Abstract: Extant research suggests when compared to equity, debt financing is less conducive to innovation activities. We argue that although equity sustains innovation by allowing experimentation, it may also encourage the pursuit of exploration at the expense of exploitation. Under these circumstances, the stricter rules associated with debt stimulate managers to shift resources back towards greater exploitation in order to mitigate risk and improve short-term pay-offs. In support of these arguments we show leverage is positively related to knowledge exploitation as reflected in self-citations. We also find that firms that over explore are likely to experience leverage increases in the short run, and these increases stimulate subsequent exploitation. These effects are consistent with firm value indicating equity holders value the role of debt in stimulating exploitation.

Abstract: The underlying study examines the influence of the structure and composition of family influence and involvement on exploitative and exploratory innovation. Whereas exploitative innovation entails taking use of existing knowledge, exploratory innovation embodies knowledge that is novel relative to a firm’s extant knowledge stock. A longitudinal investigation of public German family and non-family firms between 2000 and 2009 shows that family ownership negatively influences the amount of exploratory innovation undertaken in the firm. Active family involvement in management and the supervisory board however, increases the amount of exploratory innovation. The results therefore show that how and to what extent family firms own and involve in the firm is important.

Abstract: This study focuses on the nanotechnology sector (and specifically on the most recent developments on carbon nanotubes and graphene) and compares the technological landscapes of China and Japan. By examining a dataset of 20,365 patent families from 1994 to 2013, we analyze the structure of the knowledge creation industry in the two countries and assess how such structures might affect future processes of nanotechnology exploitation. We find that China and Japan are characterized by two contrasting knowledge structures. While the Chinese nanotechnology sector has emerged as the result of an anchor-tenant development model, technological knowledge and capabilities in Japan are more dispersed among firms and other actors. Different patterns of technology exploitation and technology-based entrepreneurship can be thus expected for the two countries.

Abstract: Drawing on the opportunity-motivation-ability perspective, this study investigates the relationship between a firm’s managerial ties and exploratory innovation. We argue that the opportunities for exploratory innovation brought by managerial ties need to be considered jointly with a firm’s motivation (e.g., innovation orientation) and ability (e.g., absorptive capacity). We differentiate between business and political ties and then argue for their distinct linkages with exploratory innovation. Analyses of 212 Chinese manufacturing firms support our arguments that innovation orientation and absorptive capacity jointly strengthen the relationship between business ties and exploratory innovation, but reduce the relationship between political ties and exploratory innovation. This study contributes to the literature by offering a fresh perspective examining the distinctive effects of different types of managerial ties on exploratory innovation.