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EMNE catch‐up strategies in the wind turbine industry: Is there a trade‐off between output and innovation capabilities?
Author(s) -
Awate Snehal,
Larsen Marcus M.,
Mudambi Ram
Publication year - 2012
Publication title -
global strategy journal
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.814
H-Index - 24
eISSN - 2042-5805
pISSN - 2042-5791
DOI - 10.1111/j.2042-5805.2012.01034.x
Subject(s) - industrial organization , business , emerging markets , knowledge base , phenomenon , focus (optics) , international trade , marketing , computer science , physics , finance , quantum mechanics , world wide web , optics
Emerging economy multinationals (EMNEs) are catching up with advanced economy MNEs (AMNEs) even in emerging, high technology industries, where their knowledge‐based disadvantages are most severe. We explain this phenomenon by distinguishing between output and innovation capabilities. Successful EMNEs' focus on output capabilities need not facilitate innovation catch‐up. We compare the knowledge bases of an industry‐leading AMNE and a fast‐follower EMNE using patent data, buttressed by qualitative information. The AMNE's knowledge base is deeper and composed of more distinct technology groups than that of the EMNE. The EMNE has caught up in terms of output capabilities, but still lags in terms of innovation capabilities. Our in‐depth comparative case analysis contributes to the literature on knowledge strategies and their impact on firm capabilities.