Recalibrating S&T collaborations under the decoupling - evidence from Chinese ICT firms

The current decoupling and bifurcated situation arising from external shocks, represented by the US-China trade war, has triggered unprecedented challenges for firms in strategically sensitive industries, such as the Information and Communication Technology (ICT) industry. Chinese firms in the ICT industry are at the forefront, and they are compelled to recalibrate their innovation portfolios. Through the institutional logics perspective, this study investigates how Chinese ICT firms recalibrate their research and development (R&D) investment in science and technology (S&T) collaboration. The findings show that ICT firms have prioritized their R&D resources in collaborating with domestic partners, mainly domestic firms, while replacing the S&T collaboration with foreign firms. Furthermore, firms’ overseas business plays a negative moderating role in the relationship between firms’ R&D investment and S&T collaboration with domestic partners. However, government support has not exerted a significant moderating role in this relationship. We also find that collaborating with domestic partners does not translate into improved profitability for these firms. The study provides timely insights into firms’ innovative collaboration under the decoupling and valuable suggestions for policymakers and managers.