The effect of going public on innovative productivity and exploratory search

Organization Science

Volumn 23, Issue 4, 2012, Pages 928-950

  Wu, Geraldine A ^a  

^a NEW YORK UNIVERSITY   (United States)

Author keywords

Exploration and exploitation; Initial public offerings; Innovation; Medical device industry

Indexed keywords

EID: 84867079027     PISSN: 10477039     EISSN: 15265455     Source Type: Journal    
DOI: 10.1287/orsc.1110.0676     Document Type: Article

References (89)

1. Acs, Z. J., D. B. Audretsch. 1988. Innovation in large and small firms: An empirical analysis. Amer. Econom. Rev. 78(4) 678-690.
2. AdvaMed. 2004. The medical technology industry at a glance 2004. Report, Advanced Medical Technology Association, Washington, DC. http://advamed.org/NR/rdonlyres/0A261055-827C-4CC6-80B6-CC2D8FA04A33/0/Chartbook-Sept2004.pdf.
3. Ahuja, G., C. M. Lampert. 2001. Entrepreneurship in the large corporation: A longitudinal study of how established firms create breakthrough inventions. Strategic Management J. 22(6/7) 521-543.
4. Alcácer, J., M. Gittelman. 2006. Patent citations as a measure of knowledge flows: The influence of examiner citations. Rev. Econom. Statist. 88(4) 774-779.
5. Alcácer, J., M. Gittelman, B. Sampat. 2009. Applicant and examiner citations in U.S. patents: An overview and analysis. Res. Policy 38(2) 415-427.
6. Allison, J. R., M. A. Lemley, K. A. Moore, R. D. Trunkey. 2004. Valuable patents. Georgetown Law J. 92(3) 435-479.
7. Arora, A., M. Ceccagnoli, W. M. Cohen. 2008. R&D and the patent premium. Internat. J. Indust. Organ. 26(5) 1153-1179.
8. Asker, J., J. Farre-Mensa, A. Ljungqvist. 2011. Does the stock market distort investment incentives? Finance Working Paper 282/2010, European Corporate Governance Institute, Brussels.
9. Azoulay, P., W. Ding, T. Stuart. 2009. The impact of academic patenting on the rate, quality, and direction of (public) research output. J. Indust. Econom. 57(4) 637-676.
10. Barber, J. S., S. A. Murphy, N. Verbitsky. 2004. Adjusting for timevarying confounding in survival analysis. Sociol. Methodol. 34(1) 163-192.
11. Baron, J. N., M. T. Hannan, M. D. Burton. 2001. Labor pains: Change in organizational models and employee turnover in young, hightech firms. Amer. J. Sociol. 106(4) 960-1012.
12. Benner, M. J. 2010. Securities analysts and incumbent response to radical technological change: Evidence from digital photography and Internet telephony. Organ. Sci. 21(1) 42-62.
13. Benner, M. J., M. Tushman. 2002. Process management and technological innovation: A longitudinal study of the photography and paint industries. Admin. Sci. Quart. 47(4) 676-706.
14. Bodnar, L. M., M. Davidian, A. M. Siega-Riz, A. A. Tsiatis. 2004. Marginal structural models for analyzing causal effects of timedependent treatments: An application in perinatal epidemiology. Amer. J. Epidemiol. 159(10) 926-934.
15. Boot, A. W. A., R. Gopalan, A. V. Thakor. 2006. The entrepreneur's choice between private and public ownership. J. Finance 61(2) 803-836.
16. Brau, J. C., S. E. Fawcett. 2006. Initial public offerings: An analysis of theory and practice. J. Finance 61(1) 399-436.
17. Bushee, B. J. 1998. The influence of institutional investors on myopic R&D investment behavior. Accounting Rev. 73(3) 305-333.
18. Bushee, B. J. 2001. Do institutional investors prefer near-term earnings over long-run value? Contemporary Accounting Res. 18(2) 207-246.
19. Carpenter, R. E., B. C. Petersen. 2002. Capital market imperfections, high-tech investment, and new equity financing. Econom. J. 112(477) F54-F72.
