Technological footprint similarity and firm performance

Abstract

The existing literature has documented significant levels of technological similarity among firms in the same industry. However, there is no theory of how technological similarity affects firm performance. This study builds and tests a theory of performance consequences of technological similarity of a firm to its industry (“technological footprint similarity”). It argues that invention performance and market performance may be affected in different ways and that specific firm characteristics moderate these relationships. This study also argues that technological footprint similarity is different from the established concepts of technological diversification and strategic similarity. The contribution of the article centers on developing the concept of technological footprint similarity and developing and testing theory of its performance consequences in the presence of firm-specific moderators.