File(s) under permanent embargo

Ownership concentration and product innovation in Chinese private SMEs

journal contribution
posted on 2013-09-01, 00:00 authored by Z Deng, P S Hofman, Alexander NewmanAlexander Newman
Product innovation is extremely important to the growth, success, and ultimate survival of firms. Although its unique features in small and medium-sized enterprises (SMEs) have gained growing attention in the literature, there is limited knowledge as to how ownership concentration moderates the relationship between product innovation and its determinants. Based upon insights from agency and institutional theories, we examine the moderating effects of ownership concentration on the relationship between product innovation and its key determinants in Chinese SMEs, utilizing a large dataset of 43,728 Chinese firms over the period 2005-2006. We focus on examining the differences between single-owner SMEs, where there is dominant control of one family member, and multiple-owner SMEs, where principal-agent conflicts and principal-principal conflicts are more likely to occur. Our findings indicate that single-owned firms tend to convert research and development into product innovation more efficiently than firms with multiple owners, who are typically better at utilizing external sources of knowledge and human capital.

History

Journal

Asia Pacific journal of management

Volume

30

Issue

3

Pagination

717 - 734

Publisher

Springer

Location

Ann Arbor, Mich

ISSN

0217-4561

eISSN

1572-9958

Language

eng

Publication classification

C1.1 Refereed article in a scholarly journal; C Journal article

Copyright notice

2013, Springer