Please use this identifier to cite or link to this item: http://hdl.handle.net/10995/102283
Title: Absorptive Capacity and Innovation: When Is It Better to Cooperate?
Authors: Egbetokun, A.
Savin, I.
Issue Date: 2015
Publisher: Springer Science and Business Media Deutschland GmbH
Citation: Egbetokun A. Absorptive Capacity and Innovation: When Is It Better to Cooperate? / A. Egbetokun, I. Savin. — DOI 10.1007/978-3-319-13299-0_16 // Economic Complexity and Evolution. — 2015. — P. 373-399.
Abstract: Cooperation can benefit and hurt firms at the same time. An important question then is: when is it better to cooperate? And, once the decision to cooperate is made, how can an appropriate partner be selected? In this paper we present a model of inter-firm cooperation driven by cognitive distance, appropriability conditions and external knowledge. Absorptive capacity of firms develops as an outcome of the interaction between absorptive R&D and cognitive distance from voluntary and involuntary knowledge spillovers. Thus, we offer a revision of the original model by Cohen and Levinthal (Econ J 99(397):569–596, 1989), accounting for recent empirical findings and explicitly modeling absorptive capacity within the framework of interactive learning. We apply that to the analysis of firms’ cooperation and R&D investment preferences. The results show that cognitive distance and appropriability conditions between a firm and its cooperation partner have an ambiguous effect on the profit generated by the firm. Thus, a firm chooses to cooperate and selects a partner conditional on the investments in absorptive capacity it is willing to make to solve the understandability/novelty trade-off. © 2015, Springer International Publishing Switzerland.
Keywords: ABSORPTIVE CAPACITY
EXTERNAL KNOWLEDGE
KNOWLEDGE SPILLOVER
KNOWLEDGE STOCK
POTENTIAL PARTNER
URI: http://hdl.handle.net/10995/102283
Access: info:eu-repo/semantics/openAccess
SCOPUS ID: 84959245964
PURE ID: 20454441
fa888dcd-05d0-46e7-a0fc-33b46b21df3c
ISSN: 21993173
DOI: 10.1007/978-3-319-13299-0_16
Appears in Collections:Научные публикации, проиндексированные в SCOPUS и WoS CC

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