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How and when does co-production facilitate eco-innovation in international buyer-supplier relationships? The role of environmental innovation ambidexterity and institutional pressures

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  • Chang, Kuo-Hsiung
  • Gotcher, Donald F.

Abstract

Eco-innovation is an important element of a firm's environmental sustainability strategy and provides both competitive and environmental benefits, resulting in a win-win solution. Although previous studies have examined the influence of co-production on innovation, little is known about how and when co-production affects eco-innovation in the context of international buyer-seller relationships. Building upon the resource-based view, the dynamic capability perspective, and institutional theory, this study develops a conceptual model focusing on the effects of co-production on eco-innovation, the mediating effects of environmental innovation ambidexterity, and the moderating role of institutional pressures. The research was carried out using a survey-based quantitative study and the proposed hypotheses were tested using the hierarchical regression analysis. The results of a survey of 124 OEM suppliers in Taiwan show that co-production has a positive effect on environmental innovation ambidexterity. Our findings also show that the direct relationship between co-production and environmental innovation ambidexterity is stronger when institutional pressures are high as opposed to when they are low and that environmental innovation ambidexterity mediates the relationship between co-production and eco-innovation. This study contributes to a theoretical understanding of why some firms develop more environmental innovation ambidexterity than others, by analyzing co-production as a predictor and institutional pressures as a moderator. We discuss the theoretical and managerial implications of our findings.

Suggested Citation

  • Chang, Kuo-Hsiung & Gotcher, Donald F., 2020. "How and when does co-production facilitate eco-innovation in international buyer-supplier relationships? The role of environmental innovation ambidexterity and institutional pressures," International Business Review, Elsevier, vol. 29(5).
    • Handle: RePEc:eee:iburev:v:29:y:2020:i:5:s0969593120300767
    DOI: 10.1016/j.ibusrev.2020.101731
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