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Differential effects of pre- and post-acquisition R&D expenditures on post-acquisition performance

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  • Le, Son A.
  • Park, Jung Chul
  • Kroll, Mark

Abstract

Drawing from the behavioral theory of the firm and the resource-based view, we argue that different types of R&D (explorative and exploitative) and the timing of R&D investments (pre- and post-acquisitions) have differential effects on post-acquisition performance. By using a sample of 396 technology acquisitions, we find that pre-acquisition explorative and post-acquisition R&D expenditures are more beneficial for post-acquisition performance than are pre-acquisition exploitative and post-acquisition explorative R&D expenditures. Our results also show that firms investing in explorative R&D in the pre-acquisition stage and then exploitative R&D in the post-acquisition stage have better post-acquisition performance than firms that do otherwise.

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  • Le, Son A. & Park, Jung Chul & Kroll, Mark, 2014. "Differential effects of pre- and post-acquisition R&D expenditures on post-acquisition performance," Journal of Business Research, Elsevier, vol. 67(2), pages 92-99.
    • Handle: RePEc:eee:jbrese:v:67:y:2014:i:2:p:92-99
    DOI: 10.1016/j.jbusres.2012.11.012
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    Cited by:

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    2. Popli, Manish & Ladkani, Radha M. & Gaur, Ajai S., 2017. "Business group affiliation and post-acquisition performance: An extended resource-based view," Journal of Business Research, Elsevier, vol. 81(C), pages 21-30.
    3. Tabesh, Pooya & Vera, Dusya & Keller, Robert T., 2019. "Unabsorbed slack resource deployment and exploratory and exploitative innovation: How much does CEO expertise matter?," Journal of Business Research, Elsevier, vol. 94(C), pages 65-80.

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