20. Certo, S. T., T. R. Holcomb, R. M. Holmes Jr. 2009. IPO research in management and entrepreneurship: Moving the agenda forward. J. Management 35(6) 1340-1378.
21. Chemmanur, T. J., S. He, D. K. Nandy. 2010. The going-public decision and the product market. Rev. Financial Stud. 23(5) 1855-1908.
22. Connelly, B. L., L. Tiyanhi, S. T. Certo, M. A. Hitt. 2010. Marching to the beat of different drummers: The influence of institutional owners on competitive actions. Acad. Management J. 53(4) 723-742.
23. Cyert, R. M., J. G. March. 1963. A Behavioral Theory of the Firm. Prentice-Hall, Englewood Cliffs, NJ.
24. DiMaggio, P. J., W. W. Powell. 1983. The iron cage revisited: Institutional isomorphism and collective rationality in organizational fields. Amer. Sociol. Rev. 48(2) 147-160.
25. Dushnitsky, G., M. J. Lenox. 2005. When do incumbents learn from entrepreneurial ventures? Corporate venture capital and investing firm innovation rates. Res. Policy 34(5) 615-639.
26. Fewell, Z., M. A. Hernán, F. Wolfe, K. Tilling, H. Choi, J. A. C. Sterne. 2004. Controlling for time-dependent confounding using marginal structural models. Stata J. 4(4) 402-420.
27. Fischer, H. M., T. G. Pollock. 2004. Effects of social capital and power on surviving transformational change: The case of initial public offerings. Acad. Management J. 47(4) 463-481.
28. Gittelman, M., B. Kogut. 2003. Does good science lead to valuable knowledge? Biotechnology firms and the evolutionary logic of citation patterns. Management Sci. 49(4) 366-382.
29. Google Inc. 2004. Form 424B4. Final prospectus, U.S. Securities and Exchange Commission, Washington, DC. http://www.sec.gov/Archives/edgar/data/1288776/000119312504143377/d424b4.htm.
30. Gourieroux, C., A. Monfort, A. Trognon. 1984. Pseudo maximum likelihood methods: Applications to poisson models. Econometrica 52(3) 701-720.
31. Graves, S. B. 1988. Institutional ownership and corporate R&D in the computer industry. Acad. Management J. 31(2) 417-428.
32. Greve, H. R. 2007. Exploration and exploitation in product innovation. Indust. Corporate Change 16(5) 945-975.
33. Hall, B. H., J. Lerner. 2010. The financing of R&D and innovation. B. H. Hall, N. Rosenberg, eds. Handbook of the Economics of Innovation, Vol. 1. North-Holland, Amsterdam, 609-640.
34. Hall, B. H., A. B. Jaffe, M. Trajtenberg. 2001. The NBER patent citations data file: Lessons, insights and methodological tools. Working Paper 8498, National Bureau of Economic Research, Cambridge, MA.
35. Hall, B. H., A. Jaffe, M. Trajtenberg. 2005. Market value and patent citations. RAND J. Econom. 36(1) 16-38.
36. Hannan, M. T., J. Freeman. 1984. Structural inertia and organizational change. Amer. Sociol. Rev. 49(2) 149-164.
37. Hansen, G. S., C. W. L. Hill. 1991. Are institutional investors myopic? A time-series study of four technology-driven industries. Strategic Management J. 12(1) 1-16.
38. Hausman, J., B. H. Hall, Z. Griliches. 1984. Econometric models for count data with an application to the patents-R&D relationship. Econometrica 52(4) 909-938.
39. Henderson, R. M., K. B. Clark. 1990. Architectural innovation: The reconfiguration of existing product technologies and the failure of established firms. Admin. Sci. Quart. 35(1) 9-30.
40. Hernán, M. A., B. Brumback, J. M. Robins. 2001. Marginal structural models to estimate the joint causal effect of nonrandomized treatments. J. Amer. Statist. Assoc. 96(454) 440-448.
41. Hsu, D. H. 2006. Venture capitalists and cooperative start-up commercialization strategy. Management Sci. 52(2) 204-219.
42. International Trade Administration. 2010. Medical devices industry assessment. Report, U.S. Department of Commerce, Washington, DC. http://www.ita.doc.gov/td/health/Medical%20Device%20Industry%20Assessment%20FINAL%20II%203-24-10.pdf.
