AIB 2012 Conference Proceedings - Academy of International ...

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negative effect depends on a focal firm's market experience. (For more information, please contact: Seong-
Young Kim, EMLYON Business School, France: kim@em-lyon.com)
How Do Alliance Partners Share the Value They Create Determinants of the Value Split in International
Technology Transfer Alliances
Farok J. Contractor, Rutgers University
James Woodley, Ramapo College
This paper tests different determinants of partner shares of alliance returns, for a sample of cross-border
technology transfer alliances. Findings suggest the importance of bargaining power as an influence on partner
shares of alliance returns and suggest that firms with better absorptive capacity gain more from alliances. There
is a positive correlation between risk and return in alliances; in other words, firms that want a greater share of
total returns from an alliance may be able to reach that objective by also agreeing to accept more risk or
volatility. On a related point, shifting risk to a partner by insisting on minimum sales or minimum royalty
requirements is typically accompanied by a smaller share of total alliance returns for the partner offloading risk.
Finally, the findings suggest that return and risk are evaluated in a holistic manner by those negotiating and
designing alliances. Implications for theory and practice are explored and further research about issues raised in
this paper is recommended. (For more information, please contact: Farok J. Contractor, Rutgers University,
USA: farok@andromeda.rutgers.edu)
To Compete or to Cooperate: Contrasting Distance Determinants for Semiconductor Alliances
Sonya H. Wen, Tamkang University
How do competitive dynamics between partners impact alliance strategies To approach such inquiry, we
devised a hypothesized governance model by applying the literature of competitive dynamics and knowledgebased
view in the empirical context of technology intensive alliances. Two contrasting hypotheses driven by
competitive tension versus cooperative incentives are developed and then tested on a sample of 1,696
Semiconductor alliances during 1985 and 2008. These sampled alliances formed by actual and/or potential
competitors are intentionally selected to magnify the hypothesized contrasting governance effects of multidimensional
distance determinants. We posit that driven by cooperation that the higher cooperative barriers or
higher distance, and contrastingly driven by competition, the higher resource similarity or lower distance
between alliance partners, the higher propensity of equity-base mode to safeguard their comparative
advantages against competitors. We found empirical support of both hypotheses on the direct or contingent
governance effects of six distance determinants. In comparison, our research demonstrates that the governance
driver of cooperative incentives stronger than competitive tension, as well as weaker governance effects of
cultural distance than the distance dimensions of power, coordination, knowledge, and experience. Such
contrasting results support our call for more alliance research to analyze the strategic dynamics between
competition and cooperation. (For more information, please contact: Sonya H. Wen, Tamkang University,
Taiwan: sonya.wen@gmail.com)
Exploring the Influence of Institutional Embeddedness of Partner Firms on Inter-Partner Dynamics in
International Strategic Alliances
Swetketu Patnaik, University of Kaiserslautern
The article aims to demonstrate the influence of institutional embeddedness on the practices that organizations
adopt in international strategic alliances and their implication on alliance dynamics. Whereas most studies, in
international business, explore the dynamics of institutional arrangements in the context of issues relating to
host country partner selection, little is known on how institutional embeddedness of partner firms have an
influence on the dynamics of inter-organizational relations. Our paper, based on a longitudinal study of two cooccurring
international strategic alliances of an Indian biopharmaceutical firm explores how institutional
embeddedness of partner firms influence their alliance formation activities, the approaches they adopt to
AIB 2012 Conference Proceedings
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