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Environmental Regulatory Influence And Product Innovation: The Contingency Effects Of Organizational Characteristics, Carol M. Sanchez, William Mckinley

Peer Reviewed Articles

This paper examines the relationship between environmental regulatory influence and product innovation in a multi-industry sample of manufacturing organizations. Our theory argues that the influence of environmental regulation on the level of product innovation in a manufacturing organization is at least partially contingent on the organization's internal characteristics -- in particular, its structural flexibility and production process flexibility. Hypotheses are derived from our theory and tested, and the results are consistent with the conclusion that structural flexibility and production process flexibility moderate the environmental regulatory influence-product innovation relationship. Whether environmental regulation inhibits or promotes product innovation seems to depend at …