Invention or incremental improvement? Simulation modeling and empirical testing of firm patenting behavior under performance aspiration

作者:

Highlights:

• How performance discrepancy affects patenting strategy is analyzed.

• Two game-theoretical models are established to analyze the influence of performance discrepancy on patenting strategy.

• A company does more inventions when its performance is higher than aspiration.

• A company does more incremental improvements when its performance is lower than aspiration.

摘要

This paper explores how firms determine their patenting strategy when faced with different performance situations. Patenting strategy in this study is defined in terms of either engaging more in inventions with more risk and higher profit or in more incremental improvements with less risk and lower profit. We develop two game-theoretical models to analyze how different kinds of performance discrepancies encountered by a firm influence the evolution of the firm's propensity toward a patenting strategy. Then, an empirical analysis of 1921 listed companies in China is conducted to test the propositions derived from the two game-theoretical models. The results reveal the decision-making pattern of a firm's patenting strategy. Specifically, a firm with performance higher than its aspiration will prefer to engage more in invention-type patents, while a firm with lower performance than its aspiration will invest more in incremental improvement patents. Additionally, all else being equal, the patenting strategy more likely to succeed will be more appealing to firms, no matter what kinds of performance gaps they have.

论文关键词:Invention,Incremental improvement,Patenting strategy,Performance aspiration,Performance discrepancy

论文评审过程:Received 22 December 2016, Revised 26 June 2017, Accepted 3 July 2017, Available online 6 July 2017, Version of Record 18 September 2017.

论文官网地址:https://doi.org/10.1016/j.dss.2017.07.001