Please use this identifier to cite or link to this item: http://hdl.handle.net/10995/102469
Title: Absorptive capacity and innovation: When is it better to cooperate?
Authors: Egbetokun, A.
Savin, I.
Issue Date: 2014
Publisher: Springer New York LLC
Citation: Egbetokun A. Absorptive capacity and innovation: When is it better to cooperate? / A. Egbetokun, I. Savin. — DOI 10.1007/s00191-014-0344-x // Journal of Evolutionary Economics. — 2014. — Vol. 24. — Iss. 2. — P. 399-420.
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. © 2014 Springer-Verlag Berlin Heidelberg.
Keywords: ABSORPTIVE CAPACITY
COGNITIVE DISTANCE
INNOVATION
INTER-FIRM COOPERATION
KNOWLEDGE SPILLOVERS
URI: http://hdl.handle.net/10995/102469
Access: info:eu-repo/semantics/openAccess
SCOPUS ID: 84898539980
PURE ID: 357337
37c5a697-7d97-443d-8fc0-173d82b455eb
ISSN: 9369937
DOI: 10.1007/s00191-014-0344-x
Appears in Collections:Научные публикации, проиндексированные в SCOPUS и WoS CC

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