Improving performance of state owned entities (SOEs) can have significant economic impact in countries like India, where SOEs comprise around 30% of aggregate industrial sales. Though the literature on SOE reform is focused on privatization, privatization often has its limits. We suggest an alternative policy prescription based on evidence from 42 Indian state owned labs with 12,500 employees. We posit that monetizing intellectual property (IP) and leveraging the private sector could help reform SOEs that have underutilized IP. From a base of negligible U.S. patents, the Indian labs collectively emerged as a leading emerging market patentee, licensing patents to multinationals. Also, technology commercialization did not adversely affect publication quality and quantity. This followed incentive policy reform and leadership change. We exploit exogeneity of the timing of leadership change (driven by rigid government rules) as the basis for identification. Unlike prior SOE reform studies, mostly focused on China, we document that in the Indian context, collaboration between the state and private sector formed the engine of SOE reform.
This paper investigates the knowledge antecedents of strategic alliances whose firms face convergence in their sector, i.e. photographic imaging where disparate technologies are coming together. Taking a structural viewpoint, we investigate their brokerage and status around their research and development activities manifested in their collective intellectual property right filings that we construe as a knowledge space and the structure of which is explored as a precursor for the propensity to form strategic alliances. Status emerges as a liability for firms whose location in the knowledge space render them technology brokers, especially for those which enjoy high status as defined through deference by peer firms. High status brokers exhibit a lower propensity to collaborate with peers when compared to low status but structurally embedded firms due to the competitive threats they present. The strongest alliance propensity is found among high status but structurally embedded firms. The implications of the findings are discussed.