Explaining Preferences for Control Rights in Strategic Alliances: A Property Rights and Capabilities Perspective Approach
Increases in alliance activity between research-intensive firms and incumbents is puzzling since it is challenging to contract upon highly uncertain R&D activities. Our paper extends prior research by exploring the relationship between firm capabilities and preferences for control rights. This link is important because the allocation of control rights has been shown to influence alliance outcomes. Using data based on a survey of biotechnology firms, we find that both current and future capabilities provide strong explanatory power for understanding preferences for control rights. Our results allow us to integrate aspects of the capabilities perspective into the property rights framework.
Haeussler acknowledges financial support from the German Research Foundation [SFB TR 15] and the Munich Center of Health Sciences. Higgins acknowledges financial support from The Imlay Professorship, the Greater Atlanta Regional Grants for the Study of Entrepreneurship and the Georgia Tech Center for International Business Education and Research (GT-CIBER) under a National center grant from the U.S. Department of Education. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.
Strategic Alliances: Trading Ownership for Capabilities Carolin Haeussler1 andMatthew J. Higgins2 Article first published online: 7 JAN 2014 DOI: 10.1111/jems.12047 © 2014 Wiley Periodicals, Inc. Issue Journal of Economics & Management Strategy Journal of Economics & Management Strategy Special Issue: Innovation Economics Volume 23, Issue 1, pages 178–203, Spring 2014