Entrepreneurship, Absorptive Capacity, Technical Capability and Innovation Performance

The objectives of this study are three-fold. First, it examines the relationship between entrepreneurship and absorptive capacity after which it explores the influence of absorptive capacity with technical capability. Finally, it looks into the mediated effect of realized absorptive capacity and the relationship between potential absorptive capacity and realized absorptive capacity. Surveys on Chinese companies through the Internet and Smart PLS were utilized and the research model was analyzed. In summary, results showed that the positive impact of entrepreneurship on potential absorptive capacity and realized absorptive capacity is significant. Second, the potential absorptive capacity improves technical capability while the direct effect on innovation performance is not statistically significant but it improves the innovation performance positively through the mediating effect of realized absorptive capacity. Third, realized absorptive ability positively improves a company’s technical capacity and innovation performance.