When Do Firms Acquire External Patents in the Market for Technology? From a Perspective on Performance Feedback

Previous research on the market for technology has focused mostly on the supply side rather than the demand side of the market. Drawing on the behavioral theory of the firm, this study suggests search derived from performance below aspiration level as one of the determinants of the demand side motivation to join the technology transaction market. Although most existing performance feedback literature only focuses on financial performance, multiple aspirations and feedback exist simultaneously, and interact when firms conduct decision-making. Considering a comprehensive decision-making process, the results of this study provide a better understanding of how technology is acquired. Furthermore, we suggest that inconsistent feedback and the R&D structure of a firm as moderating factors that can influence the acquiring of technology in response to poor performance.