The influence of R&D partnership network on firm performance based on the perspective of social network: The case of Taiwan LED sector

Scholars have drawn on network literature to highlight the importance of external resources available to the firm through its networks. This purpose of this study is to investigate whether the position of R&D partnership network affect the firm performance. Based on this perspective, we examine the effect of the government-sponsored R&D consortia in Taiwan. This kind of policy encourages firms to take part in innovative technology fields, to develop technologies with strong potential for huge economic benefits, and to encourage academia and industry to collaborate and ultimately increase industrial competitiveness. We construct the R&D partnership network in Liquid crystal display (LED) industry by using 140 firms and test the hypothesis by using 60 listed public firms. The results show that firm joined in government-sponsored R&D consortia has better centrality and the structure hole than the others. Result also indicates a positive relationship between centrality, and patent number and structure hole and patent number but the network position of firms did not influence the firm financial performance. This study may lead to better understanding of effect from the government-sponsored R&D consortia and of the relationship between the firm network position and firm performance. The article concludes with implications for theory, research, and practice. © 2014 PICMET.