Look at U: Technological Scope of the Acquirer, Technological Complementarity with the Target, and Post-Acquisition R&D Output

Muhammad Shafique, John Hagedoorn

Research output: Contribution to journalArticlepeer-review


Different streams of literature in economics and strategy suggest that several characteristic of a firm’s technological base such as diversity, breadth, depth, and R&D portfolio affect its R&D output. Separately, strategy literature on technological mergers and acquisitions (M&As) suggests that the relationship between technological knowledge bases of the acquirer and the target, such as their technological similarities and complementarities, also affects the post-acquisition R&D output. This paper integrates the knowledge from these streams to further our understanding of technological M&As by examining how the pre-acquisition technological scope of an acquirer, encompassing the diversity and breadth of its technological knowledge base, affects its post-acquisition R&D output. Our analysis of a panel of technological acquisitions suggests that the acquirer’s technological scope has a U-shaped relationship with post-acquisition R&D output, measured in terms of patent filings. Moreover, technological complementarity between the acquirer’s and target’s knowledge bases positively moderates this relationship. Results show that acquirers have higher post-acquisition R&D output when their pre-acquisition technological scope is either narrow or broad rather than moderate and acquirers having a narrow technological scope benefit more from technological complementarities. Our findings have important implications for the effectiveness of corporate R&D strategy and M&A strategy in hi-tech industries.
Original languageEnglish
Publication statusAccepted/In press - 12 Apr 2022


  • R&D, technological acquisitions, technological scope, technological diversity, technological complementarity

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