Cross-border organizational strategies for knowledge appropriation: Codified and complex technologies

Abstract

Appropriating returns to research and development is a crucial concern for firms conducting research and development under weak intellectual property rights regimes. To safeguard against such risks, firms can resort to an internal collaboration strategy in which technologies are developed in cross-border inventor teams. We argue that the adoption of such organizational strategies depends on the characteristics of the technology: its codifiability and complexity. We develop and test a framework in which the adoption of organizational strategies for appropriation is a function of excludability and imitability, with technology characteristics influencing imitability and misappropriation risks. Our patent-level study of cross-border internal collaboration strategies by 613 foreign research and development establishments of 101 leading multinational enterprises suggests strong technological boundary conditions to the use of organizational strategies to deal with intellectual property risks abroad.