Title: How can digital technology-related acquisitions affect a firm's innovation performance?

Authors: Jianghua Zhou; Chenrui Liu; Xiaoqiang Xing; Jizhen Li

Addresses: Business School, Beijing Normal University, Beijing, 100875, China ' Business School, Beijing Normal University, Beijing, 100875, China ' Business School, University of International Business and Economics, Beijing, 100029, China ' School of Economics and Management, Tsinghua University, Beijing, 100084, China

Abstract: This paper studies how acquiring digital firms affects the post-acquisition innovation performance of traditional firms. Based on the longitudinal dataset of Chinese listed firms from 2007 to 2017, our findings show that digital technology-related acquisitions have a positive effect on a firm's innovation performance. Moreover, the construction of regional-level digital infrastructure plays a positive moderating role in this relationship. Furthermore, we propose a contingency model to investigate the moderating effect of internal digital investment and unabsorbed slack. The results indicate that the acquirer's internal digital investment has a positive moderating effect on the relationship between digital technology-related acquisitions and innovation performance. Meanwhile, the acquirer's unabsorbed slack also moderates this relationship positively. Our paper expands the contingency perspective within a traditional firm's digital transformation and has implications for future research and management practices.

Keywords: digital technology-related acquisitions; internal digital investment; digital infrastructure; unabsorbed slack; innovation performance.

DOI: 10.1504/IJTM.2021.120931

International Journal of Technology Management, 2021 Vol.87 No.2/3/4, pp.254 - 283

Accepted: 09 Aug 2021
Published online: 17 Feb 2022 *

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