Coopetitor market overlap and innovation ambidexterity: performance implications under Knightian uncertainty

Interfirm coopetition has become an important avenue through which firms enhance innovation outcomes in response to today’s market environment. Although increasing scholarly attention has been devoted to the innovation implications of coopetitor market overlap, existing evidence remains inconsistent, leaving its influence on firms’ innovation strategies insufficiently understood. This study focuses on manufacturing firms, where innovation activities can be observed through patenting behaviour. Against this backdrop, we examine how coopetitor market overlap relates to innovation ambidexterity derived from patent data and firm performance, as well as the moderating role of Knightian uncertainty. Using a multi-source dataset covering 116 manufacturing coopetitors between 2017 and 2021, our findings show that greater coopetitor market overlap is associated with enhanced innovation ambidexterity. We also find that innovation ambidexterity fully mediates the relationship between coopetitor market overlap and firm performance. Furthermore, Knightian uncertainty amplifies the positive relationship between coopetitor market overlap and innovation ambidexterity. These findings provide additional insights into the innovation implications of coopetitor market overlap in the manufacturing sector and offer practical guidance regarding coopetition for promoting innovation ambidexterity and performance.