Imitation versus innovation in the context of growth

Resumen

Title: Imitation Versus Innovation in the Context of Growth. Author: Ching T. Liao. Director: Prof. Bruno Cassiman. Both imitation and innovation are central theoretical constructs in the field of strategy. The former decreases and the latter increases performance heterogeneity. Despite its essential role in strategy, imitation is less studied compared to innovation. This is largely because imitation is often considered easy and straightforward. This doctoral dissertation points out imitation is more complex than previously assumed. It recommends viewing imitation as a strategy to rectify its value against innovation. A literature review focusing on their growth effects reveals the gap between rich theories and limited empirical studies. To facilitate future research, I suggest that Community Innovation Survey (CIS) as a suitable data source. Using Spanish part of CIS, I found that both imitation and innovation enhance productivity. The effects are heterogeneous depending on firms’ ranks in the conditional productivity distribution. Leveraging on the idea that firm learn to innovate by engaging in imitation, I further investigate how the heterogeneity of an imitation strategy affects the likelihood of skill upgrading. Focusing on product imitation, I identify two relevant characteristics: the imitation scope and the type of adjustments occurred due to the need of imitation. Based on CIS type data of firms in sub-Saharan Africa and South Asia, empirical evidence shows that firms engage in a narrow scope of imitation and implement related adjustments in the production process are most likely to experience skill upgrading. This doctoral dissertation advances knowledge in terms of the relationship between imitation and innovation in the context of growth. It demonstrates that innovation is not always superior to imitation, in terms of productivity effects. Although the capability to innovate can be developed by engaging in imitation, not all imitation strategies have the same effects. The characteristics of an imitation strategy matter. The research and the writing of the dissertation were done at IESE Business School, Barcelona campus, Spain, from 2014 to 2018, under the direction of Professor Bruno Cassiman.