Empirical tests of optimal cognitive distance
AbstractThis article provides empirical tests of the hypothesis of Ã¢â¬Ëoptimal cognitive distanceÃ¢â¬â¢, proposed by Nooteboom (1999, 2000), in two distinct empirical settings. Variety of cognition, needed for learning, has two dimensions: the number of agents with different cognition, and differences in cognition between them (cognitive distance). The hypothesis is that in interfirm relationships optimal learning entails a trade-off between the advantage of increased cognitive distance for a higher novelty value of a partnerÃ¢â¬â¢s knowledge, and the disadvantage of less mutual understanding. If the value of learning is the mathematical product of novelty value and understandability, it has an inverse-U shaped relation with cognitive distance, with an optimum level that yields maximal value of learning. With auxiliary hypotheses, the hypothesis is tested on interfirm agreements between pharmaceutical companies and biotech companies, as well as on interfirm agreements in ICT industries.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Economic Behavior & Organization.
Volume (Year): 58 (2005)
Issue (Month): 2 (October)
Contact details of provider:
Web page: http://www.elsevier.com/locate/jebo
Other versions of this item:
- Wuyts, S.H.K. & Colombo, M. & Dutta, S. & Nooteboom, B., 2005. "Empirical Tests of Optimal Cognitive Distance," Discussion Paper 2005-45, Tilburg University, Center for Economic Research.
- Wuyts, S.H.K. & Colombo, M.G. & Dutta, S. & Nooteboom, B., 2004. "Empirical Tests Of Optimal Cognitive Distance," Research Paper ERS-2004-007-ORG, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus Uni.
- D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search, Learning, and Information
- L24 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Contracting Out; Joint Ventures
- L63 - Industrial Organization - - Industry Studies: Manufacturing - - - Microelectronics; Computers; Communications Equipment
- L65 - Industrial Organization - - Industry Studies: Manufacturing - - - Chemicals; Rubber; Drugs; Biotechnology
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