Networks are certainly complex systems. Whom to pair up with for collaboration is a challenge already within the boundaries of a firm, let alone when looking beyond these boundaries, beyond geographical boundaries, beyond one’s own technology, all in the pursuit of the next chartbuster innovation. A recent study conducted together with Killian McCarthy (RuG) on the impact of geography on post-acquisition innovative performance appearing in Research Policy shows the complexity of technology driven acquisitions. Our empirical study considers the impact of geography on post-acquisition performance for technological acquisitions. Relying on insights from the transaction costs and international business literatures wesuggest that both geographic distance and borders influence post-acquisition innovative performance. Examining the patent portfolios of 3683 high tech acquirers in the period 2000–2012 we support a ‘liability of distance’ hypothesis and show that every 1000 km between the target and the acquirer costs as much as 19 lost patent applications. We do not find support for a ‘liability of foreignness’ hypothesis, however, but show in fact, that else equal, cross-border deals result in 3.15 additional patent applications. For high tech acquirers we find that ‘foreignness’ appears, therefore, to be more of an ‘asset’ than a ‘liability’. We find that the lion’s share of this is attributable to cultural differences.
For full details, contact me or see: McCarthy, K. and Aalbers, H.L. (2017) Technological Acquisitions: The Impact of Geography on Post-Acquisition Innovation Performance, Research Policy. (forthcoming)