Is an Imitation Strategy an Enabler or a Hindrance for Exploitative or Exploratory Innovation?—The Moderating Effect of Embeddedness in Knowledge Networks

The present open innovation environment provides firms with considerable opportunities to imitate and learn from one another and makes them deeply embedded in knowledge networks, where the structural position has a great influence on firms' R&D activities. However, the relationship between imitation and innovation, as two primary R&D approaches that firms follow in technological development, remains inconclusive. To address the inconsistent arguments concerning the appropriate role of imitation, this article explores the effects of imitation and its interaction with embeddedness in knowledge networks on two types of technological innovation: exploitative and exploratory innovations. Empirical analyses based on patent data from 175 Chinese biopharmaceutical firms from 2008 to 2018 show a prominent promoting effect of imitation on exploitative and exploratory innovation. However, the positive effects of technological imitation strategies on two types of innovation will be weakened as firms are increasingly central in the knowledge network, whereas occupying many structural holes has the opposite effect. These results offer new theoretical and practical implications to the technological imitation and innovation research domains.