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Competitive pressure and technological degree of the product portfolio: Implications for firm performance

Author

Listed:
  • Szabolcs Szilárd Sebrek

    (Faculty of Business and Economics, Department of Management, University of Pannonia)

  • Betsabé Pérez Garrido

    (Faculty of Business and Economics, Department of Quantitative Methods, University of Pannonia)

Abstract

This paper seeks to illuminate empirically a class of drivers of firm performance hitherto neglected in the economic literature. To accomplish this objective, we distinguished three elements: sales volume, participation in technology alliancing, and successful patent issuing. Our findings suggest that competitive pressure posed by larger rivals in an industry affects sales performance negatively, but the possession of absorptive capacity can counter this deleterious effect. Findings regarding the effects caused by a product portfolio with high technological content are mixed. Depending on the performance measure applied, the results show evidence of adverse outcomes for sales, U-shaped effects for participation in technology alliancing and inverted U-shaped results for patenting. We obtained our raw data from the 2006 and 2008 PITEC database, which is the Spanish equivalent of the EU Community Innovation Survey. Our sample embraces more than 3000 firms.

Suggested Citation

  • Szabolcs Szilárd Sebrek & Betsabé Pérez Garrido, 2015. "Competitive pressure and technological degree of the product portfolio: Implications for firm performance," Acta Oeconomica, Akadémiai Kiadó, Hungary, vol. 65(2), pages 211-229, June.
    • Handle: RePEc:aka:aoecon:v:65:y:2015:i:2:p:211-229
    Note: The authors thank P. Mendi, A. Barge-Gil, Z. Kovács, L. Szabó, Á. Török, and seminar participants at University of Pannonia (Veszprém, Hungary), Universidad de Navarra (Pamplona, Spain) and 2014 Redete Conference at University of Banja Luka (Bosnia and Herzegovina) for comments and suggestions on an earlier draft. Financial support from the Spanish Ministry of Education and Science (Grant No. ECO2009-08308), and the European Union (Grant No. TÁMOP-4.2.3-12/1/KONV-2012-0026) is gratefully acknowledged. The usual disclaimer applies.
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    More about this item

    Keywords

    competitive pressure; absorptive capacity; technological degree of the product portfolio; firm performance; large sample size;
    All these keywords.

    JEL classification:

    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • M10 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - General
    • M19 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Other

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