Effects of relational embeddedness on technological innovation : An empirical study in China

Purpose – The purpose of this paper is to explore the effecting mechanism of relational embeddedness on technological innovation performance in the context of China. Design/methodology/approach – By probing into the related theories and five exploratory case studies of Chinese manufacturing firms, this paper establishes a conceptual model about the effects of relational embeddedness on technological innovation performance and proposes nine hypotheses. The authors then investigate 228 Chinese manufacturing firms by questionnaires, and testify the hypotheses and conceptual model by structural equation modeling. Findings – Chinese firm's relational embeddedness in the international manufacturing network has a positive effect on its technological innovation performance through explorative learning. Specifically, trust, information sharing and joint problem solving are beneficial to new knowledge acquisition and application, and then to the improvement of technological innovation performance. Research limitations/implications – This paper mainly focuses on bilateral relations among firms, regardless of the influence of network structure. Future research can extend to multilateral relations as well. Originality/value – The paper builds up linkages among theories of network resources, organizational learning and technological innovation to open the black‐box of how relational embeddedness acts on technological innovation. It is a supplement to the existing research on inter‐firm network theories in developing countries.