Behavioral implications of absorptive capacity: The role of technological effort and technological capability in leveraging alliance network technological resources

Abstract This paper focuses on the moderating role of a firm's absorptive capacity in realizing innovation benefits from the firm's alliance network technological resources. We conceptualize absorptive capacity along two dimensions—technological effort and technological capability—and hypothesize that these two dimensions have opposing moderating effects which can result in theoretical and empirical misspecifications if ignored. We argue that firms with higher technological efforts have greater motivation to search for knowledge from their alliance partners, place more value on the external knowledge and mobilize such knowledge, and face lower internal resistance to assimilate and to use the knowledge. On the other hand, firms with stronger technological capability have lower motivation to search for knowledge from alliance partners, put lower value on the knowledge, make less intense efforts to mobilize it, and face greater internal resistance in assimilating and using the knowledge. By analyzing longitudinal data of 178 U.S.-based public semiconductor firms during 1988–2000 using negative binomial regression, we find that as firms increase their technological effort, the benefits from alliance network resources in terms of technological innovations come at a higher rate. In contrast, as technological capabilities of firms increase, the benefits from the alliance network resources in the form firm technological innovations come at a lower rate. We further discuss important theoretical and managerial implications of our findings.