Inventor Mobility and Hiring Firm Strategic Fit in the U.S. Laser Industry, Erin Fahrenkopf, Carnegie Mellon University

Inventor Mobility and Hiring Firm Strategic Fit in the U.S. Laser Industry

Abstract

Building off the literature on knowledge transfer, employee mobility and firm capabilities, I argue and find that the inward employee movements of those whose backgrounds fit with the hiring firms’ strategic focus result in more learning-by-hiring. In addition, I show that factors at the hiring firm moderate the extent new hires with strategic fit result in postmove learning at the firm such that during periods of capability development and when the firm is relatively new, the hiring of those with strategic fit results in heightened levels of knowledge flow into the firm. As such, my results show that the rate of interfirm knowledge flow associated with employee mobility depends on factors occurring within the hiring firm. The study focuses on the U.S. laser industry using patent and firm production data. The analyses examine the mobility of inventors with laser patents to laser device producing firms. The results suggest that firm knowledge does not transfer equally across firm boundaries by the movement of inventors, but depends on the movement of an individual with a particular set of experiences and to a firm during certain periods. Implications for the literature on employee mobility and firm capability development are discussed.