Microfoundations of Firm R&D Capabilities: A Study of Inventor Networks in a Merger

Taking a cue from a recently evolving stream that calls for exploring the microfoundations of capabilities, we focus on inventor networks to examine how the activities underlying firms' R&D change in the aftermath of a merger. We view mergers as events that cause anxiety and impede inventors' abilities to process research knowledge. Employing the notion of an intra-firm inventor collaboration network, we hypothesize that in the aftermath of a merger, the impact of knowledge that is prominent and widely available in the intra-firm network will increase but that the impact of knowledge that, albeit richer, is less easily accessible, will decrease. Our empirical study of the merger of Bristol-Myers and Squibb supports our hypotheses. The findings enhance our understanding not only of mergers and acquisitions, but also of the microfoundations of a firm's R&D activities.