مکانیسم های رسمی و غیر رسمی تخصیص: نقش باز بودن و نوآوری  Formal and informal appropriation mechanisms: The role of openness and innovativeness

1. Introduction This study examines how firms’ degree of openness and innovativeness is individually and jointly associated with their use of formal and informal appropriation mechanisms. Empirical work by Cohen et al. (2000) and Levin et al. (1987) already established that both formal and informal appropriation mechanisms are relevant for protecting the innovative endeavours of firms. Formal appropriation mechanisms, based on intellectual property (patents, trademarks, copyrights, and design rights), give innovating firms time-limited rights to exploit their discoveries, inventions, and new designs. These formal appropriation mechanisms create incentives for firms to re-invest in innovations, new technologies, and to diffuse new products based on innovations that are protected by law. In addition, firms can use informal appropriation mechanisms, such as secrecy, lead-time, and complexity (Neuhaeusler, 2012; Hall et al., 2014). In general, informal appropriation mechanisms are not protected by law, although in particular trade secrets can be enforced through confidentiality contracts and non-disclosure contracts. Lead-time and complexity are based on confidential and usually tacit knowledge that enables innovating firms either to benefit from first mover advantages through early commercialization of innovations or to benefit from complex new products and processes that are difficult for other firms to imitate within a short period of time. Given the increasing strategic importance of such appropriation mechanisms (e.g. Pisano and Teece, 2007; Somaya, 2012), recent research has begun to investigate factors that influence firms’ use of formal and informal appropriation mechanisms (see James et al., 2013 for a comprehensive review of that literature). For instance, the degree of patenting has been shown to be influenced by industry-level conditions (Cohen et al., 2000), firm size (Arundel and Kabla, 1998), and capital intensity (Hall and Ziedonis, 2001). Likewise, there is some preliminary understanding of industry- and firm-level factors that are associated with the cost of utilizing secrecy as an appropriation mechanism, such as competitive conditions (James et al., 2013), or the complexity of knowledge residing inside the firm (Liebeskind, 1997). A recent study by Neuhaeusler (2012) investigates to what extent firm characteristics, such as size and industry affiliation influence the preference for formal and informal appropriation mechanisms. Despite this evidence, less is known about how firms’ innovation activities are associated with the implementation of formal as well as informal appropriation mechanisms. This is surprising, since appropriation mechanisms are relevant tools for translating innovation activities into sources of competitive advantage (Milesi et al., 2013) and are, therefore, likely to be influenced by characteristics of the innovation process. This paper addresses this gap by investigating how the degrees of openness and newness of firms’ innovation activities influence firms’ use of both formal and informal appropriation mechanisms. Appropriability conditions are no longer to be considered as primarily exogenously given and as such firms can influence the characteristics of their appropriability context by means of specific strategies and behaviours (Pisano, 2006; Pisano and Teece, 2007; HurmelinnaLaukkanen, 2011; Neuhaeusler, 2012; Milesi et al., 2013). Innovative activities of firms involve resource-intensive processes to create new knowledge and to find commercially viable combinations of knowledge or technology. As new knowledge is created and combined, issues of protecting these innovative activities via appropriation mechanisms become particularly pertinent. Milesi et al. (2013) already suggested that characteristics of the innovation process influence firms’ choices as to how to appropriate innovation profits. They argue that since the innovation process is unpredictable, the implementation of appropriation strategies is an ex-post decision or, in the best case, arises at the same time as the innovation process. This study adds to this prior work by investigating how two specific characteristics of the innovation process –the degree to which it is open and the degree to which it is radical versus incremental – influence the implementation of both formal and informal appropriation mechanisms. As such this study follows prior research in suggesting that characteristics of the innovation process impact firms’ use of appropriation mechanisms. Since both independent and dependent variables are strategic choice variables that are not exogenous (see also Laursen and Salter, 2014) the research questions and hypotheses in this paper are formulated in terms of ‘associations’ rather than causal effects.