43. Jaffe, A. B., M. Trajtenberg, M. S. Fogarty. 2000. Knowledge spillovers and patent citations: Evidence from a survey of inventors. Amer. Econom. Rev. 90(2) 215-218.
44. Jain, B. A., O. Kini. 1994. The post-issue operating performance of IPO firms. J. Finance 49(5) 1699-1726.
45. Jain, B. A., O. Kini. 2000. Does the presence of venture capitalists improve the survival profile of IPO firms? J. Bus. Finance Accounting 27(9/10) 1139-1176.
46. Jansen, J. J. P., F. A. J. Van Den Bosch, H. W. Volberda. 2006. Exploratory innovation, exploitative innovation, and performance: Effects of organizational antecedents and environmental moderators. Management Sci. 52(11) 1661-1674.
47. Jensen, M. C., W. H. Meckling. 1976. Theory of the firm: Managerial behavior, agency costs and ownership structure. J. Financial Econom. 3(4) 305-360.
48. Katila, R., G. Ahuja. 2002. Something old, something new: A longitudinal study of search behavior and new product introduction. Acad. Management J. 45(6) 1183-1194.
49. Kogut, B., U. Zander. 1992. Knowledge of the firm, combinative capabilities, and the replication of technology. Organ. Sci. 3(3) 383-397.
50. Lavie, D., U. Stettner, M. L. Tushman. 2010. Exploration and exploitation within and across organizations. Acad. Management Ann. 4(1) 109-155.
51. Levinthal, D. A., J. G. March. 1993. The myopia of learning. Strategic Management J. 14(S2) 95-112.
52. Levitt, B., J. G. March. 1988. Organizational learning. Annual Rev. Sociol. 14 319-338.
53. March, J. G. 1991. Exploration and exploitation in organizational learning. Organ. Sci. 2(1) 71-87.
54. Mavrinac, S. C., A. Blitz. 1998. Managing the success of the IPO transformation process. Working paper, Ernst & Young, London.
55. Medical Device Register. 2005. Medical Device Register: The Official Directory of Medical Manufacturers. Canon Communications, Los Angeles, CA.
56. Mikkelson, W. H., M. M. Partch, K. Shah. 1997. Ownership and operating performance of companies that go public. J. Financial Econom. 44(3) 281-307.
57. Nelson, R. R., S. G. Winter. 1982. An Evolutionary Theory of Economic Change. Harvard University Press, Cambridge, MA.
58. Nerkar, A. 2003. Old is gold? The value of temporal exploration in the creation of new knowledge. Management Sci. 49(2) 211-229.
59. Nohria, N., R. Gulati. 1996. Is slack good or bad for innovation? Acad. Management J. 39(5) 1245-1264.
60. Pagano, M., F. Panetta, L. Zingales. 1998. Why do companies go public? An empirical analysis. J. Finance 53(1) 27-64.
61. Papke, L. E., J. M. Wooldridge. 1996. Econometric methods for fractional response variables with an application to 401(k) plan participation rates. J. Appl. Econometrics 11(6) 619-632.
62. Pfeffer, J., G. R. Salancik. 1978. The External Control of Organizations: A Resource Dependence Perspective. Harper & Row, New York.
63. Platzer, M. 2007. Patient capital: How venture capital investment drives revolutionary medical innovation. Report, NationalVenture Capital Association, Arlington, VA. http://www.nvca.org/index.php?optionDcom_content&viewDarticle&idD268&ItemidD103.
64. Pollock, T. G., V. P. Rindova. 2003. Media legitimation effects in the market for initial public offerings. Acad. Management J. 46(5) 631-642.
65. Pollock, T. G., R. Gulati. 2007. Standing out from the crowd: The visibility-enhancing effects of IPO-related signals on alliance formation by entrepreneurial firms. Strategic Organ. 5(4) 339-372.
66. Robins, J. M., M. A. Hernán, B. Brumback. 2000. Marginal structural models and causal inference in epidemiology. Epidemiology 11(5) 550-560.
