Leifer et al, 2001;Majchrzak et al, 2004;Veryzer, 2005;Lettl et al, 2006), products that incorporate a new technological design (Gassmann & von Zedtwitz, 2003) or in the birth of a new product class (Rothaermel & Hill, 2005). Others define radical innovations not in terms of different performance features, but rather in terms of the leap in product performance or price improvements (e.g.…”