67. Rosenkopf, L., P. Almeida. 2003. Overcoming local search through alliances and mobility. Management Sci. 49(6) 751-766.
68. Santos Silva, J. M. C., S. Tenreyro. 2006. The log of gravity. Rev. Econom. Statist. 88(4) 641-658.
69. Schumpeter, J. A. 1934. The Theory of Economic Development. Harvard University Press, Cambridge, MA.
70. Shane, S., T. Stuart. 2002. Organizational endowments and the performance of university start-ups. Management Sci. 48(1) 154-170.
71. Simcoe, T. 2007. XTPQML: Stata module to estimate fixed-effects Poisson (quasi-ML) regression with robust standard errors. Program code, Boston College, Boston. http://fmwww.bc.edu/repec/bocode/x/xtpqml.ado.
72. Singh, J. V. 1986. Performance, slack, and risk taking in organizational decision making. Acad. Management J. 29(3) 562-585.
73. Song, J., P. Almeida, G. Wu. 2003. Learning-by-hiring: When is mobility more likely to facilitate interfirm knowledge transfer? Management Sci. 49(4) 351-365.
74. Sørensen, J. B., T. E. Stuart. 2000. Aging, obsolescence, and organizational innovation. Admin. Sci. Quart. 45(1) 81-112.
75. Stuart, T. E. 2000. Interorganizational alliances and the performance of firms: A study of growth and innovation rates in a hightechnology industry. Strategic Management J. 21(8) 791-811.
76. Stuart, T. E., J. M. Podolny. 1996. Local search and the evolution of technological capabilities. Strategic Management J. 17(S1) 21-38.
77. Stuart, T. E., O. Sorenson. 2003. Liquidity events and the geographic distribution of entrepreneurial activity. Admin. Sci. Quart. 48(2) 175-201.
78. Stuart, T. E., H. Hoang, R. C. Hybels. 1999. Interorganizational endorsements and the performance of entrepreneurial ventures. Admin. Sci. Quart. 44(2) 315-349.
79. Trostel, A. O., M. L. Nichols. 1982. Privately-held and publicly-held companies: A comparison of strategic choices and management processes. Acad. Management J. 25(1) 47-62.
80. U.S. Food and Drug Administration. Federal Food, Drug, and Cosmetic Act, Section 201 [21 U.S.C. 321]: Chapter II. Accessed June 15, 2007, http://www.fda.gov/RegulatoryInformation/Legislation/FederalFoodDrugandCosmeticActFDCAct/FDCActChaptersIandIIShortTitleandDefinitions/ucm086297.htm.
81. U.S. Patent and Trademark Office. 2010. General information concerning patents. Accessed July 6, 2011, http://www.uspto.gov/web/offices/pac/doc/general/index.html.
82. von Nordenflycht, A. 2007. Is public ownership bad for professional service firms? Ad agency ownership, performance, and creativity. Acad. Management J. 50(2) 429-445.
83. Wadhwa, A., S. Kotha. 2006. Knowledge creation through external venturing: Evidence from the telecommunications equipment manufacturing industry. Acad. Management J. 49(4) 819-835.
84. Wang, L. 2009. Ownership, size, and the formal structure of organizations: Evidence from U.S. public and private firms, 1992-2002. Indust. Corporate Change 18(4) 595-636.
85. Wooldridge, J. M. 1997. Quasi-likelihood methods for count data. M. H. Pesaran, P. Schmidt, eds. Handbook of Applied Econometrics, Volume II: Microeconomics. Blackwell, Oxford, UK, 352-406.
86. Wooldridge, J. M. 1999. Distribution-free estimation of some nonlinear panel data models. J. Econometrics 90(1) 77-97.
87. Wooldridge, J. M. 2002. Econometric Analysis of Cross Section and Panel Data. MIT Press, Cambridge, MA.
88. Zahra, S. A. 1996. Governance, ownership, and corporate entrepreneurship: The moderating impact of industry technological opportunities. Acad. Management J. 39(6) 1713-1735.
89. Zhang, Y., J. Gimeno. 2010. Earnings pressure and competitive behavior: Evidence from the U.S. electricity industry. Acad. Management J. 53(4) 743-768.